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Jewish World Review March 16, 2001 / 21 Adar, 5761


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Consumer Reports

Free lunch on the Net is over -- INTERNET users are beginning to discover there's no such thing as a free lunch - not even if it's a virtual-reality lunch.

"The dot-com marketplace has changed," said Sarah Harrison, a spokeswoman for and, companies that have provided free e-mail service to Web sites around the country. "Giving something away for free is no longer a good business model."

And that's just the beginning. Other companies are beginning to cut back on offerings of unlimited, free Internet access.

Juno, the best-known and most widely used free Internet service provider, displays advertising banners and limits access during peak periods for its heavy-usage, nonpaying users - but not for customers who pay about $9.95 per month for access. Kmart's BlueLight ISP, free for about a year, now limits its free access to 12 hours per month or 100 hours for $9.95. AltaVista and closed down their free ISP services last year., which was merged last month with, has announced it will no longer waive its e-mail service management fee for many Web sites.

The end or restrictions of free e-mail is due to the widespread economic "belt tightening" in the online service community. What may be most surprising, however, isn't the end of these free services, but that free services were being offered in the first place.

Ian Feavearyear, a spokesman for the online Free E-mail Providers Guide, said there were several ways to gain revenue from a free service:

Tagline advertising is used by all but a handful of the more than 600 free e-mail services, Feavearyear said. These advertisements are appended to the end of e-mail and are sent to the recipient along with the rest of the message. And, of course, banner advertising is almost always present on Web sites offering free e-mail.

All those users checking their e-mail in-boxes create a lot of "hits," and a lot of hits once meant more advertising revenue.

Advanced features, such as increased storage space, a unique domain name or the ability to receive faxes, also could be sold to users who want more than basic service, Feaveryear said.

The "big four" when it comes to free e-mail are Yahoo!, Microsoft's Hotmail, Juno and, Feavearyear said. Together, these e-mail providers still have more than 100 million e-mail accounts.

But as the free lunch given to e-commerce gets increasing rare, so do the free lunches e-commerce gives users.

"Times have changed," one expert said. "Getting to profitability is the goal."

Craig Garretson writes for the Cincinnati Post. Comment by clicking here.


© 2001, SHNS