http://news.bbc.co.uk/1/hi/technology/4436327.stm



Broadband price falls to new low

People who have so far resisted high-speed net services could be tempted by broadband for under £10 a month from UK Online.

The firm has launched a service for £9.99, available to the four million homes that have access to its network.

At 512 kilobits per second, it is at the slower end of the broadband scale but the firm is hoping it will attract a new set of high-speed surfers.

It is half the price of BT's cheapest broadband offering.

Local loop

Broadband is a buyer's market at the moment as service providers rapidly reduce prices and offer free speed increases.

UK Online is also reducing the cost of its 8Mb (megabit per second) service to £29.99.

It was the first UK service provider to launch an 8Mb service and both this and its cut-price offering are possible because of local loop unbundling.

This is a process by which other operators can put their own equipment in BT's telephone exchanges, allowing them more freedom in the type and price of service they offer.

"Local loop unbundling has meant that we could offer the fastest broadband in November and now we can offer the cheapest," said Chris Stening, general manager of UK Online.

Digital divide

Other internet service providers currently dependent on BT's network are mulling opening up their own networks.

There are concerns that local loop unbundling will lead to operators cherry-picking profitable areas such as those in towns and cities, leaving more rural places with slower, more expensive broadband.

"I expect that we will see more offers like that of UK Online and the rollout of unbundled services will mirror the initial rollout of broadband," said Ian Fogg, an analyst with Jupiter Research.

"This could lead to a polarisation between urban and non-urban areas in terms of speed, price and the type of service being offered," he said.

UK Online is considering extending its network, which is spread across urban areas in the UK such as London, Birmingham and Glasgow, and has a pre-registration scheme, which allows people to request an upgrade to their local exchange.

It is also looking at launching new services, such as IP television.

Its £9.99 broadband service will have no monthly download caps but will require users to sign up to a 12-month contract.

There is also a £25 one-off set-up fee.

where i live which is only a couple of miles outside lincoln had its local exchange enabled by bt for adsl last august. we're hardly in the countryside here. quite simply the govt doesnt care about infrastructure of this country, they build roads here so why not other things?

Blair wants broadband in every home by 2008.

lol. yes, but does he want every exchange unbundled?

The problem is that the DTI is the responsible Department, and it's so ill-regarded that even the Lib Dems would scrap it, if they won the election. It's inert, unresponsive and if any former monopoly (like BT) says "Hey, we are poor, we can't afford that", the DTI says "oh okay, and aren't those consumers greedy and ungrateful *****" . It is a major problem.

DTI will always support BT in refusing to invest, and support BT in resisting EVERY single move to liberalise the telecoms market in this country. It is ingrained, cultural, and I think the Lib Dems are right - the only answer is to shut the DTI down, and ship out vital functions to other Departments.

it's only available to 4.4mil ppl in the uk cause it's only £9.99 for the ppl who are connected to an exchange that has been thru the LLU process and will create a 2 tiered pricing scheme based on whether you are lucky enough to be in an area where LLU has gone thru and uk online have their kit in there.

The thing I'm interested in is the provision of both cable and upto 24mb/s dsl lines thru nthell into the same house.. so one for usual web access the other for VoD and voip services - provided they can get their act together and provide a decent service

If I can get that I might its cheaper than NTL and also faster than the connection I currently have.

Andy, what is NTL like? I cant get them, my property is wired up, but because they use an out of date address database, they don't seem able to accept that fact. NTL Engineers who visit neighbours tell me "phone them, tell them you are wired up" but when I do I meet a) a fifteen minute delay b) insufferably rude staff who insist that THEY know where exists and where does not, and that I obviously don't know where I live..... I have to say, they are stunningly rude, almost fun, nothing like any company I deal with. So is customer care better when you are a customer? After all, I've never got further than the NTL Sales (ie "*** off you tosser") department. It's a pity, as one or two of their packages look like good value.

