BT Broadband not sexy enough

Analysts have cast doubt over BT's latest assault on the UK's broadband market and its planned introduction of a "no frills" service.

It seems the pricing of the access-only service - just £3 cheaper than full ISP services on offer from the likes of BTopenworld and Freeserve - might not be enough to sway punters to opt for the stripped down BT Broadband service.

According to research from J P Morgan: "In our view, the discounted price and content 'landing page' do not compensate for the lack of bundled content and services, notably email and web space."

And the chances of BT dropping the price of BT Broadband still further (a move that might make it more attractive) seem slim since J P Morgan agrees that BT's margin on the service is tight.

It also maintains that existing Net users who've built up loyalties with ISPs will be reluctant to move to this new service despite BT Retail's undeniable advantage of having access to some 21 million customers.

And while some industry sources claim consumer ISPs such as Freeserve are most at risk following yesterday's announcement J P Morgan believes that Freeserve will gain almost one in five of all ADSL connections.

It concludes that the threat to Freeserve's business from BT's new product "has been overdone". ®

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