BT Wholesale has announced to Ofcom its intention to reduce the end-user monthly rental fees by £1 per month from 1st June 2004. This means that the cost to providers for a Datastream connection will be £74.60 per year (87.66 inc VAT).
The price cut is not massive, and whether providers selling Datastream products will pass on the saving is unclear. A key point with the Datastream products is that the actual cost of the back haul from each exchange must be accounted for, along with a providers normal overheads. In fact it can be suggested that the Datastream providers would be better using this price cut to help finance further roll-out of their services, which are only available on a sub-set of the ADSL enabled exchanges.
The Datastream market is often held up as an example of competition in the UK broadband market place, but this does not always translate to good products for the end-user. Datastream based products are driving down the price of ADSL broadband in the UK, but it can seem that quality of service is suffering. The real question on the quality of service issue is whose fault is that? Is it the fault of Datastream providers cutting the budget and installing the minimum amount of infrastructure, or are BT Wholesale too slow to respond to upgrade requests to the Datastream network? The providers involved would appear to stay tight lipped on the matter, and often simply say they are talking to Ofcom.
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