SmartPay says its preferred delivery model for wi-fi hot-spot services is free to the end user.
The NZX-listed company, which recently inked a deal to manage Telecom’s wi-fi hotspot network, says the charging model used in any site is up to the retailer that hosts the site.
“Ultimately somebody needs to pay for service, but our preferred model to the end user is free,” says Steve Smith, SmartPay’s chief operating officer.
SmartPay’s recent moves, which include the purchase of wi-fi provider Fivo from National Communications in December, are aimed to position the company as an integrated merchant services provider.
Smith says venues offering the service have to be able to ascribe value to providing it. Where Fivo sites didn’t generally get a portion of the revenue from providing wi-fi service, SmartPay does share a portion with the site owner.
That said, Smith says site owners are usually far more interested in building customer loyalty through such services than in receiving direct revenue.
The sites are also about to get a lot more prominent, with SmartPay finalising in-store branding to alert customers to service availability. The new service brand will be “Smartsite”.
Smith says SmartPay’s aspirations are to create a contiguous network. He says common log-ins are already in place between the wi-fi systems and SmartPay’s Hotzone service, provided in association with Kordia.
SmartPay’s partners in delivering wi-fi services are a who’s who of New Zealand and global brands, says CEO Linc Burgess. He cites Mitre 10, Palmers, PaperPlus, VTNZ, Vodafone, Telecom, TelstraClear and Starbucks among others.
Burgess says the drivers of success on the wi-fi side will be first the number of sites and site partners, then the number of visitors using the sites and finally the ARPU (average revenue per user) achieved.
Also driving adoption is the proliferation of new internet capable mobile devices. Wi-fi capable mobile phones, MP3 players and devices such as the Playstation Portable are proliferating as well as wi-fi capable iPods and iPhones.
He says the site is a place where service is delivered but also where offers can be made electronically to customers. SmartPay’s online payment gateway facility and voucher technology allows easy fulfilment of such offers at the merchant level.
The company is also offering wireless merchant IP services, allowing retailers to effectively eliminate one telephone line currently dedicated to Eftpos — and save money in the process. Merchants don’t need to change their terminal equipement to do this, Smith says.
Smith says SmartPay has reciprocal interconnection deals with 120,000 international hotspots. “We’ve had calls last week from international operators looking for points of interconnection,” Smith says. “The revenue opportunities are not insignificant.”
SmartPay now has around 500 sites including those on the Telecom network.