New ISDN prices could lure users

BT today confirmed plans to adopt a modular approach to ISDN pricing, taking advantage of burgeoning interest in high-speed communications.

With the growth of the Internet, teleworking and other trends leading businesses to re-examine bandwidth issues, ISDN could finally be poised for sharp growth according to analysts, and the price restructuring was welcomed by the industry.

BT's new scheme introduces three options for ISDN-2 customers: Start Up, Fast Start, and Low Start.

Start Up is aimed at attracting new users with a £199 connection charge and a £90 call allowance for the first two years. Fast Start, for experienced ISDN users, offers a connection charge of £680 and £650 call allowance. Low Start, for low usage users, maintains the old £400 connection charge with rental at £450 per year, but users get a £210 per year call allowance.

In all cases, the rental charge is higher than the old £336 per year rate but BT claims that most users should end up paying less under the new scheme, and say it should be particularly attractive to home and small business users.

Bill Pechey, chief engineering officer at modem and ISDN hardware giant Hayes, welcomed the new structure. "They want to stimulate the market but they also want to get a return on their investment," he said. "It still costs a lot to install ISDN and BT wants to amortise its costs over a longer period. Customers pay for the installation in the rental and are given a discount on calls. Some people don't think it goes far enough but I think it's what the industry wants. It makes it possible for smaller users to take up."

Pechey disagrees with analysts who believe ISDN could be bypassed in favour of other high-speed technologies such as cable. "It's generally computer industry people who say that. In comms, things take a long time to change. Investments are written down in anything up to 25 years. Cable firms will come in and try to sell cable modems but the industry isn't going to throw away the ISDN infrastructure that's already there. If anything, ISDN-6 is the biggest threat to ISDN-2."

Pechey also believes that ISDN mind-share is on the up, thanks to media coverage and BT itself. "BT has improved a hell of a lot. It only takes a few days to get an ISDN line installed. People will slowly start to change their view of ISDN as expensive. Modem sales won't be hurt but ISDN has a bright future."

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