Bundling up: Qwest packages long-distance with free Internet access

Qwest Communications' Internet/long-distance bundle, announced last week, is drawing mixed reactions from industry analysts. The package combines 250 minutes of long-distance calling with free unlimited dial-up Internet access for $24.95 a month. Calls beyond the first 250 minutes are 10cents a minute.

The offer showcases Qwest's focus on converging voice, data and images, said John Taylor, Qwest's senior vice president of consumer markets. "We have developed a suite of Web-enabled service enhancements. Logically the next step is to bring together the traditional voice long-distance with our Internet service," he said.

But considering the other bundles available, Imran Khan, an analyst with Frost & Sullivan, was less than impressed with Qwest's offer.

Khan questioned the package price, which he said comes out to a dime a minute for long-distance calls. Last week, MCI WorldCom announced 5cents a minute calling on weekends and between 7 p.m. and 7 a.m. weekdays for a monthly fee of $1.95.

Khan also doubted whether dial-up Internet will appeal to customers who would purchase an Internet/long-distance package. "Most of the people who are going for these bundled type services are high-end consumers who have long-distance, wireless and Internet access. They're more into high-speed Internet access, something like DSL."

But a surprising number of consumers do not yet have computers or Internet access, said Howard Horowitz, president of Horowitz Associates Inc. "It's 10cents a minute; you're signing up front for 250 minutes, [and] competing Internet is $20," he said.

While Khan worried that Qwest does not have the brand awareness to make an impact, Horowitz said Qwest has the potential to succeed with this offer if it has a brand marketing campaign behind it.

Qwest's success or failure hinges on long-distance, Horowitz added. "If their long-distance is priced right and has value added for Internet, then they've got a good package."