BT’s ‘No Frills’ Service Ups Broadband Stakes
BT has launched the latest volley in the battle for broadband supremacy, by launching a “no-frills” product which it hopes will result in 500,000 additional connections by summer 2003.
The service, which will be widely available in autumn this year, will separate access to the internet from value-added services, allowing customers to have broadband internet access and telephony via a single phone line from £27 per month. Pierre Danon, chief executive of BT Retail, said: “Creating a mass-market for a product or service needs affordability plus innovation.”
The group target for connections by summer 2003 is 1 million, and broadband related services are expected to add a net increase in revenues for BT of £490m in 2004/5.
Broadband rivals Telewest, which this week announced trials of its 1Mb blueyonder service (see Telewest 1Mb Trial To Challenge BT In Broadband), has, unsurprisingly, hit back following the announcement of the plans. Chad Raube, head of internet services at Telewest Broadband, said: “The general idea behind no-frills offers is to undercut a competitor that is offering a superior service, in the hope customers will opt to save money by sacrificing quality. BT has missed the point and will still charge more for a sub-standard ADSL service than you can pay for the award-winning blueyonder broadband experience.”
Telewest today began a two-week press campaign in the Sun, Daily Mirror, Daily Star, Daily Express and Metro, in a bid to attract ITV Digital customers to its digital TV and telephone bundles. ITV Digital customers are currently being offered half-price installation to Telewest Broadband’s Essentials package (see Telewest Homes In On ITV Digital Customers).
Industry analysts Jupiter MMXI have estimated that the number of UK households with high speed internet access will treble by the end of this year (see Broadband And Digital TV Will Dominate In 2002) and BT, which provides ADSL services, already cut the price of its broadband services earlier this year in a bid to make its claim on the emerging market (see BT Openworld To Promote Broadband Uptake). However, the subsequent £10m ad campaign prompted Freeserve to go to Government regulator Oftel with complaints of anti-competitive behaviour, saying that links between BT Wholesale and BT Openworld were being exploited (see Freeserve Calls On Oftel To Investigate BT).
BT: 0207 469 2337 www.bt.com Telewest Broadband: 0800 953 5383 www.telewest.co.uk
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