NetZero to Begin Charging Heavy Users for Web Access

The “zero” in NetZero won’t necessarily be the cost for heavy users of the company’s Internet access service.

NetZero is the Westlake Village company that pioneered the use of free online access, in exchange for a spam-like onslaught of targeted advertising. In January the company will begin charging $9.95 to customers who use the service for 40 hours or more during a single month. NetZero says the charges will apply mostly to small businesses and professionals.

In November, for example, only 12% of NetZero’s customers spent more than 40 hours online, but they accounted for more than 50% of the company’s telecommunications costs, NetZero said.

The company could not continue to provide this service to recreational users without recouping the costs incurred by its professional users, Chief Executive Mark Goldston said.

Mounting costs already have driven two NetZero competitors out of business. Spinway, the Sunnyvale, Calif., company that provided service for Kmart’s Bluelight.com, shut its doors Dec. 1. And San Francisco’s 1stUp.com, which supported free online access for millions of AltaVista customers, plans to shut down in early 2001.

NetZero has picked up many of their customers, pushing its member base past 7 million.