Andy, what is NTL like? I cant get them, my property is wired up, but because they use an out of date address database, they don't seem able to accept that fact. NTL Engineers who visit neighbours tell me "phone them, tell them you are wired up" but when I do I meet a) a fifteen minute delay b) insufferably rude staff who insist that THEY know where exists and where does not, and that I obviously don't know where I live..... I have to say, they are stunningly rude, almost fun, nothing like any company I deal with. So is customer care better when you are a customer? After all, I've never got further than the NTL Sales (ie "*** off you tosser") department. It's a pity, as one or two of their packages look like good value.

I have NTL 300k broadband and there customer service is awful and always has been although I haven't had any major problems with the internet and we're with them for phone too.

This sounds good although it wont be available to everyone. Hopefully this will start a price war between the companies and maybe a speed war too. On many times we have seen better deals but they always need a damn BT line.

It is half the price of BT's cheapest broadband offering.

No it isn't......... BT have 1MB Broadband from £17.99 a month. So BT is offering a service 2x the speed for less than 2x the price.

Mixed messages over cheap broadband offer
By Tim Richardson
Published Tuesday 12th April 2005 16:39 GMT
UK Online's headline-grabbing offer of entry-level broadband for under £10 a month has caused a stir among UK punters keen to snap up the offer of cheap broadband.

Tempted by high-speed net access for under a tenner a month, many readers who contacted El Reg were disappointed to find out that the service is only available in some areas. In fact, it is only available via 232 exchanges where EasyNet - UK Online's parent company - has installed its kit ready to provide telecoms services direct to punters.

A spokeswoman for UK Online said the company did make it clear that the £9.99 a month offer is only available to 4.4m people in the UK but would take on board any feedback. Whether or not the ISP needs to be a little less forceful with the spin and more upfront about the practicalities of its offer is of little concern. More interesting, though, are suggestions that UK Online's new prices could spark a new round of price cutting by ISPs. And this is where it gets tricky.

For yesterday's move by UK Online has effectively introduced a two-tier broadband pricing structure for DSL in the UK. If you're lucky enough to be hooked up to an exchange that has been unbundled then you can get cheap broadband - because UK Online has the choice of BT or EasyNet as its wholesale broadband provider. When unbundler EasyNet provides the wholesale service, UK Online can offer 512k broadband for £9.99 a month, while the same 512k service via BT Wholesale costs £19.99 a month.

That price difference is why so many telcos and ISPs are interested in LLU.

However, industry insiders remain unconvinced that the intervention of UK Online will spark a price war - for the immediate future at least. One reason is that the ISP is still very small. Although it declines to reveal subscriber numbers, industry sources have told us that at the end of last year UK Online only had around 4,000 punters and is hardly in a position to challenge those already firmly established in the industry.

Then there's the dosh. Sure, ISPs could cut prices but unless underlying costs are also trimmed, such a move - in the long-term at least - would just prove uneconomic. As one industry source told us: "You either have to invest in LLU or lose lots of money."

Some ISPs such as Wanadoo are investing in LLU but decline to reveal any significant detail because they don't want to give the game away ahead of a commercial launch. When Wanadoo finally does unveil an unbundled product it will face the same conundrum as to whether it also employs a two-tier pricing strategy. The view among a handful of the UK's biggest ISPs today is mixed. One told us that setting two prices depending on location could confuse punters, as UK Online has already found out, and obstruct national marketing campaigns. Another broadband provider told us that setting different prices for different areas wouldn't be a problem.

Of course, all this could be resolved at a stroke if the wholesale cost of broadband supplied by BT could be cut. But due to regulatory intervention designed to underpin investment in LLU by rivals, this can't happen. Instead, BT has engaged in "de-averaging" and won regulatory clearance to cut the cost of its wholesale broadband products in 561 exchanges in the UK that are buzzing with broadband lines.

As a result, ISPs get a rebate of up to £1.40 for every broadband line installed. Now, it just so happens that there is a clear overlap between the 561 exchanges highlighted by BT and those chosen by the industry that are ripe for LLU investment. The result, is that from 1 April, BT's wholesale broadband services are cheaper in some parts of the country than others - effectively making a two-tier wholesale pricing structure.

