Free Internet seen triggering broadband price war

The free broadband services scheme that UK firm Carphone Warehouse recently launched is expected to trigger a price war for high-speed Internet access, a report from The Herald said.

The report said Carphone Warehouse earlier released a service that bundled broadband with UK and international calls to 28 countries for 9.99 pounds a month.

Analysts said the deal appeared to significantly undercut the tariffs being offered by competitors for broadband, although Carphone customers still had to pay a monthly line rental of 11 pounds, according to the report.

'For too long, the British public has been charged costly fees for high-speed Internet access, or has had to use slow Internet connections. We are bringing this to an end,' Charles Dunstone, Carphone Warehouse CEO, was quoted as saying.

The report also quoted Jim McCafferty, a telecom expert at Seymour Pierce, as saying: 'We believe this product is a serious challenge to established broadband providers such as Wanadoo and BT.'