The competition between BT and Carphone Warehouse to lower the cost of SME broadband will help 4.7 million small businesses survive and prosper during the recession.
BT and Carphone Warehouse’s TalkTalk business arm, Opal, have both launched SME broadband packages for as little as £10 and £15 respectively.
Although both firms claimed that the timing of the launches was a complete coincidence the Federation of Small Businesses (FSB) welcomed the competition.
Stephen Alambritis, head of public affairs at the FSB, said small businesses are feeling the impact of the recession and any savings are welcomed.
“If the suppliers go into battle to provide as competitive a price as possible it will help them,” he added.
He said the FSB welcomes new suppliers into the business broadband market to reduce BT’s dominance. “It is always the case when there is a monopoly that prices are higher than they should be.”
Opal said it wants to win 20% of the SME market while BT said its announcements were part of a package to improve its business broadband offerings. BT launched a package for £10 per month.
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The 24 Mbps service from Opal gives business users priority over the network, and uses the TalkTalk group's next-generation network. The company has spent £200m on the network, which now covers more than 80% of the UK's users and supports more than1.4 million broadband customers.
On the same day that Opal launched its new package BT announced price reductions.
The price of BT’s Broadband Option 3 will be reduced by a 35% from £40.50 to £30 per month. This will include mobile broadband connection, at no extra charge.
Option 1 will now be £15 per month from £19.79 before.
Option 2 is being reduced to £25 from £26.99.