MSN 8 blitz aims to steal AOL's thunder

IDG News Service - Microsoft Corp. kicked off what will be a $300 million marketing blitz for its new MSN 8 Internet access software today, one day before rival America Online Inc. is set to launch version 8.0 of its software in what has become an Internet service provider (ISP) showdown.
Although Microsoft's media campaign won't officially begin until it launches MSN 8 on Oct. 24, the software giant planned to rain marketing money on AOL's parade with an MSN 8 event in Superior, Wis., today -- to show off its "superiority" -- while simultaneously unveiling a massive billboard in New York's Times Square.
The media bonanza, which includes online, print, broadcast and radio ads and will run until mid-2003, is a sign of just how serious Microsoft is about gaining traction as an ISP. In fact, the campaign doubles the amount of money Microsoft spent when it launched MSN 7 last October, according to MSN product manager Parul Shah.
The hefty investment is meant to show off what Microsoft believes is a major update to its service.
"We've made some significant headway with this product," said Shah, who mentioned that the company did extensive consumer research and even took anthropologists into consumers' homes.
The campaign also has another specific goal: to get users to switch ISPs.
The software giant disclosed its latest membership figures for MSN today, claiming 9 million subscriptions, up from the 8.7 million it reported in July. While reflecting steady growth, the MSN numbers pale compared to AOL's more than 35 million subscribers.
Microsoft hopes to change all that, however, with a campaign featuring the slogan "It's Better With the Butterfly," which plays on the service's butterfly logo.
The campaign aims to demonstrate that MSN 8 solves common user complaints about ISPs by offering less spam, more effective parental controls and better browsing, the company said.
"The primary difference between updates from AOL on their products is that the changes they make are fairly cosmetic and superficial, but with MSN they are significant advances that actually make the products more useful," Shah said.
Adding to the rivalry between the two ISPs, with the rollout of MSN 8, Microsoft will launch a stand-alone version of its service that's cheaper than AOL's offering, Shah said. Microsoft's stand-alone product, which offers MSN content services but no Internet access, will be priced at $9.95 a month, compared with $14.95 a month for AOL's stand-alone service.
The official unveiling of MSN 8 will take place in New York's Central Park with a live performance byrocker Lenny Kravitz. AOL 8.0's official launch is set for tomorrow, when the company will stage its own ritzy New York event.