Broadband Shenanigans

The broadband race is making a U-turn, as Web giants such as Yahoo, MSN and now America Online head away from plans to run their own high-speed Net access services and move toward branding partnerships with the Baby Bells and other heavyweights.

Faced with economic realities and the reluctance of broadband providers to rent their pipes for "leased-line" services, AOL and the others hope to package their Internet products as a front end for services essentially run by their network partners.

AOL announced plans along those lines last month, falling in behind Yahoo and MSN. And analysts believe such partnerships are likely to take off next year, fueling growth in an industry that has faced high costs for both providers and consumers.

"I think 2003 has to be the year that a large portion of the transition to getting more broadband access for Internet services comes forward," said David Joyce, an analyst at Guzman & Company.

The impact on consumers is not yet entirely clear, but analysts said the trend bodes ill for dial-up Internet providers such as AOL and Microsoft's MSN, which may wind up playing only an auxiliary role in the coming broadband world.

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