BT offers unmetered access, but only in towns

A deal struck between British Telecommunications and telco WorldCom was paraded Wednesday as evidence that BT is on the side of unmetered access in the UK. However, industry insiders have told ZDNet that the service will only be available to urban surfers.

AltaVista and other ISPs struggling to maintain unmetered services under BT's current charging regimes have been screaming out for Friaco -- a wholesale unmetered product that would allow rival telcos to lease bandwidth from the company. BT insists it has had Friaco in place since July and claims WorldCom has just signed up.

While it is true that WorldCom has signed a deal, a ZDNet investigation reveals that it is not quite how BT paints it, as it will only be suitable for large ISPs and for users who live in towns.

While industry wants a fully unmetered product that lets operators lease bandwidth from a user's house through to the main telephone exchange, Wednesday's deal combines elements of Friaco (which allows operators to lease bandwidth) with leased line contracts (in which operators lease individual lines). ZDNet has learned that under this system, it would only be cost effective for operators to lease lines in densely populated areas.

BT admits the deal is not pure Friaco and that it will only be suitable for urban areas. "Most ISPs want to roll out services in towns, that's where they want to cherrypick. They don't want to roll out in regions that are less densely populated... it is not economic to do that," says a BT spokesman.

So is the deal the same Friaco that industry has called for the past year? "Depends what you call Friaco," says the spokesman.

Analyst with research firm GartnerGroup Adam Daum confirms the deal will disadvantage users in rural communities and could be a marketing fiasco for ISPs. "It will only be suitable for major ISPs and will not be any good in rural areas," he says. "From a marketing point of view it is a disaster. Imagine announcing a service and then saying you can only have it if you live in these geographical areas."

A spokesman for long-term unmetered campaigner AOL accuses BT of "presenting black as white". "BT is starting to believe its own propaganda. They are saying that they are offering an unmetered connection from the local exchange to the main exchange and that is simply not true," he says.

He is amazed BT is still prevaricating on rolling out pure unmetered access. "All forces from the prime minister down are saying here is a straightforward business model that will make BT look smart and popular and give it a solid revenue stream. What is BT's problem?"

Chief executive of Totalise Peter Gregory believes consumers lucky enough to benefit from the deal will still have to wait up to three months before services become available. "If this is the first deal then there is still the problem of getting equipment into exchanges," he says.

The best you can say for AltaVista is that it may honestly have thought it could provide a profitable unmetered offering. Most of its rivals believe that if it did, it was incompetent and Guy Kewney tends to agree. "The numbers involved are complicated, and it may be that they were simply unable to add them up," said one rival yesterday. Go to AnchorDesk UK for the news comment.

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