Trying to find a niche

Once considered a contender in the online service war, Prodigy is now the smallest of the four major players, with about 1 million members.

But any reports of its death would be definitely premature.

Prodigy, which is also in the process of moving onto the Web, is again redefining itself--this time, as an Internet service provider that offers some great perks.

"I don't think Prodigy will continue to compete as a major online service," said David Simons, managing director of money management research firm Digital Video Investments. "They're competing as a major ISP."

When put into that category, they're actually running ahead of the pack.

ISPs generally offer basic dial-up Internet connections and little or nothing else. They have based their no-frills business models on the ability to undercut the big online services with low monthly rates, but a recent price war started by Microsoft Network threatens that strategy.

Prodigy is hoping to fit somewhere in-between. "We are still by far one of the largest providers in the world, and that's not a bad position to be in," company spokesman Mike Darcy said.

In addition, Prodigy is focusing its strategic efforts on largely untapped international markets, which present potential opportunities. The company "is really looking overseas for its growth," said Gary Arlen, president of research firm Arlen Communications.

And it won't stop there. Like AOL, Prodigy is trying to attract new users to the Net. "I want to make it so simple my grandmother can sign on."

Unfortunately for the privately owned Prodigy, it does not have the marketing muscle and money of AOL and MSN to make itself a household name. 

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