Brit Broadband Costs to Fall as BT Slashes Wholesale Rates

27 February 2002

In a bid to attract more UK consumers to broadband internet services, British Telecom announced it will slash from £25 per month to £14.75 the wholesale price charged to ISPs for high-speed web access.

Effective April 1, the move should prompt a series of price-cuts for broadband offerings by internet service providers. Operators such as AOL UK and Freeserve welcomed the decision, while one ISP, Pipex, has already responded by cutting charges to below £20 per month.

Says BT Wholesale ceo Paul Reynolds: “We have now achieved the price that service providers told us they needed to get end user prices below £30.”

However, some observers point out that the fee for an engineer to install a BT consumer connection will simultaneously go up by 40% to £210.

Separately, cable operators NTL and Telewest – both of which already offer cheaper broadband services as part of a bundled telephone/cable-TV package – are expected to unveil further expansion of their high-speed web offerings.

Telewest, it is thought, will announce later this week it has 100,000 broadband subscribers. It also intends to launch a one-megabyte connection (twice the speed of its current service) in some areas at the end of the year. NTL, which has around 140,000 web customers, is expected to reveal similar plans in the next two weeks.

Data sourced from: BBC Online Business News (UK); Financial Times; additional content by WARC staff