Spain Approves Flat Rate Net Access

After months of lobbying by Internet user groups, a Spanish
government commission approved a flat Internet access rate on Friday.

With the use of ADSL technology, the phone company will be able to
distinguish data from voice calls–and users will be able to surf the Net
at higher data transmission rates for a monthly phone charge of about $30.

The cloud to the silver lining is that users must pay a $100 registration
fee, plus $300 for an ADSL-compatible modem. Currently Telefonica, the recently privatized state monopoly, is the only
company able to offer this technology.

“The basic rate is twenty times less what it cost to use the Internet back
in 1995, when [the now defunct] Infovía was installed,” said Spain’s Ministry of Public Works and the Economy in a statement. “In 1995 the price was
more than 100,000 pesetas ($667) and now with the implantation of the flat
rate, it is being reduced to 5,000 pesetas ($33).”

While Spanish business users might be smiling, individual Netizens may have
a tough time getting excited. According the Association of Spanish Internet
Users (AUI), the average Spanish user currently pays the phone
company roughly 3,000 pesetas ($20) a month for Net usage.

This is separate from charges to set up an Internet account with one of
Spain’s more than 600 ISPs.

“This will mainly benefit companies,” AUI president Miguel Perez said to
Noticias Intercom. “Nonetheless, we consider the starting price to be far
from the aspirations Spanish home users have been defending.”

At an Internet users conference last month, development minister Rafael
Arias-Salgado stated that $30 still seemed high for a flat rate fee, but
that it was a step in the right direction.

Two additional monthly flat rate plans, exclusively for business users,
will be available for $60 and $125.

At present, fewer than 30 percent of Spanish households can take advantage
of ADSL technology–and thus the flat rate. The Ministry of Public Works
and the Economy will oversee Telefonica’s wiring of the remaining 70
percent in 2000 and 2001. Spanish regulations prohibit Telefonica from
entering the nascent Internet cable market.

Though Spain’s telecommunications sector has been liberalized, the
government still has some say over competitive practices and rate changes.
Flat rate activist groups have called three separate “Internet
strikes” in the past year, eventually forcing the government to the
bargaining table.