British Telecom: $40 for "40" down, 10 up
Written by Dave Burstein   
bt_booth_ingyVirgin is selling 50 down DOCSIS 3.0 for £28 and winning many customers from BT according to rumor. BT responded by finally starting construction on their DSL/fiber upgrades, after delaying in the hope of a big government subsidy.  To stay in the game BT has set the price at £20 for a 20 gigabyte/month "up to 40 down" plus initial charge and £25 for a more appropriate "unlimited" 40 down, 10 up service. $32-40 is cheaper than AT&T (24 meg $65) but more expensive than France. Fewer than 40% of Britain will be reached in the next two years, the vast bulk in the half the country that Virgin is serving. Most of the other half of Britain will half to wait years before they get 21st century Internet speeds. Andrew Parker (FT) reports BT is demanding a government subsidy to do even DSL/FTTN upgrades for most of the country. Given that AT&T will already have reached 70% with FTTN by then without subsidy, and Verizon 70% with fiber all the way home, it's hard to see why BT can't afford more investment.

"Up to" speeds are inherently deceptive, of course,

with OFCOM tests showing many DSL customers actually getting half the speed advertised. Cable modem customers get a significantly high % of the speeds promised. Based on AT&T experience with similar FTTN builds, I'd guess that 50-70% will get 25 meg or more and significantly fewer the 40 megabits, unless DSM Level 3 gear is out of the labs and into BT's cabinets by then. Only BT has the data for a more accurate estimate, and they ain't saying anything.There's little practical difference for most customers between 30 megabit and 50 megabit speeds, but the experience in Japan is that the perceived difference draws subscribers.

John Petter of BT "said the pricing of the superfast broadband service would ensure it became a mass-market phenomenon. 'The name of the game for BT is getting customers to come back to BT for all their services," he added. I suspect BT Retail is taking very slim margins after paying BT Wholesale/Openreach in the hopes of winning voice customers. If so, then CW TalkTalk and Sky won't be able to price much cheaper unless they build their own local fiber. Charlie Dunstone is talking about doing just that.

Dunstone is looking to become a hero of the British Internet. He's very publicly opposing the Labour Government's plans to shut down people's net connections for file sharing because of the high cost of monitoring all the traffic. The monitoring cost estimates of half a billion a year are overstated, but so are all the record company claims of their huge losses.

Price comparisons are getting much less accurate because most homes take bundles, but I think these are not far off. BT is requiring an £11 phone line, while Virgin charges £5 if you don't pay by direct debit. AT&T demands you take a TV package.