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Last Updated: Friday, 4 April, 2003, 10:49 GMT 11:49 UK
BT accused over broadband cut
Still from BT's broadband campaign
BT accused of crushing opposition in broadband campaign
Telecommunications firm Thus has complained to watchdog Oftel about BT's new pricing structure for fast net services.

It has accused BT of a 'margin squeeze' following the announcement that the wholesale price of renting broadband lines would fall by around 2.

Thus is unhappy that the price reduction on the wholesale price of broadband has not been extended to a service used by operators, such as Thus, which allows service providers to use both BT and rival networks to get broadband to customers.

"We welcome incentives designed to encourage the availability of ADSL broadband services in the UK," said Phil Male, Chief Operating Officer of Thus.

"However, it is important to ensure that those incentives are sustainable and do not compromise the development of competitive markets," he added.

Professional complainers?

ADSL is a technology which provides fast net access via the telephone lines. Around half of all homes that have broadband use this while the rest rely on cable broadband.

We have to ask - is complaining part of their business model because when it comes to moaning and groaning...these folks are professionals
BT insider

There has been a somewhat lukewarm reaction to the price cut from the internet service providers it was intended to help.

AOL accused BT of 'giving with one hand, while taking with the other' because of a decision to raise the price of the activation fee the telephone company charges for every broadband connection.

Oftel slow to respond

Freeserve is also unlikely to pass the cost savings on to customers and is keen for other options such as local loop unbundling - giving rival operators access to BT's network - to be explored instead.

"We welcome any cuts in wholesale pricing but we also want to see the market opened up to alternative carriers," said a Freeserve spokeswoman.

"True broadband DSL infrastructure competition will only be created when the regulator realises that local loop unbundling costs must be far lower than today and comparable with other countries in the EU," she added.

BT has hit back at the gripes of the internet service providers it supplies with broadband.

"BT does nothing, people complain, BT does something, they still complain," commented a BT insider.

"We have to ask - is complaining part of their business model because when it comes to moaning and groaning...these folks are professionals," he added.

Oftel has received several complaints about BT's broadband service.

One, accusing BT of anti-competitive behaviour for its launch of the retail 'no frills' broadband service, was submitted by Freeserve in October.

The telecoms watchdog has yet to make a decision on the complaint but it is moving to force BT to slash the amount it charges other ISPs for dial-up internet access.

Changes in the way flat-rate net calls are routed means the expense BT incurs for them has lessened and Oftel Director General David Edmonds intends to ask BT to cut costs by 17%.

Mr Edmonds hopes the savings will be passed on to customers.

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