NineMSN ponders new revenue model

NineMSN denies speculation that it plans to charge for existing services in order to provide an alternative advertising revenue stream, but says it is considering charging for "premium services" in the future.

"We're not looking at anything in the future at this stage, and won't be charging for existing services," a spokesperson for NineMSN told ZDNet Australia.

However, NineMSN added that it would "definitely explore the possibility of adding premium services in the future," although there is nothing in the pipeline at present.

"If we were to charge it would have to be extremely beneficial to consumers and would have to look at the whole thing before considering charging," a spokesperson for NineMSN said.

The spokesperson admitted a paid service may be considered for some value added services such as personalised cards, where consumers would need to pay for downloads, development and postage.

ZDNet UK reported this week that MSN (UK) is looking to provide an alternative to advertising revenue on premium services.

Although existing facilities such as Hotmail will not be subject to charges according to the report, the spokesperson for MSN (UK) said it is actively considered charging customers for enhanced versions of existing services or for new facilities.

However, NineMSN CEO Steve Vamos flatly denied the claim, saying "it has been taken out of context - they don't exist yet and from our viewpoint we have no plans to charge for anything today."

Vamos said the company is not considering it now, however he added that if something did along that made sense, "it would be considered".

"In terms of the market, there are no plans to move from free to fee."

Despite this statement from MSN's UK office, Vamos refuted the claim that Microsoft had doubts about the long-term viability of Internet advertising, saying the company's core business model is based on an online advertising revenue model, which he is confident will sustain a profitable business.

"It doesn't make sense, the truth is that just as advertising contributes to TV and a publishing model, it's going to be a big model in the online world."

NineMSN boasts the largest reach in Australia amongst Internet services with 4.7 million unique users a month, thanks mainly to its affiliation with free email service Hotmail.

Revenue sales were up 120 percent in 2000, compared to the previous July to December half yearly figures. Vamos said the company expects to trade profitably next financial year.

"The business model is fine as it is, we don't need to change it," the company spokesperson said.

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