BT cuts prices in business broadband bonanza

And hints that ADSL could reach 90 per cent of the population soon(ish). Are you rural types happy now?

BT is slashing the cost of its business broadband products by more than 50 per cent - one of several developments announced by the telco on Thursday. From 1 May the cost of IPStream Office 500, BT Wholesale's entry level broadband package that gives business users a 500Kbps connection, will fall from £40 per month to £18 per month. IPStream Office 1000 will drop from £60 per month to £28 per month, and the top-end IPStream Office 2000 service will cost £38 per month, down from £80 per month. Ben Verwaayen, BT's chief executive, told journalists that the price cuts reflect the fact that high-speed internet services are now a vital tool for small and medium-sized businesses. "These are dramatic price cuts for business users," Verwaayen said. As predicted, BT is also reducing the cost to ISPs of its consumer broadband service by £1.75 per month to £13. Some ISPs are concerned that this cut is of little real significance as the saving is being cancelled out by the return to a £50 activation fee and a small increase in another connection charge. However, Verwaayen rejected such claims. "This is a real price cut on a wholesale level," insisted Verwaayen, adding that it gave ISPs the choice of passing the saving onto consumers, differentiating their product line from their rivals, or improving their margins. BT also announced that various technological breakthroughs would allow it to set trigger levels for local exchanges previously seen as unviable for ADSL. A total of 600 additional trigger levels will be announced by early summer. If all 600 exchanges hit these trigger levels and are upgraded, ADSL will be available to 90 per cent of the population. Verwaayen also announced that 80 per cent coverage will be achieved by 2004 - a year earlier than previously thought. Graeme Wearden writes for ZDNet UK