AOL Expands Dial-Up Contract

While a bandwidth-hungry world clamors for more broadband access, America
Online proves dial up is still king in the Internet world
with a contact expansion for more lines Monday.

Adding to a substantial contract with Level 3 Communications , one of several wholesale dial-up POP providers it deals with,
AOL increased its co-location presence around the U.S. and added more access numbers.

The deal is proof that while the company may have tro

in the high-speed access department, dial up is still a lucrative business.

Level 3 spokesperson Paul Lonnegren said AOL doesn’t divulge the
particulars in these types of contracts, but added the deal is huge for Level 3.

“AOL’s already our biggest customer and one we’ve dealt with since 1999,”
he said, “and this (contract expansion) is one of the biggest contracts
Level 3 has consummated in its history.”

According to the press release, the expanded deal adds dial-up access in
“hundreds” of U.S. cities.

Geraldine MacDonald, AOL senior vice president of global access networks,
said Level 3 is one of several wholesale providers AOL depends on for
nationwide coverage.

“Level 3’s high-performance managed modem infrastructure plays an important
role in helping us provide the best possible online experience for our more
than 34 million members,” she said. “Level 3 is a valued partner in our
portfolio of providers, and continues to invest in its dial-up access
platform, enabling us to cost-effectively expand our access coverage into
new geographic areas.”

According to Level 3, 80 percent of the roughly 100 million people on the
Internet today use dial-up connections. The continuing popularity of dial up
stands in seeming contradiction to the hype of broadband access via cable
or digital subscriber line (DSL) modem.

Level 3 Chief Technology Officer Jack Waters said the popularity of dial up shows few signs of waning.

“We believe that dial-up access will continue to be a highly viable and
growing business for Level 3 for years to come, and have continued to
steadily increase our managed modem business while maintaining strong
margins,” he said.

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