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America Online’s crusade against spam continues. The country’s largest internet service provider (ISP) has filed five more lawsuits against alleged purveyors of junk email, both individuals and companies. In the past year, spam has grown to account for roughly two out of every five email messages sent. Estimates put the cost to U.S. businesses at $8 billion to $10 billion annually. AOL says it has logged more than 8 million complaints from subscribers about the dozen or so spammers named in the suit. The company says the defendants have sent more than 1 billion pieces of spam to AOL members. The suits, which seek $10 million in damages and a halt to spamming activities, were filed in Alexandria this week and last. Although some states have anti-spam laws, there are no federal ones as of yet. Last week such legislation was re-introduced in the Senate, angering direct-marketing groups.
Microsoft barely dodges class action suit
Microsoft has been spared one class action suit on a technicality. A judge ruled Monday that because it would be nearly impossible to identify a “typical” Microsoft software buyer, a class action could not be issued for 60 consumer lawsuits pending against the Redmond, Wash.-based computing giant. But Microsoft didn’t worm completely off the hook. The U.S. District judge ruled that an overpricing suit stemming from items bought on the company’s web site, much smaller in scope, could proceed. Since the states’ and federal government’s anti-trust suit against Microsoft was settled last year, the company has been storing up money in case of consumer lawsuits. The coffer right now holds $43 billion.
DirecTV subscribers up and losses down
Subscriber growth for DirecTV is helping Hughes Electronics Corp. narrow its losses. The company reported a net loss of $50.9 million for the first quarter, a mere 16 percent of last year’s $837.7 million loss at this time. Based on the improvement, Hughes upped its year-long financial projections. The news comes a week after Rupert Murdoch’s News Corp. agreed to buy a 34 percent stake in Hughes. Company revenue increased to $2.2 billion, up 10 percent over last year, while DirecTV’s revenue was up 13.3 percent to $1.8 billion. DirecTV subscribers grew by 275,000 to 11.42 million total. Monthly churn, the rate at which customers cancel service, dipped to 1.5 percent. Hughes predicted it will add 800,000 to 850,000 subscribers in 2003, upping earlier estimates by 50,000 to 100,000.
Dogged by Microsoft, Overture expands overseas
Overture isn’t shying away from increased overseas competition. The Pasadena, Calif.-based paid-search company said Monday that it will expand into seven new European and Asian markets this year. The first launch will be in Italy during the second quarter. Austria, the Netherlands, Spain, Switzerland, parts of Scandinavia and South Korea will follow. Overture stock has slumped since speculation began recently that Microsoft will become another challenger to the company’s market share. Google and Europe’s eSpotting are currently its main rivals. Overture advertisers bid for top placement for search results. The company plans a new Dublin office to head up overseas activity.
In wired S. Korea, ISPs beware: Another folds
Overture target South Korea is one of the most wired nations in the world. But its ISP providers are folding at an alarming rate in an oversaturated market. On Monday Onse Telecommunications Co. became the second such company in the past month to close. Rival Korea Thrunet Co., a much larger provider, went under in March. Onse provided broadband and fixed-line telephone service. Cash, or lack thereof, became a big problem this year when South Korean banks pulled in their purse strings after Thrunet’s surprising collapse. Thus Onse couldn’t pay its short-term debts. Friday the company filed for court receivership. The company had billions in debt as of last week. South Korea has the world’s top broadband penetration rate, with 10.6 million of the country’s 48 million residents using high-speed connections. Roughly 70 percent total have web access.
April 16, 2003© 2003 Media Life
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