Tesco offers free Net access

Tesco is to offer its ten million Clubcard holders free Internet access services.

The supermarket chain used to charge £8.99 per month for Internet access, but now it is offering TescoNet for free.

Since high-street electrical giant, Dixons launched its free ISP (Internet service provider), Freeserve last September, other companies have followed suit. Before Christmas, Toys R Us announced free Net access and Silion.com has exclusively revealed that UK tabloids, the Mirror and the Sun, are planning similar services.

Freeserve today announced its one millionth account holder, a figure that puts it well ahead of former market leaders, America Online and Demon Internet.

A spokeswoman for Tesco said: "We see the free service as one of the benefits of being a Clubcard holder."

Tesco at the moment counts ten million households that have a Clubcard and 14 million individual accounts. "Our demographic breakdown is exactly the same as the UK population," the spokeswoman added. "If we can match the wider rates of Internet usage, we'll be happy."

Even if just one in ten Clubcard holders sign up to TescoNet, the service will be vying for market supremacy with Freeserve.

Tesco is trying to drive consumers to its Web site, where it is hoping to sell more goods. Companies offering free ISP services also benefit by increasing their online exposure - and sometimes selling advertising space to other vendors - and through kick-backs from telcos that carry increased amount of dial-up traffic.

Per minute technical support charges - which have been widely criticised for being too high - are generally thought to just cover costs. TescoNet helpline calls cost 50p per minute, half Freeserve's charges.