Ihug acquires two Australian ISPs

Ihug has made its most significant move since the announcement of its proposed merger with Force Corporation, taking a controlling interest in two Australian ISPs.

Ihug has made its most significant move since the announcement of its proposed merger with Force Corporation, taking a controlling interest in two Australian ISPs.

The acquisitions are relatively modest, adding 10,000 to Ihug's subscriber base, but they indicate the company's focus on driving up customer numbers by a range of means this year.

Ihug marketing director Tim Wood says the initiatives will significantly increase the company's points of presence (POPs) in the Australian market.

"Growth by acquisition is an important part of our long term strategy," he says. "As the Internet market inevitably rationalises to a small number of big players we believe it is critical that we continue to expand our reach and accessibility."

As part of what it describes as "aggressive growth plan", Ihug has taken a controlling stake in One Earth, an ISP based in Wollongong on the South Coast of New South Wales. Under Ihug's direction it will expand its coverage area from South Sydney to the Victorian border and Wagga Wagga, which Ihug says will give it access to an additional 500,000 potential customers.

The second acquisition is Interweb, a South Australian company based in Adelaide and Gawler, which has around 5000 active subscribers and a coverage area encompassing 1,000,000 potential customers. Like One Earth, it also offers Web development and hosting services to local businesses.

Both ISPs will offer the full range of Ihug products, including Satnet, Ihug's high-speed satellite service. Their reach into rural markets may be key here - the Australian company Austar has concentrated on delivering a similar high-speed service to rural areas which lack the cable infrastructure of Australia's main centres. Both will also offer Ihug's distance calling phone services.

Back home, Ihug has begun restructuring its local Satnet service with greater emphasis on home users, removing it from the company's business division and conducting a customer survey.

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