Nortel pushes usage-based Internet access model

Nortel Networks Monday launched a drive to get broadband operators worldwide to adopt a pre-paid, usage-based model for Internet access using its Shasta 5000 Broadband Service Node.

Additionally, the company also announced that Chilean cable operator VTR, a subsidiary of United GlobalCom, has launched service using the model. The goal is to give carriers several options instead of pushing them into a price war for unlimited service, which leads to thinner margins. Additionally, the usage-based model will lure less frequent users into broadband who otherwise would have stuck with dial-up service.

"It gives broadband providers a way to attract new customers without tricks said Inbar Lasser-Raab, director of product marketing for Nortel’s wireline data services group.

Using the service node along with a customizable personal content portal based on Shasta NetRIO Service Management Center, subscribers can choose their own level of bandwidth, view statistics on service usage and ultimately upgrade to full unlimited broadband. The portal also gives carriers the ability to offer upgraded services such as firewalls, VPNs and content management.

Getting service providers in Europe and South America may be easier than convincing those in the U.S. to adopt the model. VTR, for instance, began offering pre-paid service in September and provides service in a market where pre-paid wireless is the norm and broadband penetration remains relatively low.

"There’s also a market segment, particularly in other countries, of professionals that have broadband access in the office, but aren’t willing to pay for it at home," Lasser-Raab said.