Rival ISPs force BT to offer free service
Industry trend sees companies climb down over charging users.
BT has scrapped its 'pay as you go' charge for its Click service to keep in line with ISPs that are offering a free service.
Launched in October 1998, BT Click charged one pence a minute and was quickly followed by co-branded services from Excite, Yahoo and Lycos-owned Tripod.
At the time BT justified the charge for the service, maintaining that customers would choose to pay for premium content over that supplied by free services such as Dixons Freeserve, which was launched a few weeks prior to BT's service.
BT Click will be renamed Clickfree and will include personalised content from portal site Excite, the UK subsidiary in which BT bought a 50 per cent stake last year. BT Internet, the telecoms giant's last remaining paid-for service looks set to remain at #11.79 a month. However, there was a question mark placed over the future of the co-branded Click services.
A representative of BT Internet denied that the decision was an admission of failure of the Click service, maintaining that it was instead an example of how fast the market moves. 'You and I have no idea where the market is going in six months,' he said.
A number of internet services have recently joined Dixons' Freeserve, including Arsenal football club and Tesco, all providing a free service as non-traditional ISPs scramble to get a share of the burgeoning internet market (PC Dealer, 3 February).
Over the past year, the ISP market has seen a different breed of virtual internet providers (VIPs) emerge, which resell their services to any business wanting to offer internet access to customers.
Meanwhile, Uunet was also attempting to move into the rapidly growing free internet access market with the launch of a service that has been tailored specially for companies wanting to offer it to their customers.
Uunet supplies internet services to businesses such as Barclaycard, Legal & General, Royal Mail and Thomas Cook, rather than targeting consumers directly itself. Launched last week, the Uudial VIP internet management service enables such companies to build on existing brand and customer loyalty schemes via the Net.
Joe Clift, marketing director of Uunet, said: 'The incentives for customers to go online will be to benefit from the variety of products services and facilities on the Websites of our corporate customers.
'These large multinational organisations are remodelling their business to take account of the globalisation that the internet is driving,' he added.
But with the multitude of free services available, ISPs are attempting to look for ways of making money through banner advertising and technical support calls, as well as through specially targeted promotional deals. This would enable suppliers to both use the internet as a sales channel, but also control it by presetting consumers to incentives that are only available to its own customers.
As a result, Uunet expects that, in the future, the typical online consumer will pick and choose a handful of free ISPs, using them as and when they want to take advantage of a special offer.
YAHOO PULLS IN SMALL BUSINESS USERS
Yahoo is attempting to further extend its appeal to small businesses with a set of services that includes a free intranet one.
The move followed the Web portal vendor's acquisition of community site supplier, Geocities, at the end of January, adding to its existing small business products.
As part of its launch, this included Yahoo Store, which allows businesses to create an online store for between $100 and $300 a month, and Yahoo Small Business, an area on its portal that provides business tools and information.
Yahoo Connected Office supplies users with free groupware capabilities, including shared message boards, a shared calendar, customisable news and online chat rooms. Other features include a Web hosting service, called Yahoo Site, which enables companies to set up a basic Web presence and delivers 25Mb of storage space for $29.95 a month.
For an additional $199, businesses can also submit their Website to be considered for inclusion in Yahoo's directory. Traditionally, this service has been free, but Yahoo said the upgrade guarantees that it will evaluate potential sites within seven working days.
Jack Staff, director of e-commerce at Zona Research, said: 'I think this signals a real step into the small business area. It's a natural move for Yahoo to make. There are two main battles now for the big portals such as America Online and Yahoo. One is reaching small businesses and the other is broadband access.'
Yahoo's biggest competitor, AOL, made a head start late last year in reaching out to small businesses when it announced its intention to acquire Netscape. While AOL.com attracts mainly consumers, Netscape's Netcenter portal site is popular with business users.