ISPs see profit in online ad trial

Freeserve, the UK’s leading Internet service provider (ISP), has reported excellent results for a trial online advertising and messaging service, which could see the company secure continuous on-screen advertising among its 1.5 million regular users, regardless of whether users are viewing Freeserve or third party sites.

Freeserve is analysing the results of a trial ad messaging service with US-Israeli Internet messaging company iWeb. Freeserve recruited 1,100 of its users to receive iNotes – media-rich on-screen messages – every five minutes while surfing the Net through the ISP.

The success of the scheme could prove critical to the long-term revenues of Freeserve and other low-cost ISPs. Such ISPs have so far attracted telephony revenue through building up a subscriber base.

But Freeserve and other subscription-free ISPs risk haemorrhaging critical advertising and e-commerce revenue, as users learn to move out of Freeserve areas (or the other “proprietary” areas operated directly by a user’s ISP) into other Websites.

Freeserve chief executive John Pluthero says: “The service will enable us to offer new services to both our subscribers and advertising partners that complement our free Internet access model.”

iWeb (www.iweb.com) is marketing the system to other low-cost ISPs which may be keen to secure an additional layer of advertising and e-commerce revenue.

iNotes testers were sent a message every five minutes, giving information on subjects such as sports, news, TV listings, and advertising messages. Users were free to close individual messages or opt not to receive the messages at all.

The iWeb business model suggests that ISPs may eventually be able to structure variable tariffs for users, depending on their level of acceptance of iNotes-delivered advertising.

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