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BT Wholesale drops one price, and increases two others
Thursday 04 September 2003 17:58:00 by Andrew Ferguson

BT Wholesale has issued a press release detailing some price changes that affect the 2Mbps services and Datastream based products.

The basic DSLAM port cost per end-user on all ADSL BT Datastream products is dropping 50pence to £8.05+VAT. The service provider then adds on the cost of all the back-haul rental to this, which will vary according to what level of contention and line speed is supplied. Some of this back-haul pricing was covered here. This price cut will take effect from Friday September 5th 2003.

The price rise is £5/month on the BT IPStream Office 2000 and BT IPStream S2000 products. This increases the rental from £38 to £43 on BT IPStream Office 2000, and £43 to £48 on BT IPStream S2000 which is the engineer installed product. Earlier in the year, these two products had been priced at £80/month so they are still substantially cheaper than at the beginning of the year. This price rise is not due to come into effect until October 16th 2003.

BT says in the press release "These changes will mean that wholesale customers taking Datastream will have more flexibility in competing with BT's IPStream products in what is already Europe's most competitive broadband market."

Which is true, raising the price of the IPStream 2000 products will give people like MediaWays, Bulldog, Thus and Tiscali and bit more room to compete price wise. But I suspect this was not quite the sort of repositioning in pricing that many expected. The label of Europe's most competitive broadband is perhaps one that many would contest, particularly with the relatively limited coverage of Datastream products outside the South East still.

Quite what the service providers reactions will be to this news is unclear, some may manage to absorb the price rise, but for the lower priced operators a £5 increase is a fairly large chunk of their margin.

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