BT spells out plan for broadband domination

Serious stuff

BT Retail has unveiled its plans to dominate the UK's consumer broadband market in a move that could leave a lasting mark on the ISP industry.

Earlier today the monster telco announced details of its "no frills" broadband access product which will be provided directly by BT's giant customer-facing division.

This new product - simply called "BT Broadband" - will become a central plank of BT Retail's offering and is expected to generate a net increase in revenues of £490 million by 2005.

The entry level service - which looks likely to ration usage to 1 Gb a day - will cost £27 a month and is due to be launched in the autumn following a trial in the summer.

BT will also provide a modem and micro-filters for £80, although these can be obtained elsewhere. There is also a one-off connection charge of £60.

By just providing access to the Net without any value-added services such as email or content, BT reckons this will allow punters to pick and chose which services they require.

The telco aims to get 500,000 punters signed up by summer 2003 - half the target of one million broadband connections BT has already set for the UK.

Announcing plans for its mass-market broadband service Pierre Danon, chief exec of BT Retail, said: "Today BT has gone another step to ensuring broadband is at the heart of BT. We have good products. They are at the right price. And they will be backed by a new approach to customer service, strong marketing, and increasing availability."

Industry sources claim this new offering could pose a serious threat to mass-market ISPs such as Freeserve and even BT's own ISP outfit BTopenworld.

However, Freeserve is prepared for a fight maintaining that it has yet to throw its full weight behind an all-out marketing campaign.

Furthermore, it's critical of BT's offering, claiming that it could actually cost consumers more than signing up to an ISP if they have to pay for extra services such as email and access to newsgroups.

And it warned that today’s announcement yet again "raises the spectre that BT could enjoy a further anti-competitive advantage by being able to promote and service its so-called ‘no-frills’ product at marginal incremental cost to its existing retail activities".

Freeserve has called on the regulator, Oftel, to be vigilant and to ensure that it "protects consumers from the effects of abuse of dominant market position by BT".

Cableco, Telewest, used today's announcement to ridicule BT claiming that it will "charge more for a sub-standard ADSL service" than competing cable options. ®

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