Broadband access providers slash subscription fees

There was a flurry of price cuts for broadband internet access yesterday after BT's decision to cut its wholesale prices for fast internet connections.

BT Openworld said its price for domestic consumers would fall from £39.99 a month to £29 from 1 April. BT is also waiving the £65 connection fee for its self-installed Plug-and-Go service for customers who sign up before 31 May. But for customers who want their connection installed by an engineer the price is going up to £210. There is an additional £85 equipment charge in both cases.

BT's move follows a similar announcement from Freeserve, which said late on Tuesday that its new broadband price would be £29 a month. However, it has not detailed the cost of its connection or equipment charges.

Both deals are beaten by the offer from Pipex, which is introducing a price of £19.95, excluding VAT (£23.44 inclusive). Pipex is also waiving its £50 connection charge at the moment, though the equipment, including the modem, is priced at £99 (£116.32 inc VAT)

Pipex says it already has 6,000 broadband customers, more than AOL and Freeserve put together. It claims to have signed up 500 new customers on Tuesday with a similar number yesterday.

Thus, the Scottish telecoms company, said it was reviewing prices for its Demon Internet business.

AOL, the UK's largest internet service provider, has also not yet cut its broadband prices, which still stand at £44.99. However, it said the success of broadband internet access in Britain would depend not just on price but on compelling content such as music and video.

BT said it would be announcing new advertising and marketing campaigns in the coming weeks as well as new interactive services for businesses and consumers. Alison Ritchie, the chief executive of BT Openworld, said the service had already launched the UK's first music subscription channel and the UK's biggest games subscription channel.

BT announced on Tuesday that it was cutting the price it charges internet service providers for a broadband line to £14.75 a month, down from £25.