Here's a story I found that has two interesting facts that I would think would be pro-WaveTop.
The first is that European local phone calls still cost 10 cents a minute. Seems like WaveTop would be great for someone to get the basic news and gossip for free and then log on the net for any additional goodies they might want. I certainly wouldn't want to pay to keep a stock ticker up and running all day :) Granted there would have to be new content and a new signal carrier but still... Perhaps even the technology could be licensed out so someone else can do the dirty work.
Also, there's a quote that says "AOL members spend 80 percent of their time online inside AOL and only 20 percent on the Internet."
Maybe there are not enough Tuner cards out there yet but it would seem that AOL could save a lot of downloading and server time if AOL and WAVO could get together and transmit the daily Core AOL content over airwaves instead of the phone lines. It would probably be separate from WaveTop but it would seem to be a good idea for all parties...atleast to me it is :)
Dave
Has AOL met its Waterloo?
Dixons shakes up ISP market in the U.K. with free access
By Jonathan Miller
MSNBC CONTRIBUTOR
LONDON, Feb. 4 — The British may be, as
Napoleon observed, a nation of shopkeepers but
it is not only generals who know the art of war.
For the past three years nothing has seemed
likely to challenge the inexorable rise here of the
online venture AOL U.K., British progeny of the
global behemoth America Online. Just before
Christmas, a triumphant AOL announced that
with 500,000 subscribers, it was now the biggest
player in the U.K. Internet market. The in-house
rejoicing, however, was premature.
IN AN AUDACIOUS move, Dixons Group Plc, which
most people knew as a dull but hardy retail group selling
everything from vacuum cleaners to microwaves, has pulled off a
startling dawn raid that has left AOL and its other competitors
shaken. Dixons' victory weapon: it entered the Internet service
provider market and cut the price — to nothing. And it claims it
has figured out a way to do this and still make money.
At the Dixons headquarters in an unassuming office park
north of London, secrecy was deemed vital. Nobody got into
the project offices without signing a non-disclosure agreement.
Even guests invited to the launch party last September had no
idea what they were turning up to. Yet not even Dixons, an
organisation with a reputation for bare-knuckled management,
could have dared to expect that its invasion of the Internet
would go so well. Just sixteen weeks later, Dixons has turned
the British Internet scene on its ear.
In Britain, Internet growth has been slower than in America
because, perversely, consumers have had to pay twice for
Internet access. There is the standard monthly fee to a service
provider — AOL, for example, charging between £4.95 ($8)
and £16.95 ($27), depending on usage. Then, on top, there is
the cost of the local telephone call to connect to the Internet
service provider (ISP). There are no free local connections here;
the cost of dialling into an ISP, at a local call rate, varies from
around 6p (10 cents) a minute during the day, to 60p ($1) an
hour at weekends. For anyone spending even 10 hours a month
online, the cost is easily double what an American would pay.
This pattern of double charging for Internet access is
common throughout Europe. No surprise, therefore, that
Europeans lag behind Americans as Net users. No more than
16 percent of Britons have Internet access; in America, the
comparable figure is almost double.
Other than the cost of a local call, Freeserve itself is
completely free of charge. Freeserve offers free software,
free Web space, free unlimited e-mail addresses and free
unlimited access.
The revolution that is promising to change all of this is the
launch by Dixons of Freeserve. Other than the cost of a local
call, Freeserve itself is completely free of charge. There is no
monthly subscription fee. No fee at all. Instead, Freeserve offers
free software, free Web space, free unlimited e-mail addresses
and free unlimited access. There's still the cost of the local call,
though. But that cost is there whether you use the free service or
pay for one. It is therefore not difficult to understand why
Freeserve has been signing up customers at the rate of almost
10,000 a day and now stands, with one million customers, at
twice the size of AOL, its closest rival.
The dramatic launch of Freeserve has become a hot topic
of conversation in the higher councils of the European Internet
industry, as the business planners attempt to formulate their
plans for the next stage of market expansion. Especially
significant: of those signing up for Freeserve, almost half have
been “Net virgins” who have never been online before. That
suggests that by lowering the price hurdles, millions more are
ready to get online.
