Atlantic Telecom swells net plans

Fast-moving phones group Atlantic Telecom continued its rapid expansion today, announcing a half billion pound acquisition and the launch of its own Internet service.

The group also said its latest package for business and residential customers would abolish call charges for Internet access and UK phone calls, replacing them with a flat rate fee.

The moves come a day after telecoms giant BT announced plans for its own mass market Internet service also offering an "always on" high speed Internet service at a flat rate of £39.99 a month.

Atlantic's package includes high speed Internet access at a flat fee of £49.99 a month, but also offers two telephone lines and free voice phone calls in the UK.

Business customers will be charged on a sliding scale depending on how many phone lines they take from the company.

The package will initially be available only in parts of Glasgow, but will also become available through Atlantic's services in Edinburgh, Aberdeen and Dundee.

Atlantic currently has around 22,500 residential phone customers and 2,000 small business customers in Scotland.

The company is poised to launch its services in Manchester and has set its sights on Newcastle and other parts of the UK.

Graham Duncan, executive chairman of Atlantic said the pace of change in the telecoms market meant traditional phone bills would eventually become a thing of the past.

"We have always believed that charging customers for the length of their phone calls or how far away they are calling will become unsustainable," he said.

In a separate move the company announced it had clinched a deal to buy First Telecom, a phone and Internet business which provides services in the UK, Germany and France, for £520 million.

First Telecom has 135,000 small business and residential customers in the UK, under its First Corporate service for business, and Easy Phone and First phone for home users.

Atlantic will pay for the business in shares.