NetZero Migrates Free Users to Premium Service

NetZero Inc. Thursday boasted that it has signed more than 116,000 billable
subscribers since it launched its premium NetZero Platinum service in March.

Those numbers, however, also reflect free ISP subscribers who make use of
the company’s NetZero Professional option. The free NetZero service was
altered in January to allow 40 hours access per month, but users can opt to
extend access time by paying $9.95 for NetZero Professional. Users who
choose the option revert to the free service at the end of the month.

The company said that more than 100,000 of the billable users have selected
the NetZero Platinum plan.

The rollout of the NetZero Platinum service coincided with NetZero’s
announcement that its fiscal second quarter results reflected a pro forma
net loss of $33.5 million, up from a loss of $24.4 million in the same
quarter the previous year.

NetZero had been the last all-free ISP hold-out. Arch-rival Juno Online Inc.
had long since added a premium offering to its portfolio of services, and claims 910,000 billable subscribers, the majority of which migrated from its free option.

At $9.95 per month, NetZero’s premium service offers unlimited access and no
ad banners.

“We’re thrilled with the early response we’ve had to our pay Internet access
services,” said Mark Goldston, chairman and CEO of NetZero.

“It is particularly encouraging that the vast majority of these pay
users have upgraded from our free service and that we’ve achieved these
results with minimal marketing efforts outside of our existing user base.
We believe the migration of these users to our pay services is a testament to
the quality of NetZero’s Internet access service.”

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