Price competition for entry-level broadband has forced BT to reduce the cost of its cheapest broadband service - BT Broadband Basic - to £17.99.
This represents a 10% cut on the previous price and will make the service an attractive option for small businesses, home and remote workers.
BT had refused to cut the price of Broadband Basic when it cut the price of its other, more expensive services, but is now facing increased competition. Wanadoo, for example, is offering a £17.99 entry-level broadband service.
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Customers using BT Broadband Basic get a top data speed of 500kbps and a monthly data allowance of 1Gbyte, but Wanadoo offers a top speed of 1mbps and a monthly data allowance of 2Gbytes for the same price.
Duncan Ingram, managing director of BT Openworld, said, "BT is now extremely hard to beat in terms of combined service and value, and BT Broadband Basic is now cheaper than a number of our major rivals and extremely competitive against other entry level broadband products."
Research company Baskerville estimates that 40% of all DSL lines currently sold in the UK are bought directly from BT, with the rest sold by companies like Wanadoo relying on BT’s DSL infrastructure.