Cash wrangle death knell for free net

By MICHAEL FOREMAN

The days of surfing the net for free appear to be numbered.

I4free will downgrade its free internet service after being told by Clear Communications on Christmas Eve that it will no longer receive interconnect revenue.

From today, any of i4free's 145,000 customers who try to access the web will be redirected to a page inviting them to join a new paid-for service at www.slingshot.co.nz, offering unlimited internet access, free home page hosting and up to seven e-mail addresses for $14.95 a month including GST.

According to i4free executive director Wayne Toddun, customers may elect to stay with the free service but will probably get busy signals and slower performance as modems and other resources are transferred to the paid service.

Industry sources suggest that rival free internet service provider freenet will announce a similar plan next week.

Mr Toddun said i4free and Clear had been working for months to replace an interconnect revenue sharing agreement that expired on December 31.

"We would continue to receive interconnect revenue in January and beyond.

"However, it seems Clear had some quiet discussions with Telecom just prior to Christmas when they agreed to put a stop to that.

"They've stuffed us, basically," Mr Toddun said.

While i4free would now approach Telecom directly for interconnection revenue, which it believes it is entitled to according to recent Government telecommunications industry reforms, such an agreement could take months.

According to Mr Toddun, i4free has already invested $2.5 million in its network and would have spent a further $5 million to continue providing a wholly free service over the next year.

Clear spokesman Ross Inglis refused to comment, saying details of negotiations between Clear and its customers were confidential.

Mr Inglis confirmed that Clear's zfree service, which stopped accepting new customers last month, would continue to provide free connections to existing users.