Telecom Italia, the Italian incumbent telco, has moved to head off competition from independent internet service providers, and launched a subscription-free internet access service. Tin.it, the telco’s ISP unit, will launch the free service, ClubNet, this week, as well as a new paid for service, Premium.
The launch comes five months after Sardinia-based telco Tiscali SpA brought subscription-free access to Rome, Milan and Sardinia with its Tiscali Net service, shortly followed by Infostrada SpA’s Libero service. These services use the business model pioneered in the UK by the likes of Freeserve Plc, where the ISP is subsidized with a share of interconnection revenues created when carriers pass dialup traffic.
Although Telecom admits that so-called free ISPs now have the dominant business model in Europe, it will still try to hold onto some of its valuable fee-paying subscribers. The Premium service includes faster connection speeds and international bandwidth priority, plus a larger web space account and the ability to send emails with attachments of up to 10MB. Italia said it was targeting Premium at professional users and small and medium enterprises (SMEs).
The launch signals the mainstreaming of the subscription-free concept in Italy. Telecom reckons it has over 50% of the nascent internet access market, with some 650,000 subscribers. The company estimates the total Italian market will suport around 3 million accounts by the end of the year.
