By Kevin Murphy
British Telecommunications Plc said it will introduce next month a low-cost tariff for internet service providers using its network which, it says, could enable ISPs to offer unmetered dialup access packages. The announcement will be seen by many as a pre-emptive strike against an increasingly hostile internet-using public, ahead of the publication of its interim financials this Thursday.
BT now seems eager to be seen as championing unmetered internet access, the Holy Grail of many UK net users. But the new system, while allowing ISPs to pass cost reductions back to consumers, is a long way from this goal, and little better than pricing offered by competitors such as AOL UK, NTL Inc and a host of other ISPs.
Under the system, BT will rent out dial ports with contention ratios of 14 to 1 to ISPs for 140 pounds ($226.80) per month, excluding VAT. Each port will have 8 hours of dialup per day included in the price, with an excess of 1 pence per minute. This means that ISPs will pay 10 pounds ($16.2) per consumer per month, with each consumer getting just over 17 hours connectivity per month.
If an ISP were to offer this to its customers at cost, this equates to an end user saving only a few pence if all dialup takes place at weekends, with the only considerable savings visible if dialup takes place during peak weekday times. So essentially the service is no better than those from AOL and NTL, which both charge users 1 pence per minute for internet calls at all times.
BT says this new cost reduction for ISPs is possible due to its own 100m pound ($162m) investment in its network over the next two years, intended to optimize it for internet use. Details of this program were not yesterday available, and are expected to be revealed next week. The company will take its new pricing scheme for approval from the regulator, Oftel, this week, and expects to introduce the tariff in mid-December.
