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BlueLight.com acquires free Internet provider

Kmart debating on whether to charge for Internet service

Marvin Lazaro -- Home Textiles Today, December 11, 2000

SAN FRANCISCO -In a move that will ensure continued free Internet service for millions of websurfers, BlueLight.com announced the acquisition of selected assets of Spinway Inc.

The Sunnyvale, CA-based Spinway was providing free Web access to roughly 6 million users, most of whom had signed up for Spinway's services through BlueLight. Spinway had laid off the last of its employees on Dec. 1 and appeared to be ready to shut its virtual doors until BlueLight acquired its assets.

BlueLight.com is an independent e-commerce company majority-owned by Kmart.

Effective immediately, the assets needed to maintain Internet service for approximately 6 million surfers will be taken over by BlueLight. The assets will be absorbed by the company and will function as a unit within Kmart's e-commerce channel. Key employees will also be retained and Spinway's network of Internet dial-up providers will also be maintained. Spinway itself will cease to exist as a company.

The San Francisco-based BlueLight is debating, for now, whether to charge for Spinway's service as early as next year, a move coined as a "necessary marketing expense" by BlueLight.com spokesman Dave Karraker if it did happen.

Said Mark Goldstein, ceo of BlueLight, on the deal, "The cost of acquiring the core assets of Spinway was very modest for BlueLight and will have little impact on our current march towards profitability. BlueLight's Internet service is an invaluable marketing tool for the company and we feel it is in our best interest, and in the best interest of all our subscribers during these tough times for pure-play dot com companies, to make sure it continues."

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