LARGO's sudden doubling of fees upsets its many newsletter clients, some switch to Infocon.

The decision last month by Application Programming and Development Inc. (APDI) to more than double the rates for its Largo internet services, upset scores of newsletter and specialized information publishers around the country and sent many scrambling to look for a new internet service provider.

NL/NL received calls from a number of publishers using Largo who were disturbed by the action taken by APDI, one of the industry's leaders in internet services for publishers.

Many were notified by letters delivered by Federal Express in early January of a new rate schedule that in some instances would increase their rates by up to 150 percent. The letter indicated that the new rates would be "effective immediately" and that "payment at this new rate and any fees in arrears" must be received by January 26.

The letter stated that APDI would deliver a new contract within seven days and that "failure to remit payment of this new fee and fees in arrears by Jan. 26 will force us to shut down your Largo system." However, at this time it appears that APDI has not shut down the sites of any publishers who have declined to sign new contracts.

What impact this decision to dramatically raise rates will have on the operation of APDI is unclear.

NL/NL tried unsuccessfully to contact APDI president Mark B. Burnett. However, it was learned that more than half the staff at APDI's location in Camp Springs, Maryland, have left.

Some publishers told NL/NL that they felt the action taken by APDI was a breach of their agreement, since they had recently signed new contracts which contained a ceiling on any rate increase that could be charged by APDI.

The letter from Burnett stated that while APDI "has made substantial improvements in the Largo service over the past year" this has been a "two-edged sword."

"End-user readership and transaction volume has increased geometrically, and that is very good news for publishers and sponsors, the letter stated. But "the consequences of this 'success' are straining APDI's ability to provide increased support (bandwidth, customer service interaction) under old pricing schedules geared to much lower volume.

"Due to the heightened expense of running Largo service, APDI will for the first time have to increase its rates in order to continue running Largo service. APDI is increasing the rates for all its customers at what we believe to be a fair amount based on technical support, development, maintenance, etc."

Infocon America picks up the slack

The fallout from APDI's decision appears to have helped Infocon America Corp. of Los Angeles, which a year ago merged with NewslettersOnline/Impresso Inc. (NL/NL 2/15/00). Some publishers have switched to Infocon for those services previously provided by Largo.

Infocon president and CEO Mark Hartsell declined to comment on the action taken by APDI but did say that they had picked up some publishers who were previously using Largo.

One of the big publishers that is leaving APDI is the Institute of Managment & Administration (IOMA), a subsidiary of the Bureau of National Affairs, which publishes 59 newsletters, 30 year books and more than 50 research reports.

IOMA president David Foster said that his company was "generally a happy LARGO customer" but that IOMA was looking for additional "bells and whistles" to upgrade the functionality of its web sites.

When APDI decided to increase its rates IOMA decided to switch and notified APDI that "it's been great working with you but we need new services... best of luck but we're moving."

Although IOMA did not sign a new contact before the Jan. 26 deadline, Foster said that "Largo has been nice enough to keep our web site up and running. They are not leaving us in the lurch...and have done their best to cover us."

IOMA has a business relationship with three other providers--Infocon, Ecnex and Bell and Howell--and it plans to expand its relationship with Ecnex and Infocon.

APDI 6805 Coolridge Dr., Camp Springs, MD 20748, 301-449-1400, fax [phone], www.apdi.net.

Infocon, 4001 Westerly Pace, Commerce Plaza, Newport Beach, CA 949-250-4560, fax [phone], www.infoconamerica.com.