Internet Service Providers are a modern day necessity, but that doesn't stop many of us from hating them sometimes. In many nations, broadband providers top the consumer complaint charts. If complaints aren't about delivering the promised speeds, they're about the crappy customer service, billing problems, frequent outages, and the impossibility of switching to another without being cut off from the Internet for months.

So what would it take to craft a truly "cool" ISP, one that attracted legions of adoring customers who sing its praises to everyone they meet? Fortunately, ISPs around the world are doing innovative things at prices that will make your jaw drop. Join us on our worldwide quest to find the coolest ISPs in the world, then get ready to write your own service provider a strongly worded note once you know what else is possible.

Business models

When it comes to business models, it's clear that customer complaints aren't the only area where broadband providers the world over are equal. It seems that almost all of them offer the exact same thing; Internet access and telephony, often combined with television and some generic services like e-mail and space for a website. Some ISPs can offer hundreds of different combinations by varying speeds, prices, and content packages, but it's essentially the same "triple play" offer.

In fact, making a triple play offer difficult in many different ways seems a prerequisite for becoming a telecom marketer.

It's surprising (and refreshing), then, to find a quite different business model like plus simple operated by French ISPs. French broadband providers like Free.fr, Numericable, and SFR have just one offer. It costs €30/$45, and for that you get everything:

Cable and DSL internet at 20-30Mbps (and DOCSIS3 or fiber at 100Mbps in some towns)

Free telephony to 100 nations (mostly to fixed lines; calling mobiles costs more)

HDTV with a HD-DVR

(Some ISPs like Numericable and France Telecom/Orange have offers for €20 for Internet + telephony, or Internet + TV, but the majority of customers choose a €30 pack.)

This isn’t all you get. More is included, like free access to WiFi hotspots, music jukeboxes, computer games, your own personal television channel for live TV, etc. We'll touch upon these innovations in more depth below.

The pioneer of this business model was Free.fr. Led by its maverick CEO Xavier Niel, it introduced the plus simple model in 2002 into what was then considered a lagging broadband market. Now Free is the second largest ISP in the country, it is profitable (with 4 million subscribers), and it boasts extremely low churn rates below 0.01 percent a month. One could almost say that Free’s subscribers only give up their subscription upon death or moving outside of the service area.

Of every two new subscribers in the French broadband market, one chooses Free.fr.

The philosophy of this extremely cool ISP is that competitors should be denied the possibility to compete on 1) price or 2) bandwidth. Consumers are influenced mostly by headline speeds and price, so Free makes sure that they know they get the best deal in town.

Compare this to the philosophy where consumers are best left as confused as possible, and it's difficult to know when you're getting the best deal. "One size fits all" not only saves the customer headaches, it also simplifies internal IT. Getting billing and customer relations right for hundreds if not thousands of product combinations has turned out to be too hard for most ISPs.

Furthermore, acquiring the customer is expensive, so good ISPs make sure that once subscribers sign up, they never want to leave. This is achieved by continually improving the service offered, introducing small innovations every couple of months. Not every customer will use or even like every service that is offered, but it doesn’t matter because they are free add-ons. If the services are unique and well-liked, competitors will have a tough time poaching customers. Furthermore, giving customers what they want may turn them into happy customers who promote the ISP’s service to their friends and family, further reducing acquisition costs.

A third important element of Free’s strategy is to make good use of open innovation. Most of its internal operations and many of the things it offers are based on open source software and open standards. Apart from the savings in license fees and the possibility for Free to adapt the code to do what it wants, Free also allows its customers to work with the code and build on it. There is an active community of Freenauts (yes that’s what their customers call themselves) developing and improving various bits of the services.

A fourth element, and one of the prime reasons you won’t see this offer elsewhere anytime soon, is that Free lacks marketing managers. There is only one product to manage and new services are added based on whether there is budget and whether the service is deemed cool enough. There is therefore little place in the organization for marketing managers complicating service offers and thinking up new services with fake projected take-up numbers in order to "make" the business case for the new service. Unfortunately for the rest of the world's ISPs, the fact that their marketing managers are the ones responsible for proposing new business models means that a business model that eliminates marketing managers will never get proposed.

But what would the hypothetical "coolest ISP in the world" offer using the business model described?

Network

To provide Internet service, the provider needs access to a network. It doesn’t need to own the network, though; it can be somebody else’s so long as the ISP can tweak the service parameters.

FTTH offers the highest speeds available. There is a Swedish mother with 40Gbit/s of service, but she's just lucky that her son is Peter Lothberg. The fastest commercial service available for consumers currently seems to be 1Gbps. Residents of Hong Kong and of Stockholm and Lund in Sweden can get these speeds now.

In the Netherlands, many FTTH users receive a second fiber in their home that will carry the analog and digital broadcast television signal. This way, the indoor coaxial cable wiring for television can be used and every TV can have access to the analog signal even though not all use the digital signal.

A cool ISP wouldn’t restrict itself to just one network. It would try to provide you with Internet connectivity anytime, any place, anywhere. The integration of fixed and (mobile) wireless access has proved elusive, and a full integrated offer is not on the market.

Change is coming, though. ISPs like BT, SFR, and Free.fr now offer shared WiFi access using WiFi hotspots integrated into broadband routers, even those of other customers. Subscribers can securely access the WiFi access point of millions of other customers.

SFR and BT cooperate with FON so that their customers can use it all over the world where FON is used. BT has faced some flak from customers worried that their connections would be overloaded by the visitors, but in France this seems less of an issue. It might be that because the Brits generally only have 8Mbps broadband, they fear congestion more than the French, who are used to receiving 20Mbps or more. The question is whether we will see networks agree to roaming agreements for WiFi hotspot usage between different networks.

A variant on the same theme is the Vodafone Access Gateway, which is a 3G femtocell you can connect to your home broadband connection. It will give up to four users secure access to Vodafone’s 3G network. At $265 it seems a bit expensive to fix what is essentially a hole in Vodafone’s network coverage. It can, however, be imagined that every ISP will in the near future add a 3G/4G/Wimax femtocell to its routers and farm these out to wireless networks needing some extra coverage.