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Anticipation grows for Carphone 'free' broadband offer

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The Carphone Warehouse is expected to confirm plans to offer cut price broadband when it publishes its trading update tomorrow.

Speculation surfaced two weeks ago that the retailer-cum-telco - which is investing megabucks in local loop unbundling (LLU) - was mulling the idea of "free" or cheap broadband.

Weekend press reports have been able to add a little more detail to these earlier reports suggesting that the firm could be prepared to offer broadband for free for a couple of months and then charge just £4.99 a month after that.

Of course, this is unlikely to be a standalone price and would most likely be bundled with Carphone's TalkTalk fixed line service. Furthermore, it's not exactly clear what broadband service would be on offer for this price and what strings would be attached.

Industry insiders have warned punters not to be sucked in by the hype surrounding what Carphone might, or might not, announce. On occasions such as these they're always ready to dust off that well-worn phrase about there being "no such thing as a free lunch" and want to see the detail of any announcement before making any further comment.

Another insider said any move to offer "free" broadband was simply not sustainable. If it was, "we'd all be doing it", he said.

In recent weeks, however, both pay TV outfit Sky, which owns LLU operator EasyNet, and BT have been linked to stories about "free" broadband, prompting some industry watchers to suggest that a broadband price war could be around the corner. ®

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