AltaVista puts high price on unmetered access

AltaVista has announced pricing details for its unmetered internet service, which launches later this month, but the service will be more expensive than anticipated.

Users will need to pay a start-up fee of £59 (including VAT) when the service launches on 30 June. AltaVista said in March that the service would cost between £30 and £50.

There will be no monthly fees (although the £59 can be split up into 12 monthly payments), no minimum spend on voice calls and no need to change telephone service. However, there will be an annual renewal charge, which has yet to be decided.

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AltaVista admitted that the pricing is more expensive than it first anticipated, but said the increase was needed because it had decided not to bombard users with adverts and marketing email to generate revenue.

AltaVista said the pricing, including the £59, could go down once BT announces how much it will charge for its wholesale unmetered service - called Friaco (flat rate internet access call origination) - that regulator Oftel last week ruled it must offer.

Andy Mitchell, managing director of AltaVista UK, said: "As the first company to recognise the need for free internet access in the UK, AltaVista's leading the industry in explaining the implications of this change. We will also be the first to bring the real benefits of Friaco to our customers."

Customers will not need to change their phone operator and the service has no time limit - some unmetered services cut users off after only 10 minutes of inactivity. Although Mitchell said a cut-off after two hours of activity may be introduced to maintain service quality.

Established ISP Claranet will provide the connectivity. AltaVista's helpline number will be charged at national call rate.

Customers who have already expressed an interest in the service will be notified about the new details over the next two days. Within two weeks, customers will be "invited to come on board", said Mitchell.

AltaVista said in March that it would initially limit the sign up to 90,000 customers, to prevent the congestion that has troubled other services, including Telewest and Liberty Surf.

"It is difficult to predict demand and also to handle it. The most any company can do is offer superb telephone support and make sure the bandwidth is there," said Mitchell.

AltaVista will also announce a partnership with a broadband provider over the next month, according to Mitchell.