COMPUSERVE SPRINGS FOR SPRY

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CompuServe last week made an end run around America Online, acquiring Internet software provider Spry and announcing it would be the next major commercial online service to introduce its members to the World Wide Web.

CompuServe said it will begin offering subscribers free one-button Web access within 30 days, beating AOL, which won't introduce its own browser until late April or early May.

The Internet has quickly become fertile territory for commercial online services seeking to boost their subscriber base. Prodigy began offering its own Web browser in January, while AOL acquired three companies, Booklink Technologies, Advanced Network & Services and Navisoft, to assist its own Internet strategy.

"The Internet is the catalyst for growth of online services in the '90s that the PC was in the '80s," said CompuServe President-CEO Maurice Cox. "We think the market is going to grow tremendously .*.*. Having the expertise and assets of Spry is a big help."

Under terms of the $100 million deal, Seattle-based Spry will be the foundation of CompuServe's new Internet Division; Spry President David Cook becomes exec VP of the division.

Spry markets several products, including Internet-in-a-Box, the No. 1 retail Internet access software.

AOL will start testing its Web browser by the end of the month, a spokeswoman said. Subscribers will be able to download the browser free starting about a month later.

CompuServe also intends to use Spry's expertise to create Web home pages for marketers and others. Spry owns 50% of Free Range Media, a Seattle multimedia developer that has done work for IBM Corp. and MCI Communications Corp.

Some of the first Web page clients could be tenants in CompuServe's Electronic Mall.

But some say CompuServe's entry as an Internet access provider should be watched carefully.

"By distributing software to CompuServe users and also to Internet-in-a-Box at retail, they could go to No. 1 in Internet access providing," said Mary Modahl, senior analyst at Forrester Research, Cambridge, Mass. "CompuServe has a much bigger [subscriber] base than Prodigy."

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