M-Web targets broadband and TV

Johannesburg, 12 Jun 2000

M-Web says it is time to start milking the 235 000 subscribers it reported at the end of its financial year. That base represents 42% of the total dial-up market reported in Media Africa`s recent Internet services survey.

"Our new strategy is to leverage the maximum possible value from our user base," M-Web Holdings CEO Antonie Roux told investors at the presentation of the company`s annual results last week. "We are driving commerce very hard."

He said M-Web has not experienced the access growth slowdown the services survey found.

One way of upping revenue, the company believes, is through its Siyanda satellite access service. "Adspend on the Internet is still low, but with broadband the advertising changes and there is an opportunity to grow this."

A rich-media service for satellite clients called M-Web Plus will be launched in August, Roux said, and the service will be run on a pay-as-you-go strategy with a zero entrance cost to current dial-up subscribers.

Certain services on the M-Web portal will be restricted to members.

Also to be launched later this year is a Wireless Application Protocol (WAP) portal and an interactive television service from MultiChoice for which M-Web will supply the return path and transaction engines. Roux said the companies will operate on a revenue share basis and M-Web expects to be the only Internet service provider (ISP) involved in the project, although the relationship is non-exclusive.

Eddie van Rensburg, GM of M-Web Business Solutions, said the merchant base the company is gathering is also expected to make a larger contribution to revenue this year. "A merchant is worth about R1 000 when he joins, but the value increases as the sales volume increases." He added that M-Web is opening an average of 25 virtual storefronts per month.

Free Internet access is one thing M-Web is not considering, despite hiring the consultants that helped devise the Dixons free ISP strategy. "A FreeServe model cannot work, end of story," Roux said, adding that fixed-line competition for Telkom will change the scenario.

"Sticky" applications have been found to keep residential customers occupied, and the company has plans to extend its repertoire. "We are moving the emphasis from [using the Internet for] communication and research to making people`s lives easier," Roux noted.