America Online is to fight discount ISPs by launching its own cut-price service in the US, according to reports this week.

The embattled internet giant is planning a new dial-up web offering costing around $9.95 (€8.56; £6.00) a month – a similar level to its no-frills rivals and well below the $23.90 it charges for its flagship dial-up service.

However, to protect the AOL brand, the group will use the moniker Netscape for the discount ISP, resurrecting the name of the web-browsing pioneer it purchased in 1999. The new offering will be stripped of many of the extra features enjoyed by subscribers to the flagship service, such as multiple email addresses.

The move is an attempt to fight off the advances of budget operators, which offer dial-up connections far cheaper than AOL's. The online giant has tried to justify its higher price by adding extra services and content.

Data sourced from: The Wall Street Journal Online; additional content by WARC staff