Says Freeserve general manager, Mark Danby: “The U.K.
ISP market has been held back for years by monthly
subscription charges. Now Freeserve has turned the market
upside down, proving a subscription-free service is what the
U.K. consumer wants. Our million accounts demonstrate that
conclusively.”
Dixons chairman, Sir Stanley Kalms, has calculated that
despite pricing Freeserve at nothing, there is plenty of
money to be made.
Sir Stanley Kalms, the Dixons chairman,
who has never been known previously to give
away a thing, has calculated that despite pricing
Freeserve at nothing, there is plenty of money
to be made. For a start, he has hooked his
company into a deal with the telephone
companies which allows him to share in the
revenue generated by the local connecting call.
The precise split of this revenue is currently the subject of an
inquiry by Oftel, the British telecoms regulator. This revenue
stream is but the beginning, however. Customers now being
delivered to the Freeserve web pages have already made
millions of pounds worth of electronic purchases, Sir Stanley
says. A third income stream is coming from advertising.
“It's a no-brainer,” said one Internet analyst. “The basic
connection proposition for a consumer just dropped from £120
a year plus the cost of telephone connection to zero pounds a
year, plus the same telephone charges there would have been
anyway. What's not to like?”
Consumers plainly love Freeserve; competitors are less
sure. After increasing its customer base by 75 percent in the
previous 12 months, AOL U.K., a joint venture of America
Online and Bertelsmann AG, Europe's biggest media group, has
added just 50,000 customers since the launch of Freeserve. This
is despite AOL's biggest-ever marketing push, including a £6
million television advertising spend.
Rachel O'Neill, the AOL spokeswoman in London, insists
that its subscribers will remain loyal. She says that unlike
Freeserve, AOL offers its members a “community” not just raw
Internet access. Indeed, she says, AOL members spend 80
percent of their time online inside AOL and only 20 per cent on
the Internet. Freeserve may appeal to penniless students
graduating with media studies degrees, she says; AOL is a
community of families with disposable income. As such, she
insists, it is in a different market to Freeserve. Perhaps, although
it is early days.
So far, it is true that none of the existing service providers
has experienced a wave of cancellations as customers desert for
Freeserve. At least half of Freeserve's accounts have been
opened by people who already have accounts elsewhere,
however. Will they continue to pay if they get adequate service
from Freeserve for nothing? The Internet service providers had
better hope so.
The more difficult question for AOL and the other service
providers is this: where is their future growth to come from?
There are strong and credible rumors in London that national
newspapers — including all three of the main national tabloids
— are studying or preparing to offer free servers of their own.
There are also rumors of teams working in Germany on the
launch of free server type offerings.
Some U.K. Internet professionals believe that Freeserve
does not necessarily spell the end of paid-for Internet Service
Providers but that a two-tier market could be opening between
those seeking value-added services including hosting, and those
who will prove to be content with free servers. But others think
it is only a matter of time before the free server concept spreads
and even businesses will use such services. Ultimately, the
question has to be whether it will remain viable for any service
provider to charge a subscription.
IF YOU CAN'T BEAT ‘EM...
A number of Britain's more than 100 service providers are
already reviewing prices and MSNBC has learned that AOL is
already market testing options including a free-access service of
its own.
Other competitors are rushing to copy Dixons. Tesco, the
giant British and European supermarket chain that launched a
paid-for Internet service last year, is suspending all further
subscription charges for the service starting from February. At
least half a dozen other free services have been launched in
recent days. BT is reportedly considering the launch of a free
service for businesses.
All this is interesting even within the limited context of the
U.K., which with some 20 million households is less than a
quarter the size of the U.S. market. But what is happening in
Britain now could be the start of a broader European trend.
Does a free server-led market expansion in Britain quickly spill
across the channel into continental Europe? It would seem, in
time, inevitable. In America, there are those trying to knock the
froth off the top of the Internet market. Here in Europe, where
the consumers have been held back by high access prices, the
big Internet expansion is still to come. |
