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Discover to try online service

Leaping into an increasingly crowded market, credit card firm Discover announces plans to launch a Web-based online service.

Leaping into an increasingly crowded market, credit card firm Discover today announced it is launching a Web-based online service.

The company, which gives users up to a 1 percent refund on their purchases depending on how much they spend, will team with Internet service provider EarthLink and content aggregator Planet Direct for the service, which will offer unlimited Internet access for $19.95 per month.

Discover card holders, however, will receive a 5 percent refund on their access fee, bringing down the cost of access by about a dollar.

Companies have been making deals at a record clip to get into the online service market. Unlike "old-style" proprietary systems such as America Online and Prodigy Classic, this new breed of service typically combines unlimited Internet access for about $20 per month with a Web-based gateway, or "portal," from a content aggregator such as Yahoo or Excite.

Recent deals have joined together aspiring portals Lycos and AT&T; Excite and AT&T; and Yahoo and MCI Communications.

"Although the various pieces of this are offered frequently, we view this as a unique offering," said Discover e-commerce vice president Colleen Zambole.

The differentiating factor, according to Zambole, is the combination of the Internet access and content offerings with Discover's credit card services, which currently are available to card holders at the Discover Web site. Users can sign up for service, check balances, and receive copies of statements dating back six months.

In appealing to its member base, Discover is tapping into a sizable potential audience for its online service. Though the company will not disclose how many active users it has, 47.3 million cards have been issued. Discover also declineds to disclose how many card holders use the Web site, but Zambole said that use has been growing "by an order of magnitude" in recent months.

Terms and length of the deal between Discover, EarthLink, and Planet Direct were not disclosed.