The cut-throat battle among Internet service providers took a further turn today with the announcement of BT?s free to connect Click+, but analysts believe subscription services will win out in the end.
With BT Click+ you can access the Internet without registering, signing fixed term contracts or paying a monthly subscription. BT simply adds a penny to your phone bill on Internet calls.
BT Click+ also includes the telephone giant?s free email service, Talk21, Microsoft Internet Explorer browser 4.0 and access to news and information from Line One, BT, News International and United News and Media.
Competing against Dixon?s recently announced free Internet service, Free Serve, BT is charging 50p per minute for Click+ telephone support, against the high street electrical chain?s #1 per minute. Both services are selling themselves on being incredibly easy to install for first time Internet users.
?It is all about choice, the consumer now has more choice for getting on the Internet than a month ago,? commented John Swingewood, director of BT?s Internet and Multimedia Services Division. ?What consumers are getting from Click+ is simplicity of access and the trust that comes with the BT brand.?
Analysts maintain, however, that simply removing a subscription fee to the Internet is not sufficient to guarantee the new big players are successful. "Generally, free services are run on wafer-thin margins and cannot afford to offer free support,? explained Adam Daum, an analyst with market research company Inteco. ?Financing it through premium telephone rates is a barrier to the users for whom a lower-cost service would be most attractive.?
?Non-subscribers, who will need more hand-holding, are wary of racking up high telephone bills - premium rate numbers ring alarm bells for these people," added Daum.
The free services are therefore expected to have a fast churn over of members as many will abandon their accounts rather than pay premium telephone charges to sort them out.
BT is expecting Click+ members to move onto subscription accounts, such as BT Internet, when they become proficient, but not for the reasons analysts underline. ?The whole point is it has been designed to be very easy to use, in trials support calls were minimal,? commented Swingewood.
"We expect people to move on as they require more from the Internet and it would be nice if they stayed within the BT family, but our primary focus as the moment is to grow the market and encourage people to get online," he continued.
Abbey National is to provide exclusive financial services information for BT Click + and will carry its branding on Talk21. Compaq is pre-installing BT Click+ on its Presario PC range. Swingewood confirmed to 'Newswire' that it is in negotiations with other household names and will make further announcements in the coming weeks.
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