BT vows to keep cutting ADSL costs

BT has reassured frustrated customers that it is planning to make further cuts to the price of ADSL services in the months ahead.

Pierre Danon, chief executive of BT Retail, acknowledged on Wednesday that cable companies are undercutting Britain's incumbent telco when it comes to high-speed Internet access. Danon put some of the blame for this on the regulatory framework that BT must work within, but promised that broadband would become more affordable in the future.

"I agree that today consumer prices especially are too high," said Danon, who insisted the BT was making a big effort to cut cost. "We have already shown to the market that we intend to reduce price by reducing our wholesale price a couple of months ago. You can be sure we will continue," he added.

Danon was taking part in a live Webcast debate answering questions about the digital divide.

BT recently cut the price of its wholesale broadband product - -which it sells to rival ISPS as well as BTopenworld -- to £30 per month. BTopenworld's home ADSL package costs £39.99 per month, while cable firms Telewest and ntl offer broadband from £25 per month.

Danon did not make any price announcements, but guaranteed that BT's ADSL offering would soon be improved. "We are committed to significantly improving the overall attractiveness of the service and cost is just one element. Watch this space," he said.

Suggestions that BT might be planning to drop the price of broadband will doubtless please Douglas Alexander. The e-commerce minister said last month that it was important for BT to do its bit to push broadband take-up, including cutting prices.

BT insiders responded to Alexander's comments by pointing out that the government's Broadband Stakeholders Group recommended over 40 actions that could be taken to boost the take-up of high-speed Internet access, and only mentioned BT once.

Meanwhile, a report due out on Wednesday will claim that the UK economy is suffering from a lack of broadband. According to the Communications Management Association, two thirds of companies responding to its survey said they wanted affordable broadband access but were unable to get it.

BT's position, however, is that there is plenty of broadband around but a lack of awareness of its benefits means that small and medium-sized firms don't believe it is worth the cost.

See the Broadband News Section for the latest on cable modems, ADSL, satellite and other high-speed access technologies.

Have your say instantly, and see what others have said. Click on the TalkBack button and go to the Telecoms forum.

Let the editors know what you think in the Mailroom. And read other letters.