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Dixons steps up battle with Tesco on the Net

THE INTERNET battle between Britain's high street retailers took another twist yesterday when Dixons announced plans to cut the helpline charges on its Freeserve service and introduce a financial services channel on its site.

The move comes just days after Tesco unveiled plans to offer free Internet access to the 10 million members of its ClubCard loyalty scheme.

Dixons is halving the price of calls to Freeserve's telephone support line from pounds 1 to 50p per minute. It claimed this was to celebrate Freeserve passing the million customer mark.

But analysts said the move was in response to Tesco's decision to price calls to its helpline at 50p.

Separately, it is launching a finance channel on Freeserve that will ultimately provide a range of services such as on-line banking and on- line share dealing.

"We expect it to be the best financial services channel in the country and we are in talks with a number of possible partners about adding other elements to it," said Mark Danby, head of Dixons' Freeserve division.

The group has signed an agreement with the US group MicroCap Financial Services (MFSI) to add the group's financial information to the Freeserve site.

From March Freeserve users will be able to check share and unit trust prices and look up company backgrounds and expert analysis.

Although in the US MFSI specialises in information on small, fast-growing companies, the UK site is expected to offer information on all FTSE 350 stocks.

Dixons has admitted that the barriers to entry in the free Internet access market are low, and sceptics say the market could eventually be confused, with hundreds of different players.

Tesco's move could signal a wave of copycat launches, although Dixons said its technology-literate customer base and store portfolio give it a built-in advantage.