AOL Europe and Verio Extend Exclusive E-Commerce Provider Agreement

One day after trumpeting the launch of a subscription-free Netscape Online service in the United Kingdom, America Online (NYSE: AOL) announced that it has extended an e-commerce and web-hosting agreement with Verio, Inc. (Nasdaq: VRIO).

AOL Europe said that its exclusive marketing agreement with Verio will bolster the Englewood, Colorado-based company’s presence in the UK. Verio will be the featured e-commerce and web-hosting provider on the site, linked prominently through strategically located banner advertisements and static buttons.

“Through our previous exclusive marketing agreement, Verio proved to be an outstanding partner for AOL UK,” said AOL UK Managing Director Karen Thomson. “We are pleased to extend our relationship with Verio through Netscape Online by offering Verio’s high-quality e-commerce, Web-site hosting and domain name registration services as an excellent complement to our own breadth of Internet services.”

The company said Netscape’s new free UK service targets the “value conscious” segment of UK Internet users and features Netscape Navigator browser access to the Web and a variety of online activities.

Opening New Markets

Like many in the e-commerce industry, AOL, Verio and others are seeking larger market shares outside the United States. AOL’s UK service is a push to establish a presence in Europe’s second-largest Internet market.

Verio is clearly hoping to ride on AOL’s coattails. One of the leading Internet and business e-commerce providers in the marketplace, Verio has been aggressive in recent months in building up its business.

The company raised $360 million (US$) in a convertible preferred offering earlier this year and spent $100 million to buy digitalNation, a hosting provider.

It also opened VerioStore, an e-commerce site that offers hosting for prices as low as $24.95 to small businesses. Top-end prices range up to $3,200 monthly for sophisticated hosting services.

Verio hosts 265,000 Web sites on its servers, including 50,000 in the European market. The company has also registered some 400,000 domain names.

Earlier this month Verio announced second quarter sales of $62 million, up 117 percent from 1998.

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