Major ISPs are piling on services to gain new business instead of simply cutting the cost of providing basic internet connection.
“Internet access itself is nothing more than a commodity these days. We have to add to that to make it worthwhile,” says Telecom spokesman Glen Sowry. Telecom's Xtra service, New Zealand’s largest ISP, offers a variety of packages to users that include not only additional email addresses and web hosting, but also discounted long-distance phone calls.
Ihug is also looking to add services rather than fighting another round of price wars.
“We’d consider perhaps charging users more for spam filtering or for additional virus protection, things like that," says director Nick Wood. "Adding services on top of the existing offering is the way we see things going,” Wood has been in talks with anti-virus software vendor Trend Micro which offers a package designed to block viruses at the ISP level rather than at the desktop.
“Users would basically outsource the whole virus problem to the ISP,” says Trend Micro country manager Joel Montgomery. He says the licensing model would be based on Trend Micro taking a cut for each subscriber signed up to the offering — ISPs would in effect act as value-added resellers for the product.
Clear, meanwhile, provides Zfree, a no-cost internet access that charges users for help desk calls, and Ztalk, which offers toll calls billed in 15-minute blocks with calls to directory or the operator being charged at a higher rate.
“There’s definitely a move to these kinds of services,” says spokeswoman Rochelle Lockley. She believes ISPs will still offer the flat-rate services they offer at the moment, but will expand their offering at the higher end.
“We’ll see users taking on higher speed connections, but perhaps not needing an increase in support, so they would pay a different price to those that do need the support.” Lockley sees this fragmenting of the market as part and parcel of the broader range of users now online.
“Some need higher levels of help, others are happy configuring their own POP settings, that sort of thing”.