Targeting the 27 percent of U.S. households that aren’t yet online, America
Online will offer a low-priced hardware, software and Internet service
package beginning next week.
AOL’s “Optimized PC” bundle includes a computer, 17-inch monitor and printer
for approximately $300, plus 12 months of service from the ISP at $23.90
per month.
To appeal to computer novices, the package comes with color-coded cords, an
instructional poster and a video to help make set-up easier.
“We did do a limited test program for the PC a few months ago, the results
of which helped in the development of the [Optimized PC],” Jay Esmele, an
AOL spokeswoman, told internetnews.com.
There’s no time limit for the promotion, which will run through AOL retail
partners such as Office Depot, Esmele said.
AOL also hopes to attract more Spanish-speaking customers. In addition to
Microsoft’s Windows XP Home edition, each comes with AOL 9.0 Optimized
service, which includes AOL Latino service.
Fifty-five percent of Hispanic households where English is the dominant
language are online, compared to only 20 percent of households that speak
Spanish, AOL said, quoting research from the Synovate 2004 Hispanic Report.
AOL also plans to combine three of its brands — Black Focus, Black Voices
and Africana.com — into a new online destination for African Americans
later this fall.
The promotion comes as AOL looks to offset flagging subscriber numbers.
During the second-quarter, it shed 668,000 subscribers.
It still has 23 million U.S. subscribers, and the gradually declining
dial-up
business will be profitable for several years. A rebounding online ad
market helped AOL boost revenue 2 percent in the most recent quarter as
well,
and the company continues to roll out new services.
But to continue to gain from serving ads and selling new offerings, AOL, the
Internet arm of Time Warner , must retain a sizeable
subscriber base.
The services faces competition from low-priced dial-up ISPs like United
Online and EarthLink
, as well as higher-end
broadband providers including Comcast and Verizon
Communications .
