BT trims broadband costs

Criticisms over price prompt telco to act

BT last week cut the cost of its ADSL broadband service following sustained criticism that its prices were a barrier to uptake.

Rental charges for the IPStream 500 service will be reduced by £5 from 1 September to £30 a month. Trials of a user-installed ADSL product are also planned in an effort to simplify the connection process which currently requires an engineer visit.

Paul Reynolds, head of BT's broadband arm, BT Wholesale, said: "We are eager to kick-start the market for broadband services."

Telecoms carriers including BT have been criticised for the high cost of broadband links and the slow development of the infrastructure required to connect to end users. This has hampered the growth of bandwidth-intensive interactive services such as online collaborative design and manufacturing, as well as consumer services.

"When the infrastructure is there, the services will follow," said Mark Smith, deputy director general of the Communication Managers Association.

Andy Anson, head of strategy at Channel 4, said: "Right now we are frustrated beyond belief by the infrastructure." But he denied reports that the TV station had cut its plans for broadband broadcasting.

Anson said that Channel 4 had estimated a potential audience of one million by now, but that the true figure was 200,000 at most. He added that shortcomings in the UK's infrastructure meant that content providers were doing R&D rather than launching services, positioning themselves "for when broadband becomes a meaningful platform".

Bob Jones, managing director of Internet server appliance firm Equiinet, said: "It never seems to get through to BT that the poor take-up of DSL services is because of the woeful lack of availability rather than price."

Bloor Research analyst Graham Fisher said broadband provision in the UK has reached an impasse, with content and infrastructure providers looking to one another to change. "There is something of a Mexican stand-off," he said.

In April, the government set up the Broadband Stakeholders Group of industry and user groups to examine broadband adoption. It is due to report in September.