The Absa Group has fleshed out its plans for its free Internet service, and has announced that it intends to release 100 000 CDs with its free Internet service offering - a number it expects to get rid of quite quickly.
The bank insists that the initiative is a "brand exercise", with UK-based Affinity Holdings and ICL picking up the infrastructure cost.
The only cost to Absa, according to Brendan O`Donnell, managing executive, Absa Group, will be a marketing cost. "Affinity is providing the software and much of the hardware," says O`Donnell, "and ICL is making a fair investment from an infrastructure cost perspective."
The revenue stream for Affinity and ICL is expected to come from transactions through Absa`s portal. "We have quite a number of initiatives in the pipeline," says O`Donnell. He clarifies the "critical mass" term that has been bandied around regarding Absa`s venture as referring to transactional critical mass, as opposed to the user base.
"The credibility on the Internet is much higher for banks than anyone else," says O`Donnell. Absa is banking on this credibility to get people to move real money through Absa`s Internet offering.
Focus group research - conducted near the end of last year - revealed that all those in the focus group with an existing Internet service provider (ISP) would change to Absa`s ISP, while most of those without an Internet account would sign up with Absa.
The South African Internet Society`s (ISOC) chairman, William Stucke, says Absa`s move is "great news", as it will get more South Africans connected - helping fulfil ISOC`s mission of "the Internet for everyone". He warns that typical cost per user per month is R65 with support. The initial planned 100 000 users will cost approximately R6 500 000 per month.
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