AOL challenges BT over ADSL

AOL turns its attention to broadband Thursday and promises BT it is prepared for a fight.

The ISP has been one of BT's greatest critics, lobbying for unmetered access for the last two years. Now Friaco (BT's wholesale unmetered offering) is beginning to roll out across the UK AOL has turned its attention to broadband.

"We are about to go charging in big time on ADSL. It is in danger of becoming a complete shambles," warns an AOL spokesman. He highlights the geographical limitations of the technology as one of the biggest problems.

The government has made it clear it wants universal access to broadband but BT admits 30 percent of the UK will still have no ADSL access by the end of next year. "Twenty-three million people will not have any form of ADSL access in any meaningful time-frame. It is a real concern that BT is allowing another divide between town and country," says the AOL spokesman. The ISP is also concerned by the technological limitations of ADSL. Only users who live within a 3km radius of the local exchange will have access to it.

Price though remains the biggest bugbear to AOL. With a wholesale price tag of £35 and a £150 instalment fee for each user, the ISP is concerned no operator will be able to roll it out to a mass market. "This is a really big problem," the spokesman says.

Unsurprisingly BT defends its ADSL strategy. "Seventy percent coverage by the end of next year is extremely aggressive," says a spokesman. He claims BT is currently testing satellite broadband alternatives for the rural areas that will not be covered by ADSL, adding that ISDN is also available "pretty much everywhere".

Critics have suggested in the past that protection of its ISDN business lies behind BT's sluggish attitude to ADSL roll out. Microsoft's UK managing director Neil Holloway complained Thursday that the telco is deliberately delaying ADSL roll out. According to study by research firm Ovum, ADSL will not be a feasible broadband platform for rival telcos and it suggests fixed wireless is a better and cheaper alternative.

Check out ZDNet's Interactive Broadband Guide

Take me to the Unmetered Access Special

To have your say online click on the TalkBack button and go to the ZDNet News forum.

Let the editors know what you think in the Mailroom. And read what others have said.