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Free Internet Access Is Profitable In Egypt
prostoalex writes "With the demise of free Internet access providers, it's interesting to see this model working in Egypt, where the state-owned telecom allows people to dial-up for free as long as they pay the regular phone access fees. Associated Press quotes the phone line charges being 25 cents per hour. The ISPs that promote free Internet access from Telecom Egypt are then given their share of the profit."
more bloody pyramid schemes
Sounds like a pretty reasonable plan, all things considered. Too bad the US dosen't have anything like that.
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Associated Press quotes the phone line charges being 25 cents per hour
Need I say more?
From what I hear, this internet access is absolutely unreliable. I wouldn't be too glad that it's profeitable since it's pretty easy to make poor service that you basically force everyone to use profeitable.
__________________________________________
Take comfort in your ignorance.
Grandmaster Plague
Good idea, the phone company makes more money due to more phone usage.
They just pay out a small portion for this, it is like quantity based discounts that other companys use.
Ig, or Internet Gratis, is one of the biggest ISPs in Brazil, and it's free. It runs on the advertisements it displays.
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How much is that in terms of the average Egyptian's income?
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
At $ 0.25 per hour, I would be paying about $3/day ~ $90/month. Right now I pay about $70/month for unlimited usage.
.... it's because we like to pay for unlimited usage of things whether it be the internet, phones or sex.
Americans hate pay per use pricing schemes. Notice how all of the cell phone companies have moved to flat rates for a large number of minutes
Okay, well we've worked out the first two at least.
the state-owned telecom If I staretd a free ISP and the gov't subsidized me, yeah I'd be making a profit as well.
I would be willing to bet that is quite a bit more than the average Egyptian can afford. I dunno, I might be wrong. Still, for rudimentary text-only web, email, and Usenet usage, say 1 hour/day it would be quite adequate.
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The U.S. has free internet access too. All you have to do is live in a college dorm at most large colleges.
Ummm how is .25 per hour free???? I'm sure if you call up the local bells they would love to implement a similar "free" system!
The same strategy is being used in India, and its quite successful. Its not exactly free, as you pay for phone access plus more, but there's no account setup, username/password and so on. Its extremely convenient, you get charged for what you use with your phone bill.
This is the dominant mode of internet access. All (2 or 3) major ISP's allow free modem access, while you pay the cost of the telephone call (about 70 cents an hour evenings and weekends, 4 times that at other times)
It is not bad, (no contract) but leaves a bit to be desired, and there is NO affordable broadband access
m
When I lived in the UK (mid to late 90s), there were plenty of free ISPs (including the national carrier). All worked on the same premise - the ISP get's a cut of the telephone call charge. Note that back in the old dart, local calls are timed, otherwise this would not work.
So basically in Egypt, the majority of people, who do not have computers, pay for the internet through normal phone usage, assuming they have phones. This must be true if there is no difference in the phone rate whether you're making a local call or using the internet. Why should people not using the internet provide cheap access for the minority who do? Also, as more people get computers in Egypt, won't the cost of phone service go up as more bandwidth is tied up. Incidentally, we do this in the US. We all pay a surcharge on our phone bills so schools can get cheap T1 access.
Vote for Pedro
So basically you are paying for internet access, just in a different form.
Move along folks nothing to see here.
Kudos to the egyptians, now they only need to keep their telecom company state-owned; nasty things happen when you privatize those companies without adequate governmental regulation; witness what happened to the telecom companies in Mexico, Chile and perhaps other countries in south/latin america. They turned, overnight, into greedy monopolies which can't be stopped (here in Mexico, Telmex is running their competition, even the giants like Worldcom-backed Avantel and AT&T, into the ground via dumping and other monopolic practices); and the quality of service hasn't really improved. i'll stop ranting now :)
Wow, if only we had a single monopoly that controlled all communications, why then we could have a free ISP (well free in the part that you are still paying for it with your phone bill.) Gosh, they have almost 900,000 of 63 million people online. That is over a full percent! Instead, we have all these greedy little ISPs running around charging people for service. Can any of you remember how great it was when ATT was the only company, and we didn't have all this annoying fax, cellular, nickel a minute LD stuff? It was like paradise on earth. I think we should all get off this open source wagon, and jump back on the one company ruling the world wagon...like Bill Gates would like. For that matter, I am sure MS would be more than happy to give the US free internet access, if we gave them the monopoly of all software and internet publishing as the fee. Unfortunately, when you don't have one company controlling the entire market, it is really hard to rob Peter to pay Paul.
