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The Cutting Edge: COMPUTING / TECHNOLOGY / INNOVATION : AT&T Dials Into the Internet Provider Field With Free Offer


WASHINGTON — AT&T Corp., the 800-pound gorilla of telecommunications, said Tuesday that next month it will venture into the fledgling Internet access provider field and begin offering its 80 million residential customers a year of free trial access to the global computer network.

Experts say the move is likely to transform what had largely been a cottage industry--albeit a fast-growing one--of a few national providers and hundreds of local and regional providers, who now charge computer users between $15 and $35 a month to access the Internet.

About 25 million Americans have been online at least once but AT&T--with its vast technical, financial and marketing resources--is expected to entice even more Americans to go online to send electronic mail, participate in discussion groups and browse the tens of thousands of colorful sites on the graphical World Wide Web.

"It's going to mean much lower rates for people and more value for less money," predicted Rod Kuckro, editor of the Information & Interactive Services Report in Washington. "But it's small Internet access providers and even some big ones like Netcom that are going to suffer."

Residential phone users who sign up this year would get five free hours a month of Internet use. Each additional hour would cost $2.50. The company is also offering unlimited Internet access for heavy users, including business customers, for $19.95 a month.

"The company that brought everyone the phone now will bring the Internet to everyone," said AT&T Chairman Robert Allen.

Rivals generally praised AT&T's entry into the field, saying it would help create greater awareness about the Internet, which despite all of the hype, has yet to attract anywhere near the mass audience enjoyed by other entertainment media such as TV and theme parks.

A survey last year by the Times Mirror Center for People & the Press, for example, found that no single online feature, with the exception of e-mail, is used with any regularity, and there is little indication that online information services are changing traditional patterns of news consumption.

"We think it's good for the industry because it will create more awareness and help grow the market," said Pam McGraw, a spokeswoman for America Online.

"I think they are doing the right thing by focusing on" the novice user, said John Zeisler, senior vice president of San Jose-based Netcom, one of the nation's largest Internet service providers with about 300,000 subscribers. But he predicted that as such customers become more experienced, they will want to stay online longer and will migrate to lower-cost plans for heavy Internet users such as those offered by his company.

But price may not be the only battleground.

AT&T pledged to give Internet users superior, 24-hour customer support. Most other Internet service providers offer such support only during normal business hours.

Customers will use software developed by market leader Netscape Communications Corp. to access the Internet through AT&T's own Web page. However, the company said users could also utilize any other Internet software to access the site.

The company promised to make the often-unwieldy Internet easier to navigate by offering a variety of navigational and search tools, including one-click access to Internet sites tailored to the tastes of the user, toll-free phone number directories and even directories of e-mail addresses of other AT&T customers.

AT&T said its Internet service will be available March 14.

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