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September 19, 1995

TWO CABLE COMPANIES TO CONSIDER STOPPING FREE INTERNET ACCESS

By CBR Staff Writer

Two UK local cable television companies are considering withdrawal of their free, off-peak phone calls to Internet service providers. The Draconian measures, details of which have not been revealed by the two, are a response to the burgeoning of Net surfers among their customers. Both Nynex CableComms Plc and Diamond Cable Plc have been offering free off-peak calls in an effort to cut into British Telecommunications Plc’s domination of the voice market. The only stipulation is that the phones being connected must both belong to a cable company customer. To this end, several Internet service providers have become clients of these cable companies, enabling their subscribers to surf the Net through the evenings and weekends without having to pay a penny for the ir calls. Diamond customers need pay only ú7.00 a month for a telephone line, with no obligation to take the television service as well, while Nynex users, who must rent the phone line, the standard television service and a premium movie or sports channel, pay almost ú30 a month. But now it would appear that Nynex and Diamond have had enough. According to The Independent, Manchester-based Internet service provider U-Net has received a letter from Nynex saying it intends to withdraw its free local call offer from Internet service providers’ Nynex lines, claiming that its network is ill-equipped to deal with users hogging its exchange switches. But Nynex denied this, saying the company has made no firm plans yet and is still investigating all the possibilities for change. Meantime Diamond said it is also planning to stop free calls to Internet Service Providers with Diamond telephone lines. It said its free calls scheme was never intended for business services. How much this has to do with the cable companies’ own Internet plans is a moot point: Diamond is currently running a pilot Internet service offering digital ISDN and standard modem access, and the full service is expected to be up and running by October this year. But it said it will not give subscribers to this service free access. For its part, Nynex refused to comment on suggestions that it intends to set up its own Internet provider. Surfers in London and Southampton, covered by the Videotron Ltee cable franchise, may be more fortunate: the firm said it has no intention of giving up free calls to Internet providers, despite the fact that its contracts state that only voice calls are eligible for the free phone call scheme. This, it said, is because it profits from the voice calls Internet users make after they have been on line. There could be changes ahead though. The company is considering the options for setting up an Internet Service Provider of its own and, if that happens, it’s possible that it too will withdraw free phone calls to other service providers.

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