The UK’s largest two portal sites, the Microsoft Network (MSN) & Yahoo! have both launched free ISP services as two of the country’s largest book retailers also plan to battle it out in the booming UK free ISP market .

From Monday, Yahoo! UK & Ireland will drop the penny-per-minute charges from its Yahoo! Click ISP, to be renamed Yahoo! Online. It will also offer a re-branded service in partnership with bookseller Waterstones and its music retailing sister company HMV. Meanwhile, the Microsoft Network is to announce its involvement in the free ISP to be launched later this Spring by rival book/music seller WH Smith. MSN is expected to provide a large part of WH SmithÆs portal content and some distribution.

Waterstones and WH Smith, long-time rivals in the high-street book-selling market, are already engaging in one-upmanship, with WH Smith claiming its offering will be innovative and powerful and, in a clear reference to Waterstones, not limited to selling books on the internet. WH Smith also goes up against VirginNet and the In2Home from video games retailer Electronics Boutique, which announced its free ISP with Scottish Telecom on Wednesday.

The portal providers are more low key. MSN has yet to reveal the full extent of its input into WH SmithÆs service, though the mention of the link was sufficient to push WH SmithÆs shares up 11% to 657 pence. Yahoo! Online users will have access to little more than is currently available. MSN is also working with Egg, an arm of the Prudential Banking Plc, to provide content for its online banking service.