Microsoft is considering whether to offer free or low cost Internet access as part of a bid to knock Internet services giant, America Online (AOL), off its perch.
According to US reports, the software monolith has discussed purchasing or partnering with a number of local Internet Service Providers (ISPs), including Mindspring Enterprises and Earthlink, to help it target AOL's 17 million Internet access subscribers.
Microsoft is also understood to be keen on partnering with Compaq and Dell, which have recently launched their own access services. It apparently wants to attract more users to the Microsoft Network (MSN), which currently only has two million Web access subscribers.
But the reports quote Brad Chase, vice president of Microsoft's new consumer and commerce group, as saying that the firm intended to be aggressive in the access market because, while AOL might think about access as a profit centre, it did not.
A Microsoft spokesperson said the reports were merely "speculation", but admitted that offering free or low cost Internet access with partners "is an option," although it had no immediate plans to do so.
But the move is the latest in a game of words between AOL and Microsoft as the Internet battle for users hots up.
Late last month, AOL decided to prevent users of MSN Messenger, Microsoft's newly released instant messenger service, from communicating with its customers. The Redmond giant retaliated by gathering support from other Web email providers to urge AOL to open its network (see Newswire 31 July, 1999).
But analysts believe Microsoft is currently being aggressive because it is losing its grip on the desktop market.
Keith Benjamin, Internet analyst at Bancboston Robertson Stephens, said: "AOL has four out of five desktop clients. AOL reaches more people than Microsoft. Microsoft will have problems because it hasn't built a warm and friendly relationship with its customers."
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