Aiming to profit from the astounding rate at which businesses in California are connecting to the Internet, Pacific Bell plans in May to start selling access to the worldwide computer network along with a variety of Internet-related services.
Initially, the services will be available only to large business customers in major metropolitan areas. By fall, they will be extended to consumers and small businesses in Los Angeles, Orange County, San Diego, San Francisco and Sacramento, and will be available statewide next year.
The move makes PacBell the first of the giant regional Bell operating companies to offer Internet access. It puts the company in direct competition with long-distance giant MCI Communications Corp., which on Monday launched its own Internet service, and with established Internet access providers such as Netcom Communications Inc.
Rick Hronicek, Pacific Bell's executive director for advanced communication services, said he expects revenue from the new business to exceed $100 million within three years.
PacBell will differ from other Internet service providers by concentrating on California. The company will likely benefit from the large number of high-tech and entertainment-related firms in the state, which have been at the forefront of those seeking to use the network for communication and promotional purposes.
More than 27% of the businesses connected to the Internet are registered in California, and the state's companies are connecting at three times that of the next nearest state, Massachusetts. The Internet has about 30 million users worldwide.
"If you took just the businesses in Silicon Valley that are connected, they would equal the total number of connections in Massachusetts," Hronicek said. "That makes California very attractive from a business perspective."
As for the consumer market, PacBell estimates that 7% to 8% of California households will have the computer equipment necessary to connect to the Internet by the middle of 1996.
PacBell is joining with Netscape Communications Corp., Sun Microsystems Co. and Cisco Systems Inc.