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E-minister calls for lower broadband prices

Singles out BT to drive change

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The elusive E-Commerce Minister Douglas Alexander today called on the telecoms and Internet industry to cut prices and help stimulate demand for broadband.

In particular, he singled out BT to "exploit (its broadband) investment more aggressively" in a bid to get Broadband Britain on track.

He said that BT should follow the cable companies' lead and set "fair prices" for broadband.

Although Mr Alexander directed his concerns about broadband to the industry as a whole, most of his comments were aimed directly at BT signalling a marked change in tone by the Government towards BT.

Said Mr Alexander: "We need the industry to be driving prices down, and driving demand up. BT has a particular responsibility here. I welcome the commitment BT has already made to broadband. 60 per cent of all households, some 13 million homes, are now connected to a BT ADSL enabled exchange - that represents a huge investment by BT in broadband Britain.

"But BT must now exploit that investment more aggressively," he said.

He went on: "The challenge for BT is to follow the example of the cable companies in setting fair prices aimed at bringing broadband to the mass market. Not just in their retail offerings, but in wholesale too – so that the 180 resellers of BT's ADSL services can help drive the market.

"The challenge for BT is to market effectively the benefits of Broadband Britain to as wide a market as possible.

"The challenge for BT is to drive down its cost-base in the local loop, so it can charge the LLU operators more competitive prices for access to its infrastructure.

"The challenge for BT is to introduce lower-priced, lower-specification products of the sort which have helped consumers move up the broadband ladder in other countries," he said.

Recently, both BTopenworld and BT Wholesale have said they are to launch advertising campaigns to promote broadband services.

BT has always maintained that its prices for broadband are competitive. ®

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