Yahoo Sheds Premium Services Sans Web Access
For $5.95 a month, or $3.95 a month with an annual subscription, Yahoo Plus offered plenty of software and services--for security/antivirus, e-mail, entertainment, and storage--but not Internet access.
When Yahoo Plus launched in late 2003, demand for "bring your own broadband access" bundles was higher, but has since dwindled as prices for broadband--and complimentary services--have fallen. In its place Yahoo has substituted co-branded broadband services with top telecoms like Verizon and AT&T.
"Interest has clearly shifted to co-branded packages, and it's become clear that Plus is not a core part of our growth," said a Yahoo spokesman. "It will allow us to focus completely on our co-branded efforts."
Last summer, Verizon replaced Microsoft's MSN with Yahoo as the default Web portal for its DSL service. In turn, Verizon aligned a Yahoo-branded Web browser and default home page for all its new broadband users.
Yahoo has a similar arrangement with AT&T--formerly named SBC Communications. As with Verizon, Yahoo receives a cut of revenue for every new broadband subscriber, while the providers get a piece of online advertising, search, and premium services dollars through Yahoo.
Like SBC, Verizon is spending billions of dollars extending its fiber-optic network across the United States. It plans to sell video programming through its fiber lines on top of speedier Internet access. Cable broadband typically costs about $45, but the Bells have priced their DSL as low as $14.95.