The INTERNET Situation In Malta

History of the Internet in Malta.
What is the current situation?
What are Internet Service providers doing?
The ISP charging system and their effects.
Predictions of the Internet Services up to Jan 1998 and for the nearby future.
What other communication systems or services can be used?
What can Internet service providers do?
More services that Maltese users require.
Note to new Service Providers who want to establish in Malta.

History of the Internet in Malta.

November 1995:
Most service providers started operation, offering free trial accounts. It was the best time to surf the net for those lucky enough to have a modem.
1996:
Subscribers starting to search for the greatest bargain, while ISP starting fighting each other, offering the best deals for an account. Hundreds of subscribers started to find an ISP. Line congestions started to appear while the ISP started to upgrade their systems.
1997:
The Internet Service providers introduced new fees, most of which where exaggerated, resulting in hundreds of subscribers fleeing to other ISP, increasing dramatically the congestion on other ISP lines. Others surrendered to the idea of surfing the net and are "internetless".


What is the current situation?

Although no one can say exactly the number of Internet users there are in Malta, since new users are subscribing to the service daily, it seems that there are more or less 5000 subscribers. A researcher has given me the following figures:
470 secondary school children (Center for IT in Education)
100 secondary school teachers (Center for IT in Education)
1500 university students (Center for IT in Education & IT Students' Association )
2000 home surfers ( ITSA & Computer Society of Malta)
1500-2000 Business Users (statistical estimate)
It is estimated that something between 500 and 1000 people, used the Internet or are able to use it, but they are not subscribed because of the high fees and connectivity problems. However it is difficult to know the exact figure of the subscribers since it seems that ISP are hiding the information. There are more or less 8 service providers which offer an access to the Internet with an average of one 150 nodes each. According to a statistical research the number of modems at use at 7:00 pm is only 500. The others are left idle because they are in use by special account or due to lack of subscribers with the ISP. So at 7:00pm there might be 4000 users willing to connect, while only 400 have succeeded. It is also estimated that about 100 of these modems might not be used at all, especially the nodes of unlimited access services, but someone has logged to ensure a connection to surf later on. One should note that these are only calculations, ISP never tell us how much modems are in use and how much they really have. We calculated these from logging in a number of times, and getting the IP address assigned (for example 129.001.21.34). The last figure is the number of the first free modem found.

The phone company, the only one in the nation, does not charge calls from 6.00pm to 6.00am, other time charged at about $0.15 (US Currency) every 5 minutes. That is, after 6.00 pm, only a pulse is charged, even if one stays on line for more than five minutes. So you can easily imagine what happens: hundreds of users connecting to these few nodes at 6pm. Thus it gets almost impossible to connect between 5.30pm and 2:00am, the best time for surfing the net, since one would have returned home from work or school, and the phone call is free. But by now, most of the lines of the cheap unlimited access services, are in congestion at any time of the day and night, especially in weekends. One can also mention, that once you login, sometimes the server disconnects you immediately, thus if you are lucky to find the node free again, you will have to pay a pulse again, or worst to find the lines busy. And then, not to mention the famous windows General Protection Faults which occur regularly!.



What are Internet Service Providers doing?

Now, we have arrived to a point that the ISP's are very rarely upgrading and adding new lines, they have found a better solution to avoid congestion, and in a low competitive markets is the most appropriate: increase the fees, normally something between 50% to 200%. But they still maintain the same modem to user ratios. One might pay $25 monthly for a modem to user ratio of 1:15. In this way, for most people it is not affordable to keep connected, especially when the lines are still congested. Unlimited access is the most expensive especially when you do not want to find busy lines. If one does not want to find busy lines, he may be asked to pay from $35. There are also limited service providers, which seem to be the best solution for now. Some of them offer an amount of hours everyday and then disconnect, like in BBS's, other ask you to pay the hours in advance....and are not so cheap. While other give you some free hours every month, if you exceed the free hours you will have to pay something around $0.90 per hour. According to the statistics that I have, all the service providers except two are limited access, although they might still offer unlimited access. However, unlimited access might be the most appropriate now. One ISP does not even give free hours and are the subscribers are asked to pay even $1.20 per hour after 6pm. In other words, these subscribers would either be very rich, or else have found the way to obtain free phone calls or free surfing to use the Internet enough. Since many surfers are students, with a small stipend or some pocket money from their parents they could not afford to stay on line more than just a few hours monthly with this ISP!


The ISP charging System and their prices.

The lines of unlimited access ISPs in Malta get clogged after 6pm. Limited access ISPs charge the users per minute, or per hours, some with charges almost as high as those of the phone company to reduce this problem. Some of them, don't have on line fees between 6.00 am and 6.00pm, but the phone company makes a party with its fees during these hours! Lets give you some figures now. Assuming that some one surfs a miserable average of one hour daily ( not even the time send and read your e mail, imagine sending or getting files!). Imagine an ISP charging $1.25 per hour. Then multiply it by 30 ( days in a month)...... and you get a monthly fee of $37, only for surfing 1 hour daily. Then the subscriber should pay also a monthly subscription which varies from $10 to $50. So the bill might easily get from $47 to $87. Other unlimited access ISP are charging between $25 to $50 monthly for standard accounts an sometimes it still difficult to connect! Can any one tell me which student or minimum wage worker can pay these high fees.

