After months of hype, the Microsoft Network officially launched today with lofty goals of getting the entire world to jump in and log on.
As of today, MSN has shipped or handed out 3.5 million CD-ROMs to potential customers.
In the midst of a $100 million marketing campaign, MSN aims to convert its 1.6 million members from its old service to more than 3.2 million members on its new service by June.
If you haven't seen one of the ubiquitous MSN ads in several venues--television, billboards, magazines, newspapers, and the Web--it's probably because you haven't been paying attention. But don't feel cheated just yet: After today's so-called full launch, marketing efforts will become even more intense.
MSN is taking advantage of the Christmas season and the fact that new PCs will be given as gifts.
While the new network won't turn away any customers, it's targeting the same market as America Online (AOL)--the new consumer with little or no online experience, said Larry Cohen, group product manager for MSN.
If stock prices are any indication, MSN's efforts may be having some effect. While Microsoft's stock (MSFT) rose by 0.15 percent today, AOL's stock dropped by 6.8 percent.
But it's still too early to tell how the revamped MSN will ultimately be received by consumers. Some veteran MSN users have complained about the new television-like format of the service, saying it slows the surf experience and offers more show than tell.
But others swear by the new service, saying they love the simplicity of the new design.
Cohen said that happened on purpose. "We wanted to make it really friendly," he said. "Our target customer is the person new to the Internet: either they have a computer and modem or they are going to buy a computer and modem at Christmas. We want them to think that the Microsoft Network is the easiest way to get the best stuff on the Internet."
Of course, that's exactly what AOL is trying to do with its own service. And AOL, with 7 million customers, dominates the online service market.
But observers of the competitive online world have said that the market is far from saturated and that MSN is poised to give AOL a run for its money.
Today, according to Cohen, signifies the beginning, not the end. "This is not the end of getting the CDs out there. This is just the start. Now we're in a heavy acquisition mode."
In fact, MSN is doing so well acquiring customers that the 800 number has been overwhelmed at times, and callers encountered busy signals when they called to order their CDs, Cohen added.
"There was some blockage early on. It should be fixed. There was a lot of demand. Demand was actually greater than we've even anticipated."