Up to 8.8 million US online households are expected to turn to free access ISPs by 2003 according to a report from research firm Jupiter Monday.
While the free access model is threatened in the UK by BT's decision to introduce unmetered access, Jupiter believes 13 percent of the online consumer market will use free ISPs in three year's time.
Zia Daniell Wigder, senior analyst at Jupiter and an author of the report, believes free ISPs will not overtake subscription services but will be extremely popular, mirroring multiple ISP use in the UK. "Growth of the free ISP market is expected to continue at a fast pace, but cannot be compared with growth in paid ISP services. Consumers will maintain several free ISP accounts simultaneously, but are likely to use only one or two on a regular basis," she said.
In order to survive, Jupiter believes American ISPs will rely on advertising revenues. But with the research firm predicting free ISPs will capture just eight percent -- or £540m -- of the total online advertising spend, they will have their work cut out. ISPs will have to provide advertisers with a highly targeted user base in order to survive, Jupiter believes.