One can also argue, that these conditions are restricting many potential new customers. Service providers in Malta are doing little effort to attract new customers as compared with ISP in foreign countries. Also Maltese businesses which want to advertise using the web are disadvantaged, since few Maltese customers would pay money to visit their sites. If one ask a sample of Maltese web surfers, an amount of dissatisfaction would be noticed, so new customers won't be attracted by the "Word of Mouth".


Predictions of the Internet Services up to Jan 1998 and for the nearby future.

You don't need to be Bill Gates to see the huge profits which you can make if you open an ISP now with the current fees and low competition. So, some new companies might be already preparing us a surprise for the beginning of next year. In the meantime, we can only continue to expect higher fees and more difficulty to connect. Surfing the net at reasonable price will remain only a dream.

But in the future, most probable new ISP's will appear. And the worst thing that will happen to the current ISP's is that a new investor enters the market, offering more features and better subscription rates, with more nodes. Then, the subscribers would move from their current ISP to the new one, and our old ISP's would loose their bone.
Some service providers offer discounted subscription to University and Upper Lyceum students. Within 5 years most of these students will be using accounts with a higher subscription rate. Others, would have also entered in the business as professional staff. Now, would a manager contract an ISP who tends to change its fees as frequently as the wind changes, or the ISP which he is familiar with, who offered him an unlimited service cheaply during his studies (with which he connected at anytime without the famous busy signal)? On the other hand, would a user, change from his student subscription to a standard, higher rate subscription, with his current service provider, or else change to a new one, passing through the terrible procedure of changing everything and subscribe with a new one?
Is it more feasible to spend a $5000 in node and connection upgrade and get new customers for the next years, or is it more feasible to increase the subscription to reduce customers and forget them forever.
I think that the ISP should think more seriously on customer satisfaction and retaintion if they want to survive in the future.


What other communication systems or services can be used?

As one may notice it is impossible for normal home users to surf the net before 6.00pm, except for small operations such as downloading the small mail messages and upload it. Thus, very few users call at this time, and therefore the phone company it self is not making good profits from the Internet. Some Internet surfers have suggested that the phone company should not charge the usual rate for some telephone numbers (those used to connect to ISP modems). The users could, let say, pay $10 monthly, just to access the telephone number of the ISP every month for free at any time, this would increase the profit of the phone company, and enable ISP make a better use of their resources.

But this might be too good to be true, in monopoly systems these things are difficult. The phone company always seeks to promote its new services, but it seems to give little or less importance to these things. So we need other forms of communication, more modern, as those implemented in Europe and the US. Not to say that surfers on the South of the Island were still using that primitive analog exchange causing them connectivity problems, up to a few months ago. They were paying for an inferior service the same price that people in other parts of the island were paying.

The Cable TV company can become itself an Internet Service Provider, and give a descent service to its subscribers, or else it could link to the current ISP so that its equipment could be used to connect to the Internet as the Cable companies in the UK, Canada and the USA are doing. The Melita Cable has or can have a connection with each home easily. They also have enough international links. So why doesn't it offer Internet access? It could offer free calls or very low calls to the ISP for its subscribers. But these things don't seem to be possible till the phone company will remain a MONOPOLY protected by the law, and the citizens of Malta cannot be served well by such a company. We can also say that our phone company is owned by the government. So it should serve the citizens. Now can anyone tell me why it is held by the government if it is not offering a good service to the citizens? Also, if it is a PROFIT ONLY organization, why it should be maintained as a MONOPOLY? Why is it not privatized? Can any one in the government kindly answer these question, please?


What can Internet service providers do?

We all agree that there are two type of service providers, those which charge on line fees, like America On Line in the past, and those without on line fees (unlimited access). So here are some suggestions for the two types of ISP.
The suggestions for those who charge on line fees are:
  1. Offer an amount of free hours every month, (from 50 to 60 hours), which can be accumulated if not used.
  2. No charges for those using the service between 2:00am and 6:00pm.
  3. Use reasonable charges.
In this way they could obtain even a much better use of their system resources.
The suggestion for those who do not charge on line fees are:
  1. Upgrade the modems with the number of users, or limit new entrants till they upgrade.
  2. Enable intelligent idle time detectors giving let say 20mins time before disconnecting.
  3. Leave their service free from on line charges, who really requires to use the system due to an emergency can log before 6.00pm.

More services that Maltese users require.

Most of the service providers in Malta, don't give their subscribers free web space and ftp. To have them you should pay a very high price, or they are available only to business users. I think that if the service providers give their subscribers about 256K for a web page it will be much more than enough. As you may notice, most Maltese user homepages, like this one, are hosted on foreign servers, hundreds of miles away. Personally, I don't think it would cost them too much a 2G byte disk compared to their investment!


Note to new Service Providers who want to establish in Malta.

In Malta there is a growing market for Internet service providers. Internet service providers with services similar to Demon can make a great success here.





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Created on the 15 th December 1996
Last updated on 25 th June 1997