AOL Raises The Stakes In Broadband Price War
AOL has cut the cost of its broadband package for home users to below the £20 mark, in a move that further fuels the price war between internet providers vying for business at the low-cost end of the market.
Both BT and Telewest have slashed prices in recent months in efforts to tempt custom away from dial-up services and onto their high-speed networks. AOL’s entry into the no-frills internet market is coupled with ambitious plans to provide video-on-demand and internet telephony, a move which mirrors BT’s recent decision to launch several media-rich packages to boost its product line (see BT Drives Broadband With New Rich Media Launch).
It is understood that AOL is planning to launch a system to deliver high-quality television and film content to PC screens via the internet connection. It is possible that the content could be sourced from AOL’s sister Time Warner companies and it is rumoured that the ISP is in talks with a range of broadcasters to finalise contracts with content providers.
AOL is also reported to be developing a Voice-over IP service for launch within the year, offering customers cheap call rates to landlines and mobile phones using their internet connection.
Commenting on the company’s decision to enter the cut-price high-speed internet market, Karen Thomson, chief executive of AOL UK, said: “Our new broadband portfolio offers a range of speeds to suit individual needs without any risk of surcharges or capacity limits, providing much needed clarity to the consumer in a highly confusing market.”
One of AOL’s major selling points is its unrestricted approach to broadband access. While many companies impose limits on the amount of data a customer can transfer, AOL is reluctant to do so. Thompson believes that few users understand the limits which further complicate the market for consumers. She said: “AOL has always delivered flat-rate services wherever possible. Our research shows that very few consumers have any idea or interest in what a one or two Gigabyte capacity actually means in terms of usage.”
Earlier this month it was revealed that Britain’s high levels of broadband availability will secure it the top spot in the league of broadband-enabled G7 nations by the end of the year. BT has also announced trials of new technology to extend the reach of its existing broadband network, if successful they could allow access to an extra one million users at the flick of a switch (see BT To Boost Broadband Up-Take With Long Distance Trial).
AOL: 01268 530919 www.aol.co.uk
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