EarthLink offers half-price discount

EarthLink has quietly launched a promotion that offers six months of service for half price, the Internet access provider's latest attempt to boost its subscriber numbers.

The promotion, which began in December and will last until March or April, will allow new subscribers to pay $10.98 a month for Internet access for six months. After that, subscriptions will revert to its regular rate of $21.95 a month.

The deal will be available through the company's call centers and on its Web site.

"The point is to increase the number of people trying our service," said Aaron Calloway, EarthLink's director of brand marketing for its narrowband service.

EarthLink's promotion comes at a turning point for the company and the dial-up ISP market as a whole. EarthLink last week said its total number of dial-up subscribers for 2002 declined 4 percent from 2001 to 4.03 million. The company attributed the decline to the "maturing of the premium dial-up access market and the continued migration of customers to broadband access."

Indeed, there are growing signs that the dial-up ISP market has become saturated. Last month, a study by Nielsen/NetRatings showed that U.S. households using dial-up access declined by 10 percent, in contrast to the 59 percent jump in broadband households. Still, more Americans access the Internet through dial-up than through broadband by more than a two-to-one difference, the study added.

EarthLink is not the only ISP hit by the market slowdown. On the same day EarthLink delivered its numbers, AOL Time Warner's America Online unit reported that its subscribers declined by 170,000 from the previous quarter. Microsoft's MSN, the second largest ISP, also said last month that its dial-up subscriber base showed no growth despite a $300 million advertising campaign.

Meanwhile, the EarthLink campaign may also help the company address the growing number of Internet users choosing discount ISPs. Yesterday, United Online, which runs NetZero, Juno and Bluelight.com, reported fiscal profit and subscriber growth for the fourth quarter.