Prepaid broadband is newest IP service

America's Network, Dec 1, 2003

Converting more dial-up users to broadband connectivity is the goal of a new feature recently added to Nortel's Shasta IP service delivery platform. The Shasta device, which sits at the network edge and is often used for DSL aggregation, now can support a prepaid billing model for broadband access.

"Service providers can offer an entry package for $10 to $20," says Inbar Lasser-Raab, director of product marketing for wireline data services for Nortel. "They can attract dial-up users without cannibalizing existing broadband revenues."

In a typical configuration, service providers would let customers control their service level and order more bandwidth through a portal interface. Ultimately, the goal would be to convert users to traditional monthly "all-you-can-eat" plans.

In the U.S., at least one DSL operator and one cable operator are looking closely at using the Shasta platform to deliver prepaid broadband services, Lasser-Raab says. "DSL providers need aggregation anyway, so it pays back very quickly," she says, adding that one of the cable companies looking at the offering is targeting a 25% take rate.

Nortel's idea is "clever," says RHK analyst Roz Roseboro, adding that it's a novel answer to the question "How do you get dial-up users to go to broadband using something other than speed?"

Nortel may not be the sole supplier of this offering, however, says Roseboro, who suspects it would be relatively easy for competitors Redback and Juniper to duplicate.

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