OneMain.com Successfully Integrates California Services

Virginia-based OneMain.com this week
attained a milestone in its nationwide service integration strategy.

The company’s entire California operations, representing about 30 percent
of its subscriber base, were successfully transitioned to OneMain’s
national brand of dial-up services.

Mike Read, OneMain (ONEM)
president and chief operating officer, said the successful integration of
its California operations under the OneMain.com brand is a significant
achievement in fulfilling the company’s business strategy.

“The announcement is much more than a billing and engineering achievement,”
Read said. “It forms the foundation for OneMain’s plan to offer our
customers new products and services.”

Read added that OneMain is remaining true to its mission to become “your
hometown Internet,” as it continues to retain its local focus as well as
establish a national presence.

The OneMain.com network features local portals dubbed “geographic
communities” in 35 states. OneMain is continuing to integrate other local
operations into its national network over the next few months. Throughout
the year OneMain plans to launch additional geographic communities in the
smaller metropolitan markets and rural communities it serves.

As the consolidation continues, OneMain will begin to reap the benefits of
enhanced operating margins, taking advantage of its economy of scale to
reduce costs and business operations.

Originally pooh-poohed by industry analysts, OneMain.com came to market
with a revenue model that looked good on paper, but was in essence a
fundraising exercise to buy up a bevy of local ISPs. Profit sharing
agreements were struck with 17 independent ISPs while preparing its ISP
roll-up.

While other ISP roll-ups have failed to impress the market, including
Espernet’s decision to fold in February, OneMain continues to consolidate
its back office functions and impress analysts.

OneMain went public last year in March and raised $215 million, nearly
seven times its original goal of raising $31 million to fund its national
ISP ambitions.

Just over a year after its original stock offering, OneMain appears to have
affirmed the confidence of its early investors. Providing Internet access
to more than 700,000 customers in 35 states and producing a comfortable
balance sheet, the OneMain.com initiative is one-third of the way to
becoming and ISP success story.