USA.net to begin charging for e-mail service

July 6, 2001

COLORADO SPRINGS, Colo. – USA.net officials plan to begin charging for Internet e-mail service because advertising revenue isn't covering operational costs, a spokeswoman says.

By the end of July, the company says its 4 million-plus e-mail users must decide whether to discontinue service or begin paying $29.99 a month for an upgraded account. New subscribers will pay $49.99 per month.

USA.net began its free e-mail service five years ago. Officials believed that they would be able to offset the cost by charging for ad space on the sites.

Like many Internet-related companies, USA.net discovered that advertising revenue wasn't enough, spokeswoman Danette Lopez said this week.

Other companies also have struggled against stiff competition from companies that provide Internet portals and services beyond e-mail to attract users.

"The most successful free e-mail services are those attached to something else that has some value," said Mark Levitt, a research director at IDC in Massachusetts.