The popular teen Web site is the latest firm to challenge market leader
iTunes Music Store. Despite having just joined the online music business,
MySpace is expected to be a threat to the Apple unit since it already has
106 million users and has the full support of parent firm New Corp.

MySpace is bent on challenging Apple for a big share of the market. The new
player is optimistic that it will attract many users since clamors for
alternative services to iTunes are growing.

MySpace.com was the most visited Web site in America last year. Its
audiences are mostly teenagers who log on to the site to socialize and
exchange multimedia files.

Songs will be sold on the bands’ respective Web sites in MySpace. The file
can be opened in most digital players, even on the Apple iPod. The price of
each song would depend upon the rate that will be imposed by the artist.
MySpace would also be imposing a fixed distribution fee for each MP3 file.

Company officials said that copyrighted songs from big record labels would
eventually be included in the service.

If approved, any user with an Internet access would be able to sign up or
use any AOL service, including e-mail, free of charge.

The company stands to lose as much as $2 billion in income from online
service subscriptions. However, company officials believe that the gamble
would soon pay off as they expect advertisements to pour in once consumers
take advantage of the company’s free Internet features and other services.

Despite the plan, AOL dial-up clients would still have to pay their monthly
subscription charges.

The company is expecting around 8 million of its current dial-up clients to
drop their subscriptions to take advantage of the free services. It also
estimates that almost one-third of its 18.6 million customers already have
broadband Internet access.

AOL’s dial-up unit is experiencing massive customer loss to broadband
Internet. Around 850,000 subscribers opted out of their subscription
contracts with the company during the first three months of the year alone.

AOL’s Chief Executive Jonathan Miller has already transmitted the plan to
the top officials of Time Warner. The latter has yet to comment on the
proposal.

The thought comes as no surprise as everyday, more and more people are
relying on the Internet for numerous things such as getting the news,
checking the weather, and shopping. As such, expecting to make free calls
from an Internet connection is fast becoming ‘just another service’ that
people expect to get from the Internet. As Henry Gomez, general manager of
Skype, put it… “People are going to look at voice communications as
something they expect to get for free.”

This of course creates a highly competitive market, with companies such as
SunRocket and Vonage trying to twist the arms of traditional phone giants
such as AT&T and Verizon by selling phone services on their lines. To fight
back, AT&T and Verizon are offering huge discounts and encouraging consumers
to purchase service packages that offer more advanced features.

But again, it is those companies offering free PC-to-PC phone services that
are really driving phone prices down. As such, the prediction of research
firm TeleGeography that Internet phone providers will capture 1/4 of
traditional local phone business does not seem far-fetched at all.

Although Wi-Fi is available in several downtown business establishments,
residents want the local government to sponsor a network which would allow
them to connect to the Internet wherever they may be in the city.

The Downtown Loveland Association is spearheading the campaign to wirelessly
connect Loveland to the Internet. The group is already talking with
officials about the possibility and feasibility of putting up a wireless
system at least in the downtown area.

Loveland officials are open to the idea. However, they do not want to commit
on anything yet.

The association wants the wireless service to be free or at least
inexpensive. If ever the city agrees to the proposal, it is expected to
adopt a model wherein a private company would shoulder the cost of the
network’s installation and handle its operation as well. The cities across
the country that are building their own municipal Internet access systems
are following a similar business blueprint.

Businesses in downtown Loveland are also supporting the move, saying that
free wireless Internet would draw many consumers to the area.

Some commercial establishments, such as bookstores and coffee shops, have
already taken the initiative of providing their customers with free Internet
access since many are already demanding for it.

Calais, Marshfield, and East Montpelier will be the beneficiaries of the
expansion.

Marshfield officials have already approved the installation of the device in
their area as early as May 31.

On the other hand, the necessary permits were already dispensed with in
Calais and East Montpelier since the repeaters, and the manner by which it
will be installed, were deemed by many as unobtrusive.

The officials and residents of the three towns welcome the expansion, saying
that Internet access is essential for the development of their areas.

Larger Internet service providers such as Verizon and Comcast declined to
invest in Central Vermont because the towns therein are perceived to be
unprofitable. The area’s rural topography consists of hills and valleys. The
locale’s low population density is also another turn off for service
operators.

While Cloud Alliance agrees with its bigger counterparts in some aspects of
their observation, it also acknowledges that there is a big demand for
Internet access in Central Vermont.

The installation of the repeaters is expected to commence by the second week
of this month, and is expected to be finished two days thereafter.

The Senate Commerce, Science, and Transportation Committee has recently
approved a bill that would help phone and other telecommunications firms
compete with cable companies in the video industry.

The committee did not accept the amendment by Senators Olympia Snowe
(R-Maine) and Byron Dorgan (D-N.D.) that would disallow phone and cable
firms from restricting or regulating access to their broadband networks for
site content reasons.

