A ruling by the French telecom regulator Authorite de Regulation des Telecommunications (ART), could see France Telecom SA start offering innovative net access pricing packages, leaving the nascent subscription-free internet service providers out in the cold.
ART said Monday it would allow Telecom to begin offering flat-rate consumer internet access, whereby the customer pays FFr100 ($16) per month for 20 hours connected to his or her chosen ISP. This could spell trouble for the few dozen subscription-free ISPs which have launched or intend to launch over the next month. Some of these companies are currently in negotiations with Telecom to start sharing the charges applied to dial-up access, following the model pioneered in the UK. If the incumbent telco’s dialup margins are reduced, there will be less potential for giving a cut to the ISP.
ISPs such as Lokace-Online, run by Infonie SA, and UK retailer Kingfisher Plc’s Libertysurf are trying to secure a share of revenues generated in calls to their service. As recent start-ups, these companies hope to initially subsidize their services with online advertising or by running the subscription-free service alongside a paid-for one.
ART has imposed two conditions on the possible pricing plan: that the 20 connected hours be applicable to any ISP that wishes to partake, and that smaller telcos are allowed to offer similar services which pass through FT local loops. Given these conditions, FT has still to decide whether to take advantage of its new-found opportunity, arguing that it could make a loss on internet calls to competing networks.
