PPPoE vs Hotspot: Choosing the Right Billing Mode for Your ISP

Mikrotik supports two very different ways to bill and control customer internet access: PPPoE and Hotspot mode. They solve different problems, and picking the wrong one for your business model creates friction for both you and your customers.

Hotspot mode: built for walk-up, pay-as-you-go customers

Hotspot mode uses a captive portal — the customer connects to open Wi-Fi, gets redirected to a login/payment page, and is granted access after paying or entering a voucher code. There's no persistent username/password relationship the way there is with a home internet subscription. This is the natural fit for cafes, hotels, events, campuses, and public hotspots where most customers are one-off or occasional, buying a day or a few hours at a time.

PPPoE mode: built for fixed, recurring subscribers

PPPoE mode issues each subscriber a persistent username and password tied to a physical connection — the model used by fixed wireless and fiber ISPs billing customers on monthly or weekly renewal cycles rather than one-off sessions. Session data (bytes in/out) is tracked per PPPoE username directly from the router's active-connection table, which is what lets a billing platform enforce data caps or trigger renewal reminders without customers re-authenticating every visit.

Data caps and throttling apply differently in each mode

In both modes, a well-built billing platform should support two ways of handling a subscriber who hits their data cap: cutting them off entirely, or throttling their speed down to a lower profile rather than a hard disconnect. Throttling tends to produce a better customer experience for recurring PPPoE subscribers — a business owner mid-task doesn't want to be disconnected outright — while hotspot customers on short paid sessions are usually fine with a hard cutoff once their voucher time or data is exhausted.

Which one should you run?

• Cafe, hotel, event venue, or public space with mostly one-off visitors → Hotspot mode
• Fixed wireless or fiber ISP with recurring monthly/weekly subscribers → PPPoE mode
• Running both a public hotspot and fixed subscriber lines from the same router → both modes can coexist on one Mikrotik device, billed separately

Many ISPs in Kenya eventually run both — a hotspot for walk-in day-pass customers alongside PPPoE for their core recurring subscriber base — as long as the billing platform underneath can track and bill both from a single dashboard.