September 12, 2002 1:46 PM PDT

Yahoo, SBC ready DSL launch

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SBC Communications and Yahoo will launch their co-branded high-speed Internet access service on Friday, an SBC representative said.

The statement Thursday came shortly after details of the service were briefly posted on Yahoo's Web site. As previously reported, the companies had been expected to launch the DSL (digital subscriber line) service by early next week.

Yahoo and SBC declined to comment on the information published online.

The service marks Yahoo's most ambitious step to date into the Internet access business, sharpening its rivalry with its chief Web portal competitors: Both America Online and Microsoft's MSN service have melded content and Internet service for years, becoming the No. 1 and No. 2 dial-up service providers in the United States.

No clear winner has yet emerged in the race to offer high-speed access, however, placing all three on relatively equal footing.

After taking a severe blow from a weak online advertising market, Yahoo is pinning much of its turnaround on boosting subscription revenue. Although financial details of the SBC partnership remain murky, Yahoo will take a cut of subscription revenue and offer a percentage of all advertising sold through the partnership to SBC.

Executives have already told Wall Street to expect up to $30 million of revenue generated from the partnership by the end of 2002. However, some analysts have publicly expressed skepticism that Yahoo can pull it off given the time it will take to market the service.

Nevertheless, the DSL service will test whether bundling Yahoo's content and services will convince online consumers to fork out the cash for a heftier monthly bill compared with dial-up. The partnership will also be a litmus test for whether Yahoo will be able to sell more services to consumers who access the Internet through a high-speed connection.

People living in states with SBC phone service can choose between packages with varying prices and payment plans.

One-year plans, which come with a free modem, free activation and a self-installation kit, are as follows:

• Standard Plus offers connection speeds ranging from 384kbps to 1.5mbps for $29.95 a month for the first six months and $49.95 a month for the rest of the year.

• Deluxe offers connection speeds ranging from 768kbps to 1.5mbps for $39.95 a month for the first six months and $59.95 a month for the rest of the year.

People subscribing month to month will not receive free modems, activation or self-installation and will be charged $49.95 a month for the standard package and $59.95 a month for the deluxe one.

Piggybacking the access plan, Yahoo will dole out a handful of the premium services that people would otherwise need to pay for on its Web site. The packages come with 25MB of e-mail storage, 110MB of data storage for files and photos, and a dial-up account. On top of this, subscribers can choose one premium service from each of these groups:

• Group A. Access to "Games All-Star," Yahoo's pay-for-play online games site or an additional 110MB of data storage.

• Group B. 500MB of data storage, online bill payment, five financial reports from MarketGuide Provestor, or an online subscription to the Encyclopedia Britannica.

In addition to these choices, all subscribers will get a customized home page programmed with Yahoo's content and Web services. According to a virtual tour offered on the site, subscribers will receive a souped up Internet Explorer browser that will link extensively to Yahoo-related sites and services. The browser appears similar to Microsoft's MSN Explorer browser, which provides quick links to e-mail, instant messaging, financial information and news headlines, among others.

 

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