The real fact of the matter is that the service isn't free.. It's just being paid for through your phone bill.
Because I get my ADSL from my phone company (Telus) I can also pay for it through my phone bill... Does this mean that I'm getting my ADSL for free too?
(at $40CAN/month ($25US) for 1.5megabit down and 500kbit up, some people might claim that I really do)
Free Software: Like love, it grows best when given away.
This will work in the U.S.... ... when we all agree to pay a per-minute charge for local phone calls.
Wait? What's that you say? We all like paying a flat rate for unlimited local calling?
Hmm.. I suppose this means this model will never work in the U.S. after all.
One of the biggest enablers of commerce in the US is that we can just pick up the phone and yak without thinking about the cost. Letting your fingers do the walking can be quite expensive in many countries. While low cost internet access is a nice thing, low cost everyday phone service is far more important. I'll take free, unlimited local calling any day, then gladly pay $20/month for internet access if need be.
...free local calling plus paying $20/mo for internet access still comes out cheaper for any serious usage. So the Egyptians are still getting screwed (then again, so is much of Europe).
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
This is a state-owned monopoly telephone system that is very profitable. In essence, the state is providing "free" internet access by over-charging everyone else for telephone service.
This is really a strategy by the State of Egypt to keep itself firmly in control of the Internet in the country. The deals with local ISP's to split the money are just to ensure the ISP's loyalty. They are being bought by the state.
When netoworks came to Egypt land,
let us gratis surf,
They raked in cash fist under hand,
let us gratis surf,
Refrain:
Go down, users,
way down in Egypt's land;
tell Tel'com Egypt
let us gratis surf!
In Portugal it's the same. Free access, except you pay the huge cost of the phone calls to our evil monopolist phone company which then pays a percentage of the cost to the ISPs. The access is quite good, for a dial up, but we all know that dial up is a thing of the past so everyone's moving to cable and ADSL's monthly fee which is far cheaper for most users than our extorsionist monopoly's inflated phone prices. I had already mentioned all of this a long time ago in a past comment...
Here in Ireland, all dialup Internet access is this type of "free", in which you are billed for the phone time online.
For the phone company and ISPs, this "Free" Internet Access Is Profitable In Ireland, also.
Few people like it, and would rush to support the other side of the fence, in which there is a flat rate of about $40 euro a month for dialup, and that is it (following the typical unmetered approach available in most of North America). An option of pay-for-phonecall is good, but when the phone company colludes with ISPs to make it the only option available, it cripples the country's online growth.
The largest ISP in Ireland is IrelandOnline(IOL).
The nexus of protest against this forced free-but-pay-for-the-phonecall scam is logically located at IrelandOffline.org
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In Poland, we've had "free" dial-up like this for about five years now.
But I wouldn't call it free in the presence of people that still are in this dial-up hell if I were you.
-jfedor
Umm where does that 7 come from? .25 dollars/per hour * 24 hours/1 day* 30 days/month = 180 dollars/month. Gotta love dimensional analysis:)
So what do you think the chances are that the AC who posted this ingenious formula is actually the brilliant mathemetician that came up with Slashdot math? ;)
;)
24 hours * 7 days in a week * 30 days in a month = 1 month?
Riiiight.
$0.25/hour would actually total about $180/month for 24/7 access. That's still insanely expensive for dial-up (these days), however small the chances of someone staying connected constantly actually are.
--
[McP]KAAOS
It goes from God, to Jerry, to me.
How is this free?
They still have to pay 25 cents an hour, and that is a lot considering how much average Egyptian makes.. So no its not free internet... Its like AOL merging with BellSouth or whatever Bell there is in your area and saying we offer free internet access as long as u pay Bell $$$ an hour..
We have such schemes in the UK too, infact they were once so popular that the telecom company was complaining about the overload to their exchanged at peak times. Nowadays while many users pay a flat rate per month, many light users still use the per-minute systems.
