Prodigy

The IBM and Sears online service with the blue screens and the ads at the bottom, two million subscribers before the web, sold and sold again

Shut down
19902026

Prodigy was a consumer online service launched in September 1988 by Trintex, a joint venture of IBM and Sears (CBS had left in 1986), offering news, weather, shopping, banking, games and bulletin boards over dial-up with a graphical interface and advertising along the bottom of every screen. It reached about two million subscribers, was sold to International Wireless in 1996 and relaunched as an ISP, closed the original Prodigy Classic service on 1 October 1999 and was absorbed by SBC on 1 November 2001.

Timeline [edit]

  1. 1984
  2. 1984 other
    Trintex formed by CBS, IBM and Sears
  3. 1988
  4. September 1988 Launch
    Prodigy launches in three cities

    Graphical, flat-rate, ads on every screen.

  5. 1990
  6. 1990 Launch
    National rollout
  7. 1995
  8. 24 May 1995 Legal
    Stratton Oakmont v. Prodigy

    Moderating makes it a publisher; Section 230 follows.

  9. 1996
  10. May 1996 Acquisition
    Sold to International Wireless

    About $250 million; becomes an ISP.

  11. 1999
  12. 1 October 1999 Shutdown
    Prodigy Classic switched off

    The original service ends, blamed on Y2K.

  13. 2001
  14. 1 November 2001 Acquisition
    SBC completes its purchase

    The brand disappears into SBC Yahoo! DSL.

The site through time

Browse prodigy.com as it was, via the Internet Archive's Wayback Machine:

1988 1990 1992 1994 1996 1998 2000 2001 Full archive →

Ownership [edit]

IBM and Sears (Trintex) 1988–1996 Founded CBS left the venture in 1986; more than a billion dollars invested
International Wireless 1996–1999 Acquisition About $250 million; backed by Carlos Slim; relaunched as Prodigy Internet
Prodigy Communications (public) 1999–2001 other IPO February 1999; SBC took 43% in 1999
SBC Communications 2001–2002 Acquisition Folded into SBC Yahoo! DSL; the brand ended in 2002

Key figures [edit]

MetricValueAs ofConfidence
Registered accounts ▲ 2 million 1994 Reported Peak subscriber count in the mid-1990s

Confirmed official figures · Reported media, cites a source · Estimated analyst or our estimate

Why it shut down [edit]

Official line: SBC Communications, which already owned 43% of Prodigy and used it as the ISP for its DSL customers, offered to buy the rest in September 2001 and completed the purchase on 1 November 2001, taking the company private and folding it into what became SBC Yahoo! DSL. The original Prodigy Classic service had already been switched off on 1 October 1999, blamed on the Year 2000 problem, and only the Prodigy Internet dial-up business and the prodigy.net mailboxes remained. IBM and Sears had sold the company for $250 million in 1996 after spending more than a billion on it.

Our analysis: Prodigy was the first online service built for ordinary consumers, with graphics, flat-rate pricing and shopping, and it lost on all three fronts: its graphics were slow, its flat rate had to be abandoned when people used email more than shopping, and its owners never made money from the merchants. It was also the service that learned, in court, that moderating its bulletin boards made it a publisher, a decision that helped produce Section 230. By the time the web arrived Prodigy was an ISP with a famous name, and ISPs with famous names got bought by phone companies.

History [edit]

Videotex for the family

CBS, IBM and Sears formed Trintex in 1984 to build a home information service; CBS dropped out in 1986, and IBM and Sears launched it as Prodigy in Atlanta, Hartford and San Francisco in September 1988, going national in 1990. It was unlike CompuServe or GEnie: a colourful graphical front end drawn with NAPLPS, a flat $9.95 a month instead of hourly charges, and a business model that assumed the money would come from advertisements along the bottom of every screen and a cut of the shopping and banking done through it. Prodigy had news, weather, Dow Jones quotes, airline booking, encyclopaedias, games, an early web-style bulletin board system and, from 1989, email.

It grew to about a million subscribers by 1991 and two million by the mid-1990s, second to America Online, and it made a great deal of history along the way: it was the service accused of reading members' private files, the one that introduced fees for email after members sent too much of it, and the one whose moderated boards led a New York court, in Stratton Oakmont v. Prodigy in 1995, to rule that it was a publisher and liable for what its users posted, the case that prompted Congress to write Section 230. It also spent IBM's and Sears's money at a rate that alarmed both; estimates of the investment run past a billion dollars.

ISP, then SBC

In May 1996 IBM and Sears sold Prodigy to International Wireless, a group backed by Carlos Slim's Telmex, for about $250 million, and the new owners turned it into an internet service provider, Prodigy Internet, in October 1996, launching in Mexico as well. The old proprietary service lived on as Prodigy Classic until 1 October 1999, when it was closed with the Year 2000 problem given as the reason; the company had gone public that February. SBC Communications bought a 43% stake in 1999 and made Prodigy the ISP behind its DSL service, then bought the rest in the autumn of 2001, completing the deal on 1 November 2001. The brand disappeared into SBC Yahoo! DSL in 2002 and, later, AT&T; prodigy.net email addresses persisted for years, and Telmex kept the Prodigy name in Mexico as Prodigy Infinitum into the 2010s.

The domain today

prodigy.com redirects to Prodigy Education, an unrelated maths game for children. prodigy.net does not resolve.

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AOL Dial-Up The modem noise stopped, AOL did not 1991–2025 MobileMe The Apple service Steve Jobs apologised for 2008–2012 CompuServe The internet before the internet 1979–2009 Pocket Eighteen years of saved-for-later, gone before you read it 2007–2025 Google Cloud Print Print from anything to any printer over the internet: ten years in beta, then switched off at the end of 2020 2010–2020 Cortana Microsoft's assistant, named after a Halo AI, retired for Copilot 2014–2023

Sources [edit]

  1. Prodigy 20 years ago today Vintage Computing and Gaming 1 September 2008 [archived]
  2. At age 9, Prodigy on-line reboots The New York Times 8 November 1993 [archived]
  3. Sears, IBM near a deal to sell Prodigy The New York Times 8 May 1996 [archived]
  4. History of Prodigy Communications Corporation FundingUniverse 1 January 2002 [archived]
  5. Prodigy to pull plug on Classic service InternetNews 19 May 1999 [archived]
  6. SBC completes tender offer for Prodigy U.S. Securities and Exchange Commission 1 November 2001
  7. Prodigy introduces dial-up service EBSCO Research Starters 1 January 2020 [archived]

Last verified: 16 August 2026. Spotted an error? Suggest an edit (corrections with sources are reviewed and applied).