AOL UK's Revolution

As unmetered ISPs close in Britain, AOL UK enters the unmetered-access fray, and also announces new wireless services.

by John Lewell of internetnews.com [November 8, 2000]

AOL UK announced Wednesday that it is extending its flat-rate Internet access plan to all consumers, including newcomers who have not previously been members of its service.

This is a change in policy. In the past, only AOL UK subscribers were eligible for the flat-rate service.

Starting immediately, anyone in the U.K. can now obtain unmetered access for a standard monthly fee of £14.99 (approx. US $21). The fee includes all subscription and Internet telephone costs plus unlimited freephone member support—in stark contrast to the so-called "free" Internet services offered by hundreds of other ISPs.

"Today marks an historic turning point for the interactive medium in this country, as we at AOL UK are fulfilling our pledge to 'Stop the Clock' for UK consumers," said AOL UK Managing Director Karen Thomson.

Can AOL succeed where others failed?
AOL UK appears confident that it can cope with demand, despite the fact that many other ISPs have offered unmetered access—only to withdraw the service from heavy users, or, in some cases, from all users.

However, Karen Thomson insisted that the service will be sustainable. She spoke of AOL UK being ready to launch the next phase of growth which is to "make AOL FLAT RATE available to every household in the country." AOL UK also announced Wednesday that it has surpassed one million members and hopes to attract even more through its unmetered offering and the various marketing promotions that will support it.

Among promotions already lined up is a one-month trial of the service at no cost whatsoever, with up to 50 hours of Internet usage included. The company will also distribute CDs in 240 U.K. ASDA supermarkets from mid-November.

Mobile and SMS services
Finally, AOL UK also announced new mobile and SMS mobile services as part of its "AOL Anywhere" strategy. AOL Mobile will provide users with one-click access to e-mail, news, sport, weather, entertainment and stock market information, together with many e-commerce opportunities.

"Mobile services are an important part of our efforts to bring the next one million members online by building a medium that is at the center of consumers' daily lives—anywhere, anytime, and any way they choose," said Thomson.

Making possible the breakthrough in Internet pricing in the U.K. is Flat Rate Internet Access Call Origination (FRIACO), a wholesale pricing methodology devised by economists commissioned by AOL UK in early 1999. FRIACO removes ISPs' exposure to unlimited costs by enabling them to purchase bulk capacity from BT on an unmetered basis.

Other ISPs besides AOL UK will be able to use FRIACO.

—End