Former Xtra boss Chris Tyler has headed his Australian ISP, Access 1, into a potential price war with its plans to pull the rug out from under its key rivals with a new service that will undercut the current market price point by as much as eighty percent.
The new service, called Access 2, was the focus of a joint announcement between Access 1 and Solution 6 at last week's Interact Multimedia Festival in Melbourne.
The service will specifically target experienced Internet users prepared to sacrifice "premium quality" for a "low, low"; price, company officials said.
The cost of the service is A$19.95 (US$13.75) for 20 hours a month with an additional A$1 for each hour thereafter.
According to Bryan Rowe, Access 1 general manager, strategy, marketing and sales (and another Xtra veteran), the company has conducted a scoping study which indicated that price was a major concern amongst the top percentile of regular Internet users.
He added that while many business and first time users require a premium service guaranteeing full 24 hour support and reliable connections, the growing number of Internet savvy users - both small business users and individuals - is creating new market demands.
Users interested in Access 2 will have to accept slower performance and more "busy tones" in return for low charges. The service will offer: 33.6Kbit/s, not 56Kbit/s modem access; managed as opposed to "uncongested" international bandwidth; online and 1900 phone support only. Registration is accepted online only and must be done via credit card.
Rowe refused to comment on whether the new service is likely to trigger a price war within the Australian ISP market, but said that Access 2 will be aimed at wooing price conscious users from the "top two" Australian ISPs.
He added, "Other ISPs will find it difficult to follow [our lead] immediately."
The company also said that the new service will require little initial or ongoing investment, as according to its own research, experienced users are by far the cheapest to support. The service will borrow some of the existing Access 1 infrastructure, but will be equipped with its own dedicated lines, Rowe added.