Free Internet access is a typical example of how the rules that applied to business have been discarded in the relatively underdeveloped online world.
The good news is that the consumer stands to gain in the short term at least. And while longer-term plans will be hatched to extract from users the money now paid to traditional Internet service providers in subscriptions, ultimately users are likely to end up handing over cash only for services they believe are worth paying for.
The new services launched by Ocean and Gateway this week will provide users with the same degree of access to the Internet as anyone signed up with an existing service provider. Suspicions are generally aroused when a free product or service is offered. In the online world, however, the rules of the game are different. The motivation for free access is quite simple: it's about getting as many people using the Internet as quickly as possible.
The Republic has one of the lowest Internet takeup rates in Europe and development of Internet services has been hampered by the small size of the market.
Mr Barry Flanagan, co-founder of Internet service provider (ISP) Ireland On Line, who recently left to start another Internet venture, says: "The free Internet service model is what lifts all boats in terms of getting people online."
From the consumer's perspective, he believes this to be very positive news. "The free model will only be sustainable over a four to five-year time frame. The aim is to grow from a base of 300,000 Internet users to one million in two to three years.
"In parallel, online services will be developed to generate revenue which will come out of the £10 that used to go on monthly subscriptions."
It is likely the introduction of free Internet access will prompt existing service providers to make similar and more attractive offerings to their customers. As the battle lines are drawn, the real challenge for each ISP is to create a stimulating environment which will attract the attention and transactions of the online audience it is targeting.
Eireann's special low cost 1891 number should be dispelled. These kind of pricing models are second only to the permutations involved in angels dancing on the head of a pin.
For example, Ocean's new service will cost around £2 per hour at peak times against £1 per hour using Telecom's 1891 access. However at off-peak times there will be no difference whatsoever, which is particularly relevant to domestic users the exact market that Ocean is trying to target. Mr Flanagan believes there will be major consolidation in pricing models over the next few months, as ISPs vie to offer free services via low cost telephone
numbers, with possibly a service that is completely free after 6 p.m. and other variations on this theme.
There are concerns about technical support and the costs associated with the Ocean and Gateway offers. Admittedly a £1-per-minute charge is quite hefty, but there is little escaping this, as around 30 per cent of staff overheads for any ISP go on technical support. We need only look to Britain and the success of Dixon's Freeserve Internet service to sample a taste of things to come. Despite initial reservations about Dixon's expertise in the Internet area, within nine months it has become Britain's biggest ISP, and it is continually ranked among the best in the business for service and speed.
This latest development is about getting everyone to the market, which is good news for anyone wanting to get online. The next step will be getting customers to fork out for what's on offer - a different ball-game entirely.
