Europe South Asia Asia Pacific Americas Middle East Africa BBC Homepage World Service Education
BBC Homepagelow graphics version | feedback | help
BBC News Online
 You are in: Business
Front Page 
UK Politics 
Market Data 
Your Money 
Business Basics 
Talking Point 
In Depth 
Tuesday, 7 December, 1999, 17:57 GMT
Q&A: Unmetered internet access

BT plans to introduce unmetered access to the internet, allowing customers to connect for as long as they want for a fixed monthly fee. BBC News Online explains what it all means for the average internet user.

How much will individuals save on their telephone bills?

Unlimited access to the internet for a fixed rate benefits heavy users most.

If you use the internet more than one hour a day outside office hours, you are likely to gain by purchasing one of BT's off-peak tariffs.

Even at the cheapest rate for local phone calls, 1p per minute, you would have been paying 18 per month in telephone charges.

Light users, however, may find that their internet phone bills are lower than the minimum of 6.99 a month BT will be charging.

Any drawbacks?

You may have to change your internet service provider. It is not yet clear how many internet service providers (ISP) will be offering the new tariffs. They will have to reach agreement with BT first over their charging structure.

And you can't sign up yet. The plan does not come into effect until January 2000, subject to regulatory approval.

But isn't there free internet access already?

There are more than one hundred UK companies that provide "free" internet access - the most well-known being Freeserve.

But they all charge you the cost of a local telephone call, and recover their own costs by taking a proportion of that telephone revenue (which BT is required to share with the ISP's telecoms company of choice).

However, there are already a few companies that offer completely free access., for example, allows users to log on for free at weekends and off-peak times, but you have to sign up with a new telephone company, Locatel, to access the service.

Some other companies have offered free shares, or free computers, in return for signing up for their service.

How does the situation compare to other countries?

Even with unmetered access, prices in the UK will still be somewhat higher than in the United States, where most customers receive unlimited access for around 15 per month.

The cheap cost of accessing the internet has meant that more people in the United States have an internet connection, and e-commerce has generally developed further.

In continental Europe, most internet access is still through local telephone companies, like Deutsche Telekom's T-Online. They tend to charge on a metered basis. Although some newer start-up companies offer cheaper or free services, their growth has been limited by the fact that the telephone market is only beginning to be deregulated in most European countries.

Why is BT taking action now?

BT has been forced to act by the government regulator, Oftel. It is concerned that people are being charged too much for local internet calls, which generally last much longer than ordinary phone calls.

Oftel wants to change the charging structure, allowing a greater choice of how to pay for the internet.

The current proposal is part of BT's response.

Why is this development so important?

The government believes that the UK must get ready for the digital age, but that access to the internet is being held up by expensive telephone charges.

Unmetered access is seen as a way to encourage more people to use the internet for longer, thus allowing more e-commerce, with customers no longer reluctant to look through online catalogues or download information from the web.

In the United States, where unmetered access is the norm, people log on, on average, three times as long as in the UK.

Why are other companies unhappy with BT's behaviour?

Many other internet service providers are sceptical of BT's motives.

They argue that because BT's service will only be available to other ISPs who do a deal with BT, it will drive many smaller operators out of business.

Many of BT's rivals are also angry that BT has taken so long to roll out new digital services that would allow high-speed internet access.

The telecoms regulator, Oftel, has now said that BT has to allow other companies to install the equipment for such services in its exchanges.

Is this a step in the direction of completely free access to the net?

Not necessarily.

Companies which provide free net access will still have to find some way to pay for the service, either through advertising on their site, e-commerce sales generated through links on their site, or telephone charges.

Some of the smaller ones may well be forced out of business by BT's move.

But the proposal does mean that there will be a bewildering variety of charging plans on offer.

And in the free-for-all, most customers will probably find that by shopping around they may get a cheaper deal than they had before.

Search BBC News Online

Advanced search options
Launch console

See also:
07 Dec 99 |  Business
BT offers unmetered net access
11 Nov 99 |  The Company File
BT's 'flawed' internet deal
10 Nov 99 |  The Economy
BT cuts internet call costs
30 Jul 99 |  Sci/Tech
ADSL priced high for consumer
Links to other Business stories are at the foot of the page.

E-mail this story to a friend

Links to more Business stories