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Slashdot == idiots
Free internet access that costs 25 cents a minute? Is that free as in "we're uncommonly dull" free?
It's not just Egypt, it's any place with no flat local phone rates, i.e. basically everywhere except North America . Example: it's the standard in Switzerland.
(See also Estonia, Brazil, Portugal, India, Ireland, Argentina, Guatemala, England, Poland, ...)
Slashdot editors need to get out more.
Timeo idiotikOS et dona ferentes
yak without thinking about the cost
>>>>>>>>>
Note to self: After ascending to high-dictatorship of the universe, raise phone rates. It will decrease the general stupidity of the population.
A deep unwavering belief is a sure sign you're missing something...
$0.25*24*7*30=$1260.00...
Wouldn't it be $0.25*24*30=$180.00 per month? Still alot though. Cable modem is still much cheaper.
If you decrease the general stupidity of the population, they are going to fight against the high-dictatorship of the universe...
guru in training
Free Internet can work anywhere that people are already paying per-minute for local phone calls. It doesn't work in the US where unlimited local calls are free.
I think it would be more appropriate to call it "Free Internet Fails in USA, works everywhere else"
Anyone know why Egypt is getting singled out?
Slashdot gets worse every day... Pipedot: News for nerds, without the corporate slant
Argentina has experienced the first wave of free ISPs that displayed ads to support themselves and they failed like almost everywhere else. Nowadays a new wave of free ISPs has arrived, completely free and adless. They support themselves by being tied somehow to other ISPs/Telecoms and by offering special content to their users (Where they display ads). ISPs here have special "reduced fee" telephone numbers which save you quite a lot of money if you stay connected more than 15 minutes. Free ISPs do not have this kind of services. So, they support themselves in part from the money that doesn't go to the "reduced fee".
--- I w00t, therefore I'm l33t.
Trust me, you pay for access at college. And if you use "too much" bandwidth, you get your port shut off. Of course, most of the time they do not define "too much," and also block many websites (i.e. any file sharing website).
What is interesting is that this same type dial-up access is also used in Singapore. There is free dial-up but you have to pay for phone usage. I am not sure if it is profitable, but it is still being offered. All incoming and outgoing phone calls are charged in Singapore depending on the time of day.
A computer is a valuable tool, so use it and stop whining.
Not all places in the US are that lucky to have flat rate unlimited calling. I can think of 8 million poor saps with SBC/Ameritech in the Chicago area who dont....
nasty things happen when you privatize those companies without adequate governmental regulation....[in Latin America] They turned, overnight, into greedy monopolies which can't be stopped"
Isn't that what they were before privitization???? The problem isn't the idea of privitization itself, it is that there is too little of it. Monopolies exist because of government regulation that keeps the small fish out. We need to privitize with even less government regulation.
"Telmex is running their competition, even the giants like Worldcom-backed Avantel and AT&T, into the ground via dumping"
Dump on! This means the customers end up paying less.
My local phone service provider wanted to get into the Cleveland, OH. market badly to offset Ameritech they made an offer I could not refuse:
unlimited local phone service.
10 cents local toll and long distance.
call waiting included.
caller ID included.
800 number (if I wanted it).
unlimited dial-up internet.
At the time I got this, it was $25.99 per month. However, about 6 months ago, that price rose to $39.99 per month. But, I still pay $25.99 per month because the service said they would honor that deal as long as I do not cancel (according to them, I was a "good customer"). Even at $39.99, it is still a bargin!
Even if I did not have this deal, I prefer an unlimited internet package so I do not need to worry about running up the internet bill. Screw the per hour toll!
Coderz 4 Life
Trust me, you pay for access at college.
Trust me, you pay for access in Egypt as well.
There is free dial-up but you have to pay for phone usage.
I don't get it. If you have to pay, then it's not free.
The Egyptian Pound (LE) had been pegged at almost exactly 1/3 of a dollar for a long long time, but I look now and see that it's shot up to $1 = 4.65LE. Thus 25 = 1.15LE (approx). It's been about 10 years since I lived there... what does an Egyptian Pound buy you these days? Anyone on the ground in Cairo care to comment?
