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20th January 1997
What If?
Over the past 12 months we've seen a huge drop in the cost of Internet access here in NZ. While we're not quite at the $19.95 per month flat-rate level, it's still a lot cheaper to shuffle around cyberspace than it used to be.

But... what if it were completely free?

Sounds too good to be true? Maybe not. Overseas, several companies are trying out totally advertiser-funded Internet access services. At the vanguard of this market is Hyper Net Inc, a company which has been trialing its service in Japan prior to full-scale implementation in the USA.

To join up with Hyper Net, users pay a one-time fee and in return get a customised browser and unlimited Net access. The only burden from the user's perspective is the bit of screen-space they give up to a constant stream of advertisements, not too much of an inconvenience is it?

Now imagine if one of the big NZ Telcos got ahold of this concept and implemented it here in NZ... how big a share of the market do you think they'd get? Pretty near to 100% of the personal Net access market, that's for sure - although many users would retain their existing ISP accounts for emergencies and "luxury" surfing.

But would it pay?
Let's do some simple sums...

Let's suppose that an advertiser pays ten cents for a fifteen-second spot on your browser's advertising window (a pretty reasonable rate). That gives a revenue of $2.40 an hour - which isn't too far away from the existing rates charged by the Telcos. A CPM (cost per thousand) of $100 isn't too far out of line for some advertisers either, especially when you consider the demographics of the average Net user and the fact that this advertising could be very accurately targeted to a specific user's preferences and interests.

Of course, it would need a lot of capital to build a system large enough to meet the demands of the market, but the Telcos would have that much money available to them anyway.

Would it pay?
Would it be fair?
What would the Commerce Commission say?
There's probably not a lot they could say. This is a whole new business model and therefore not directly competing with the traditional ISP marketplace. It would be like comparing free to air TV (totally advertiser sponsored) with subscriber TV (where the user pays for their access).

I'm sure that this argument could be used to successfully defend the introduction of a "free Internet" service, after all - Sky TV seems to make a very healthy profit in the face of up to five other free-to-air TV channels.

But will it happen?
Not for quite some time, if ever - which probably comes as somewhat of a relief for many ISPs.

Why not?... the market, in NZ anyway, is still far too small. TV has the ability to reach a very high percentage of all the homes in New Zealand and it's a medium which is already well understood and accepted by the ad industry. By comparison the Internet-user community here represents just a very tiny percentage of the population and it's very unlikely that anyone, regardless of their percentage of market share, could convince advertisers to part with the necessary advertising dollars.

In fact, it's possible that even the US market may not yet be big enough. The latest news from the states indicates that Juno.com, the pioneering company that offers completely free, advertiser sponsored email access is having problems. They announced this week that they would be dropping their toll-free access, replacing it with local numbers in a much smaller number of centres. As with all good ideas, timing one's entry into the market is every bit as important as having the right product.

ISPs can sleep soundly
Let's be nosy...
Want to snoop around a little?
Here's a fun little site if you are a nosey sod and are looking for some useless information about your favourite Web site, or your competition.

NetCraft is a where you'll find this little piece of net snoopery, along with some of the statistics it's come up with.

They do things different in the USA
The news wires have been running hot this week with tales of woe regarding America Online. They were caught out with unexpected demand for service when they dropped their prices to $19.95 per month, flat rate.

Now subscribers are having trouble getting a free line, and when they do manage to get onboard, they're often presented with messages such as "maximum number of server requests exceeded", effectively rendering the system unusable.

So what, we've heard similar tales of woe from at least two NZ ISPs who have encountered exactly the same runaway growth in use. The difference is that in the USA, the customers don't just sit around and whine, they get their pet lawyers onto the case and start litigating. Already several individual and class-action suits are pending against AOL for an alleged "lack of service".

Is this a good or a bad thing? Does it mean that we NZers are too laid back, or does it mean that the people in the USA are so used to solving every problem through litigation that it becomes a knee-jerk reaction?

Ready, set, sue!
Guy Fawkes gone mad...
Light the blue touch paper and stand well clear
What sort of stuff do you expect to find people flogging on the Internet? Books, CDs, PCs, software, get-rich-quick schemes and the like all spring to mind.

What sort of site do you think would have a graphic which says "Our Competitive Advantages" stuck smack in the middle of its web page? Hmmm... what ever it is, it must be in a competitive market right?

Well take a look at the ArianeSpace site and see what I'm talking about. You'll find lots of neat MPEG footage there and some details of their products and services.

They are, of course, the people who launch satellites and I never realised that this was a competitive marketplace - but I guess, on reflection, it probably is. Funny thing though.. no mention of the ones that have gone "BANG" and no secure-server with credit-card ordering. Why not? American Express says they don't have a credit limit on their cards!

Feeling smug
Okay, brag time :-) Regular Aardvark readers will know that I also publish a current-events/news site called 7am News. Everyone knows that news is a big drawcard on the Net because its one of the few types of content which changes regularly and has something for everyone. In fact, The Press, NZ's only print-media newspaper to publish an on-line edition is often cited as one of the country's most popular and effective web sites, and it certainly is.

Well I'm very pleased to say that 7am is now drawing over 20,000 hits per day from all over the world - which I believe must put it pretty high up the list of successful NZ-based web sites. The number of hits is still climbing at quite a rapid rate and, surprisingly, 75% of the traffic is coming from outside of New Zealand. At over half a million hits per month, I think I have good reason to be smug :-)

As many of you are aware, during the past year I've been using Aardvark as a "testing ground" for quite a number of ideas and concepts in the area of Net publishing. I attribute at least some of 7am's success to the constant feedback and comments I receive from Aardvark readers who are quick to praise what works and even quicker to critique that which doesn't. I consider another key factor in 7am's success to be the way that so many other sites have co-operated by providing access to their content. These sites are now benefiting from the arrangement by way of a regular stream of 7am readers arriving at their pages. It's just a shame that some NZ content providers and web-sites weren't interested in joining in and getting their share of the action.

600,000 hits per month!

I Can't Believe It's True!
There are lots of really bad pages on the Web. Mostly it's because people use ugly colour schemes or simply don't know how to create half-decent HTML. This site has a little bit of everything, hideous font-choices, garish colours, broken images, and the most abstract and confusing order form layout I think I've ever seen. I hope their print-publications are a little better!

a'Court's Business Handbook

"Yesterday I couldn't even spell "Web Designer", now I are one!"
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