Following BT’s decision to slash the price of wholesale ASDL access, ISPs will be more willing to publicize broadband products. Having pushed for a reduction in prices, AOL is already planning to rollout ASDL services to the mass market. BT’s price cuts, coupled with AOL’s large-scale marketing campaigns, is likely to make ASDL a popular service.
BT’s ASDL price cuts have encouraged AOL to promote its broadband products.
BT has confirmed that it will be cutting its wholesale broadband prices by 50%. By April 1, 2002, the company will offer reduced price packages for new and existing customers. BT hopes that ASDL will be far more accessible to the home user and it aims to have added one million broadband customers by 2003.
These moves have been endorsed by AOL UK, which has been urging BT to change its approach to UK broadband for some time now. The giant ISP is only one of 200 that offers the use of BT’s broadband product. However, AOL had been reluctant to promote its BT-based ASDL products because of the inflated prices.
The monthly retail cost of ASDL will drop to GBP30, which means that ISPs will be able to promote broadband to a much wider audience. The service provides high-speed and continuous Internet access for users. At present there are only 145,000 such customers but this is likely to surge once the new pricing system comes into place and ISPs launch marketing initiatives.
AOL’s only worry is the availability of the product, but BT has also promised to expand the service beyond its 1,010 urban exchanges and is looking to find partners to share the cost of infrastructure to reach the UK’s rural areas.
The price cut will no doubt boost the number of subscribers in the UK broadband market and ISPs will be in a position to offer competitive retail rates to their customers. At last the tide is starting to turn in favor of UK broadband consumers.
