ISP Pays You to Use Its Service

Those who are sick of shelling out around $US20 a month for their ISP (Internet service provider) can apparently make some of that money back -- and no, it's not a "paid-to-surf" view bar. MiracleMail's Tuesday announced the launch of a full-service Internet portal that allows customers to send e-mail, surf the Web and shop online, and the customers earn a share of the advertising revenue.

MiracleNet generates revenue from banner ads, e-mail ad insertions, advertorials and shopping affiliates, which in turn it passes on to members who refer other members, according to the company's Web site. If a user does not refer other members, the user still receives Internet service, but not payments.

"I'm not too enthused (about the service model)," said Harry Wolhandler, vice president of research at Web marketing analysis company ActivMedia Research LLC, based in Peterborough, New Hampshire. In general, "paid-to-surf" companies don't seem to be faring too well in today's market, he pointed out. For instance, Inc. withdrew its bid for an IPO (initial public offering) at the beginning of last month, citing "unfavorable market conditions." [See "Pay-to-Surf: Personalities on Sale, Anyone Buying?," July 21.]Additionally, in regards to the "refer-a-friend" model of advertising, word of mouth "doesn't give a special relationship to get into someone's home," Wolhandler said.

On the upside, the free and paid-to-surf ISP models attract people "at the lower end of the economic strata," he said. "I'm glad to see that folks from the rest of the economic spectrum getting something."MiracleNet offers a 56K-bps (bits per second) dialup account with a Web-based e-mail account, 3M bytes of e-mail storage, 50M bytes of Web-based file storage, a Web-based calendar and address book and a customizable start page, according to the company's Web site. Users get paid for up to five levels of referrals.

Upgrading to MiracleNet's Gold service at $9.95 per month offers users $10 per referral, in addition to the regular monthly bonuses, which are approximately 10 cents to 25 cents per user. The Gold service also gives users the chance to win a Caribbean vacation every two weeks, half-price movie tickets and an additional level of revenue sharing, in addition to a 10M-byte e-mail account that supports downloads to programs such as Microsoft Corp.'s Outlook, 16M bytes for a personal Web page and membership in UseNet groups, according to information contained on MiracleNet's Web site.

Wolhandler predicts that MiracleNet will have the same customer acquisition costs -- about $60 to $80 per customer -- as much more established large ISPs, such as EarthLink Network Inc. and America Online Inc. (AOL). Companies will have to "show an awful lot of advertising to pay" for the customer acquisitions, he said.

" (LLC) set up a free model and already serves this (free ISP) market well (and) has a brand name," Wolhandler said. "The newer class of free access (providers) are sponsored by companies that already have (marketing and promotional) relationships, where you pick up a disk at every Kmart. It's tough to compete against," he added.

MiracleNet, in Farmingdale, New York, can be reached online at

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