BT's announcement that it was to unwrap a super-fast 40 megabit per second service for less than £20 a month was expected to herald a new price war among broadband suppliers in the UK.
Mid-February 2010 saw the first time that customers in the UK could choose between two super-fast broadband providers after BT announced it had laid enough fibre-optic cables under the street to start its 40Mb a second service.
Until then, Virgin was the only company to own fibre optic wires under the streets of Britain, taking advantage of this to offer a 50Mb a second service. About half the country’s population live close enough to a Virgin cable to be able to use the service, according to Broadbandgenie.co.uk.
Downloading a 12-track music album from a service such as iTunes takes three minutes on an 8Mb service, but just 36 seconds down a fibre optic connection.
Next week just a few hundred thousand customers will be able to be hooked up, in parts of Cardiff, Muswell Hill in London and Glasgow to BT’s fibre optic cables. But by the end of the month most of Manchester, north London, Basingstoke, Watford and Halifax will have the service.
BT’s cheapest deal at the super-fast speed of 40Mb a second is just £19.99 a month, £8 cheaper than the 50Mb a second service from Virgin.
Michael Phillips at price comparison site Broadband Choices said: “This is great news for customers that you have two major, big competitors fighting for customers.
Virgin said that it not only offered faster speed but it was also more generous with its “fair usage” policy. So far none of its estimated 40,000 customers on its super-fast service had ever stepped over its “unlimited” level.
BT, in contrast, said that customers on its £20 a month service have a 20GB monthly limit, the equivalent of watching the BBC iPlayer programmes for an hour and a half every day. On the more expensive package of £25 a month, consumers could download “unlimited” amounts of data – which meant up to 100GB a month.
Gavin Patterson, chief executive officer of BT Retail, said: “The internet is essential to our customers’ lives and they are demanding more and more as richer and even more compelling services become available.”