Hundreds of interest groups fear that network operators might use this
prerogative to favor partners or discriminate certain Web sites or users.

They further cited the fact that the successful development of the Internet
is mainly due to the absence of restrictions regarding its use and access.
They argue that the bill would impede the Internet’s current rapid growth.

On the other hand, the proponents of the bill, along with cable and phone
companies, contend that the proposed amendment would actually stifle the
Internet’s development. They said that network providers would be
discouraged to invest more on their broadband systems if they would not be
allowed to charge consumers for the use of their systems.

Among the prospective Wi-Fi providers that were able to submit their
proposals before the deadline include MetroFi and Cisco Systems.

MetroFi has a considerable background on municipal Internet systems. It has
already installed networks in several locations in the Bay Area.

Curiously, though, Internet giants EarthLink and Google did not participate
in the bid. Both companies are currently collaborating on a similar venture
in San Francisco.

The other companies who were able to beat the deadline are Community
Wireless, NextWLAN, Fire2Wire, and the Blue Horizon Group.

The Wireless Silicon Valley initiative involves the creation of a vast
wireless system where thousands of transceivers would broadcast Internet
signals from South San Francisco and Fremont to Santa Cruz.

The proponents and supporters of the project are optimistic that the network
would bring desirable results in the covered areas. Among the goals that the
venture aim to achieve include free or low cost Internet access to poor
households, improvement of the public safety workers’ communications system,
and rationalization of city services.

However, skeptics doubt if the winning bidder and the local governments
involved would be able to sustain the network, citing the flaws and problems
that the municipal Wi-Fi systems in Sacramento and St. Cloud, Florida are
encountering.

The bidders have not yet revealed their plans to the public. The winner will
be proclaimed by September 12.

EarthLink has decided to open up its municipal wireless systems to
competitors by allowing them to distribute its service on a retail basis.

The company has no problem with the set up, saying that it does not want to
have a monopoly on wireless Internet.

AOL is expected to benefit from the deal as it is trying to expand its
high-speed Internet service in order to prevent the continuous exodus of its
dial-up subscribers who are now shifting to broadband.

DirectTV will also be gaining from the agreement. By bundling Internet
access to its TV service, it is confident that it would edge out cable TV
firms in attracting new customers.

DirectTV and AOL will be offering Internet access in all the areas where
EarthLink has or is putting up municipal Wi-Fi networks.

The deal will not prevent EarthLink, though, from competing with the two
companies for Wi-Fi subscriptions. It expects that 20% to 30% of its
subscriptions would be from retail clients, while the rest would be taken up
by wholesale partners.

The company is currently in talks with other potential Internet service
retailers in Anaheim and Philadelphia.

The Internet service provider’s Anaheim system covers 6 square miles of the
city’s downtown area.

The network is still a work in progress, though, as EarthLink’s wireless
blueprint involves all of Anaheim. Network coverage will increase to 10
square miles within a month. The company expects to blanket the whole city
with wireless access by the end of the year.

The $22 subscription cost is higher than the $13- $18 rate that other ISPs
are offering in California. However, EarthLink’s service is faster. Its
subscriber could receive or download data at 1 megabit per second, 18 times
faster than the average dial-up connection.

Observers are concerned on the possibility that EarthLink might not be able
to profit from the venture due to the presence of other competitors that
already have established systems in the area.

AT&T Inc. provides DSL service in Anaheim, while Adelphia Communications
Inc. offers cable Internet.

EarthLink officials are undeterred, though. They said that the broadband
market is still mostly untapped.

Around 50% of U.S. households that have Internet access are still using
dial-up. EarthLink is optimistic that these households will choose wireless
Internet over cable and DSL when they’ll opt to shift to broadband.

EarthLink is also currently working on a similar project in Philadelphia,
Milpitas, and New Orleans. San Francisco and Aurora, Colorado also awarded
their wireless contracts to the company.

Invitations for bids and proposals were already sent out for the
installation of a network that would provide Internet coverage to all of
Atlanta.

While city officials are hoping that they would get favorable deals or
proposals from several Internet service providers, the state government has
already laid out a plan to come up with a budget or funding program that
would finance the development of public Internet systems.

The $4 million initiative came from Gov. Sonny Perdue. He made the proposal
during the last session of the state legislature. He said that the state
grant will promote economic development, enhance educational opportunities,
and provide the government with efficient means to reach and serve its
constituents.

Atlanta ranks high in terms of Internet access availability in the south.
However, its networks are not as big and complex as those that are being
planned and built in San Francisco and Philadelphia.

Some groups fear, though, that the government might be moving too fast in
its plan to connect the city online. There are concerns that people might
not use or subscribe to the new municipal service once it is already up and
running.

However, Atlanta officials believe that having a public wireless Internet
network in the city will be very beneficial as it would attract tourists,
residents, and businesses.