However, this approach was criticised by a recent parliamentary committee which was concerned at BT's proposals to vary prices that are currently applied nationally so that it can compete in areas where LLU takes off. The price cuts of around eight per cent will only be applied in areas where there is "a combination of high customer demand, high take up and lower costs". MPs warned that "BT's decision to 'de-average' wholesale prices - vary them from area to area - has created uncertainty which may jeopardise future LLU plans".

That aside, now that ISPs are getting broadband cheaper from BT in some key areas, will they be tempted to drop the prices in some regions to compete with the likes of UK Online? Dunno, is the answer at the moment. But a spokesman for BT Retail told us: "We have no plans to reduce prices in some regions but that is not to say that it wouldn't happen."

8MB broadband? :runaway:

Wow!

how about the 16 to 20mb places like japan and korea get for the price of less than our 1mb?!

we're really lagging (no pun intended) behind the rest of the world with regards net speeds and pricing.

on a side note, how long have you guys had broadband?
I've been using mine since about 2000/2001.

BT don't even offer 512MB accounts anymore, so I don't know why these articles are harping on about BT 512KB cosing £19.99.

The minimum BT account you can get is the 1MB £17.99 one.

I believe you can still get them (they aren't advertised but are still available upon request) but it is comparing bt wholesale, not bt retail - 2 diff tentacles of the great chuthulu ;)

However, I believe that ukonline connections are uncapped, can't find anything about it on their website and haven't been able to since a friend and myself contacted them about their 8mb connection last year and pointed out to them a contradiction with their acceptable use policy and their alleged generous offering of 250gb per month allowance (which makes it an effective speed of far less than 8mb when you consider things).
Also, be warned that uk online also block some ports (port 80 being one of them, so you can't run your own website...).

I tried looking through the BT Wholesale site and I couldn't find anything about 512KB accounts from them. It looks like the minimum they give you now is 1MB.

I wonder what this is going to do to 56kbdialup account prices.
BT should probably be offering 56kb dialup accounts for under £5 now.

We had the 8mb in our old house its pretty good. Down to the 2 mb service now because the Didsbury exchange is still all BT but its still decent, better than the BT broadband we had.

the thing I really don't like is the increasing use of service caps... if they can't provide the service at that speed reliably then they shouldn't be allowed to sell it or at least reduce the amount of people who can have it to the level where they can use the service at the speed they signed the contract for - I pay for 1mb and I'll get 1mb, I don't want to have a cap that reduces it's effectiveness to that of a 512kb connection. It's like selling someone a burger but only giving them half of it whilst still charging a full price, it's blatent ripping off!

ukonline have a bandwidth cap on their 8mb service, it is 600gb a month down which translates into roughly one week use at full speed.
the bt 17.99 offer has a cap, i believe it is 2gb of useage a month. 1mb will download this in less than three hours, meaning youre paying 17.99 for three hours useage a month! would you either get unlimited amounts of data slower, or small amounts of data faster.
to use the proper metaphor you can either eat six burgers today and tomorrow only, or three burgers a day for the whole month if you so choose. which is the better offer? of course consumers are stupid and look at the headline speed rate just like they look at the number of megapixels on a digicam and think bigger is better.

to give you an idea of why the cap limits piss me off, here's the stats of the theoretic download capacity using a 1Mb connection (which equals 131KByte/s, because it's rated at 1megabit you take 1024*1024/8 to get the real speed)

1min = 7,864,320 = 7.8Mb

1 hour = 471,859,200 = 471Mb

1 day = 11,324,620,800 = 11.3Gb

30 days = 339,738,624,000 = 339.7Gb

them 5 and 15gb caps don't look so fair now do they when you move up the speed scale... in the real world you can blast thru your quota within the first few days of each month, at which point you either lose your connection or you get charged even more for using more bandwidth, which is surely abuse of the customer!

hmm.. looks like they changed their cap cause when I enquired about it they were offering half that and branding it as "generous" which is what prompted my friend and I to ring them up and point out how piss poor it was!

the bt one mentions 1gb on their site for the 1mb connection - which is seriously shite!

