June 8, 2001
Two companies that started out giving away their Internet access service have congealed. A merger of the titans it's not but together NetZero and Juno will have seven million subscribers, making the new venture the second-biggest Internet provider. Problem is, only one million of those customers are paying for the service.
The merger solves some pressing problems for each company. Juno was running out of cash even though it had 910,000 paying subscribers. NetZero had plenty of cash but only 116,000 paying customers.
Michael R. Goldston, CEO of NetZero, called the merger "a real shot in the arm." But some observers weren't impressed. "When you add more weight to a sinking ship, it just sinks faster," EarthLink President Michael S. McQuary told The Wall Street Journal.
The new company, United Online will be housed at NetZero's offices in Westlake Village, CA.
