Clear to offer free Internet

By CHRIS BARTON

Clear is about to join the free internet trend with the launch of its own service, zfree, hot on the heels of a High Court injunction allowing internet startup i4free to operate.

Clear Communications manager Ross Inglis was tight-lipped about the prospect yesterday, but did not deny the speculation.

"We do have some exciting developments in the wings. Some announcements will be coming up shortly."

Clear has called a press conference at noon today.

A check with Domainz, New Zealand's domain names registry, reveals Clear registered the name zfree.co.nz on March 30 and zfree.net.nz on April 4.

Mr Inglis would not be drawn on whether the free service would be offered to the company's estimated 39,000 Clearnet customers who pay $40 a month for unlimited access.

The likely move to a free service will be helped by i4free's success in the High Court in continuing its injunction against Telecom restricting net access.

"Competition has a breathing space," said Mr Inglis.

"We've got room to compete in the net access market."

Like i4free, zfree would benefit from interconnect revenue at Telecom's expense at the net rate of 1.5c a minute in peak times. The revenue drops to half a cent offpeak, which is cancelled out by the half cent Clear pays to Telecom for call readdressing.

Clear has its own injunction hearing against Telecom set down for May 22 in which it wants to force adherence to its number portability agreement so it can offer other internet providers the same access services, and presumably revenue-sharing deal, used by i4free.

But the big winner at present is i4free, which can now move quickly to expand its free service from 9000 active users to the full 20,000 who have signed up.

Chief executive Annette Presley said $500,000 of expenditure held up awaiting the judge's decision would be spent on more modems and bandwidth to accommodate the growth. At present, i4free has 1320 modems that will accommodate about 13,000 users on a one-to-10 modem-to-user ratio.

Clear's zfree will join three other "free" services of varying degrees: i4free, which offers unlimited free access; freenet, with about 20,000 users but which offers only 10 hours free a month and then charges $19.95 for unlimited access; and surf4nix, which started just over a week ago offering unlimited access but with a $39.95 joining fee.

Surf4nix works entirely on Telecom's network so it does not partake of any interconnect revenue. Chief executive Aaron Brett would not say how many users had signed up.

With the interconnect agreement between Clear and Telecom coming up for renegotiation at the end of this year, time is of the essence for the internet providers using Clear's network.

Some will want to enlist as many users as possible to maximise termination payments until the end of the year. That in turn puts pressure on Telecom to get the substantive i4free hearing started as soon as possible.