Phone Giants Take Their Duel To The Internet Mci Steps Up Promotion, Matches At&T; Offer Of Free Trip Into Cyberspace
They brawled over the phone. Now they’re sparring over cyberspace.
MCI Communications Corp. launched an aggressive pitch for its consumer Internet access service Monday after being stung by the interest AT&T Corp. has generated for its new connection to the global data network.
Although MCI has offered Internet access to consumers for more than a year, it has barely promoted it and analysts believe MCI has signed up fewer than 50,000 customers at home.
“MCI has let itself be cast in the role of reacting to AT&T even though they’ve been ahead for a number of months,” said Adam Schoenfeld, analyst at Jupiter Communications, an online industry research firm. “It’s really a mystery as to why they haven’t been aggressive on marketing.”
MCI said it has 2 million Internet subscribers, chiefly through services it runs for universities and businesses. It doesn’t break out subscribers by market segment, such as individuals at home, partly due to overlapping usage patterns.
MCI will match AT&T’s offer of five hours of free Internet time to people who use its long distance service. Unlimited access will cost $19.95, the same amount MCI charges now and that AT&T will charge for unlimited use of its Internet connection. Both MCI and AT&T charge $5 more to people who use other long distance companies.
Worried about its technical ability to handle a large number of customers, AT&T has said it will not promote its Internet service with a big-dollar advertising campaign. MCI will not do so until summer.
The free-pricing portion of AT&T’s service generated enormous publicity when it was announced three weeks ago, and the company threw an attention-getting picnic and software giveaway last week to kick off the service.
But AT&T has said it is having trouble filling demand for the more than 200,000 people who have asked for the software needed to connect their personal computers.
“AT&T seems to be building its Internet business out of newspaper headlines,” said Vinton Cerf, president of data architecture at MCI. He noted MCI already derives $100 million from Internet-related services.
MCI also said Monday that a planned upgrade of the portion of the Internet’s backbone it runs will be finished at the end of next month. The improvement will triple the data-exchange capacity, from 45 megabits per second to 155 megabits per second.
MCI executives said that change in technical design will give it a service advantage over AT&T.
MCI announced at the end of January a relationship with Microsoft Corp. to give preferential treatment to Microsoft’s Explorer browser program for surfing the World Wide Web portion of the Internet. In return, MCI gets to place access software to its Internet service in Microsoft’s Windows 95 operating system.