Colt turns to flat-rate Ethernet pricing

Colt has changed its pricing for Ethernet services so its rates are not dependent on distance.

Instead, the London-based carrier now offers a flat-rate pricing model based on bandwidth alone. The move, announced on Tuesday, could benefit companies with multiple European sites.

"Inter-country communications and transactions are crucial to the success of any large business, whether it is a bank, media company or legal firm," said Colt's major enterprise chief, Detlef Spang, in a statement. "At Colt we are working to simplify pricing structures to ensure it is as easy as possible to set up international communications services."

Mike Hollands, head of solution marketing for Colt, told ZDNet UK on Tuesday that the carrier had adopted its new pricing model for three reasons: to make it simpler for customers; to make Colt more efficient internally; and as a marketing tool to emphasise Colt's European presence.

Also on Tuesday, Colt laid out considerable expansion plans for Eastern Europe. In May, the carrier will connect points of presence in Budapest, Bratislava, Bucharest, Krakow, Prague and Warsaw. The expansion will let Colt offer direct connectivity to its portfolio of voice and data services without having to rely on third-party carriers.

"We are expanding into six Central and Eastern European cities," Hollands said. "We expect this to be of interest to companies that have bought subsidiaries in Eastern Europe, and to those companies which already own companies there."

Rupert Wood, principal analyst at Analysys Mason, noted that the expansion into Eastern Europe would make sense for Colt, but warned that the Eastern European market for datacoms is shrinking.

"It's a difficult time to get into that market, but Ethernet is the right product for that market. The value of business network services is falling everywhere, but particularly hard there," Wood said.

"But competition is not so fierce there, and [entering the market now] will allow operators to capitalise on renewed growth after the recession."