Looking for current data on income, the world bank cites a figure of $1,490 for Gross National Income per capita in 2000. So, that's about 6700LE. Africare says it's more like $3,420 (=15,903LE), but that's "real GDP per capita."
Getting useful numbers is tricky, especially when you're talking about a country like Egypt that has a vast off-the-books economy going on.
It's 10 pt/6 minutes, or 1 LE/hour, which is $0.22 at today's exchange rate. If you're connecting between midnight and 8 am, it's only 75 pt/hour, or $0.16!
So, what does a dollar buy you these days? With 07777777, it gets you over 4.5 hours of internet access. Thanks, GegaNet!
My question is what kind of throughput can you get over the average Egyptian phone line? I somehow doubt that it's a solid 56K from most locations.
Ok,
So you with my 9.95 netzero premium unlimited dial up with my unlimited local for $15...I would only get around 100 minutes in Egypt?
Wow! When can I move? That's a fantastic deal!
Next topic please...
Same system is common here in Finland - several ISPs started 'FREE INTERNET ACCESS' plans few years back. You just paid the calls, which are charged by the minute. Naturally they profited by getting the call termination charges - basically a cut from the phonecompany's call charges.
After few years, local regulator said 'Waitaminute, you are advertising something as 'FREE' when it clearly costs money'.
So nowdays they have to advertise these things as 'Internet with no monthly fee!'. Same thing, but they can't call 'em FREE anymore. Which in my opinion is much better.
Of course every real user has migrated to cable or DSL. You can already pretty much get DSL everywhere that could be even marginally considered 'urban area'. Then again we pay thru the nose for it. I'm paying about 150 euros a month for 2Mbit down, 512Kbit up. Cheapest one (512/256) is about 50 euros a month.
1. set up free internet
2. negotiate with phone company
3. ????????
4. profit!
"PC Load Letter? What the $@#% does that mean?!"
"Patriotism is your conviction that this country is superior to all other countries because you were born in it." -- GBS
I cant see why and how this has made it onto ./
and why yahoo run it as a story in the first place.
It is just a standard dial up service, where the isp gets the money of the telecom company.
I though this was the most common type of dial up in the worl, and has been for years.
This is why Freeserve etc even exist.
My other Sig is very funny.
How many people are online 24/7 ? I tend to go to sleep some of the night and to work most of the day. I am a fairly heavy user during the time I do have have but there are a lot of people that have real lives. So when you accept that the majority of users (not those here) are online for less than an hour a day the equation changes.
I love stacking my barbecues in the shed at the end of summer - you can't beat a bit of grill on grill action.
The problem is that Ig's main business has long shifted from the free internet model to other services. They take most of their profit from contents, broadband, free email and other pay services. The fact that they started as a free internet service provider doesn't mean that their sucess depends on this business model.
How do you get free local calling? Typically there is atleast a minimum fee for service. if you're paying $10-$15 per month for service, but not paying for calls...well, sorry to burst your bubble, but you're paying for those calls. And in the months that you don't make many calls, you're over paying. I pay for unlimited local service aswell, but if you actually did the math on those numbers, I think you'd find that on a yearly average you always overpay for your unlimited local phone service
There is a huge disparity in wages in Egypt. A schoolteacher, for example, makes about LE 200 ($43)a month. This is also about what someone working for the government makes. Someone in the private sector with a good education can make about LE 500 ($109) a month, or maybe LE 1000 ($218) in an average kind of job. This makes computers out of the price range of most of the population (without even thinking about Internet access). An hour a day on the Internet would take a fairly large chunk of money from most family's income. Internet in Egypt is something only a small percentage of the population can afford. The government also has some Internet cafes, which it lets people use for LE 1 (22 cents)an hour, and there are also commercial cafes, which charge about $1.50 an hour. This makes sense for most Egyptians, as it means they don't have to buy a computer. Computers in Egypt cost about the same as they do in the US or Europe, which is beyond the means of many. In reality, "free" Internet is pretty expensive in Egypt for the average user. Although, that hasn't stopped families stretching their budgets to buy the latest and greatest mobile phones. There are about 3 million mobile phone users, compared with only 900,000 Internet users.