Your average internet user isn't going to download 1GB of data in a month though.
I've been online all day and i've only downloaded 100MB of info.


You average net user who uses a computer for say 1 hour a day would never go over a 1GB cap.

ahhh sorry alpha, 1gb which is even worse and you could excede 1gb a month on dial up.

jonny, youre wrong. according to someone i know at plus.net the average user downloads 6gb a month, someone i know at ntl says 5.5gb a month. a number of isps have come out and said that their average user figure is around the 6gb level right now, i believe bulldog are one to say this.
the ntl person i know said the reason why the ntl cap is set at 3gb a month is so that the vast majority of 1mb users will be forced to upgrade to the next teir whilst their internet use isnt expected to increase drastically meaning ntl get another 8 quid a month for little extra cost. its around 6gb a month and will gradually increase over time whilst the cost of delivering the bandwidth to them drops by half every 18 months.
the other thing he said is that bandwidth useage is increasing every single month. as connections get faster, screen resolutions get higher, and bandwidth gets cheaper for actual web hosts the sites get bigger and bigger in terms of the bandwidth they have on offer - my own site is a classic example of this, check out the size of the pics on it to emporis because we designed ours around 2005 requirements rather than their 2001 requirements.
he also said that gradually useage is changing. an increasing number of people watch 300kb news streams on the bbc website which is pretty decent quality, people listen to the radio online, the bandwidth that computer games use increases, people use webcams for internet messengers, infact downloading mp3s is a pretty low bandwidth use compared to streaming video unless you download thousands a month.

moores law it appears applies to internet bandwidth just like it does everything else but the likes of bt arent doubling their actual offers every 18 months, only the speed rather than the amount of data which makes it pretty useless.

add into that os and application patches and updates, services like podcasting, rss, online console gaming and multiple machines per house connecting and you can easily increase the usage of your net connection to well beyond the shitty little caps that are imposed right now. I'm having to look for a new isp before july when my isp starts to introduce caps because I refuse to have my usage restricted - in my 4 to 5 years of having adsl I've never had a cap (and I've even used bt, but that was before the huge boom in connections) and I don't plan on starting to now. If I can't find any I plan on making a formal complaint against both my isp and the trading standards body over the unfair bandwidth restrictions placed onto the connection so that if I have to live with the cap I want the fee I pay reduced accordingly for the reduced service I then have.

So all in al its all bollox

I think AOL offers an uncaped service??

Well, I've just bought UK Online just now...I'm going broadband soon...how nice is that?

the whole isp? how'd you get the cash for that?? thought you were a skint student!! we had a millionaire in our midsts the whole time and never knew it! ;)

lol! Dammit, my identity has been revealed!

I used to have NTL 300k you can get a free upgrade to 1.5 M, but has a limit of 3 gig. this is for £17.99, but I have the triple deal, phone (plus line rental) dig TV and this broadband connection for £29.99. With the digital TV the quality of the picture is slightly less than quality from freeview (depends on your arial though) but you get a few more channels with NTL. The phone isn't free after 6pm locally, but the cost is low.. if you don't make too many phone calls, this package is a good deal. To be honest, cable is the way to go for broadband, the speed is especially fast when less people are using it.

the way forward is voip - it'll definately take off if bt introduce a "dsl only" package where you only get 999 access on the phone line and pay for only the dsl line subscription - no phone bill.. but of course that would depend on bt catching up with the likes of bulldog who already include a free phone line (but you can still make calls on it) rental in the price of their broadband.

dsl lines (be they adsl, sdsl, vdsl and version 2+ of each of them) are readily outstripping cable globally and will only really face competition from wireless solutions - later this year bt will be launching adsl2+ and will initially run at 18mb/s, but you can expect they'll charge a fortune for it... ntl are also looking at pushing adsl2+ as they are busy putting in equipment that is adsl2+ ready atm.

NTL is shite. My connection has been down for 2 days its only started working in the last few hours.