Juno to bundle its free Net service with IBM PCs
Consumers purchasing IBM PCs will soon get their computers pre-configured for free Internet access from Juno Online Services.
The companies today announced a multiyear distribution agreement, with IBM bundling Juno connection software with new computers beginning in mid-August. The Internet service will be installed on IBM's Netvista and Aptiva desktop models, as well as on i Series ThinkPads.
Juno shares soared on the news, closing up $1.19, or 24 percent, at $6.12.
"Juno is attempting to embellish their distribution channels and get the first shot at customers," said Frederick Moran, an Internet analyst with Jefferies & Co. "If customers like the Juno service, they will likely stick with it."
Juno is not the first Internet service provider to strike deals with a computer manufacturer to increase distribution. America Online, for example, has a similar arrangement with Gateway.
ISPs are eager to reach new Web users first, as many consumers are believed to stick with the first service they use.
"Most every PC purchase today is made to get Internet access," Moran said. "The best chance to get a subscriber is when he first takes the PC out of the package."
Juno said it is the nation's third-largest dial-up ISP after AOL and EarthLink Network, with 3.38 million subscribers.