BT cuts internet phone charges

BT has responded to this week's flood of cheap internet access offers by cutting the cost of its internet phone charges.

From 1 June, residential customers using BT's Surftime package can have unmetered 56Kbps internet access at any time using any participating ISP for £29.25 a month. Businesses will get the same deal for £29.74 a month.

The prices don't necessarily reflect the price the end user will pay. BT said ISPs could impose an additional charge if they chose to.

The tariffs, which will use an 0844 number, are more than £5 a month less than BT had initially proposed, but remain significantly more expensive than the unmetered services planned by NTL, Altavista and the £10-a-month service available from Telewest.

BT announced other tariffs including weekend and evening access for £15.25 a month with up to 80 minutes of inclusive voice calls. Customers can also pay £9.26 a month for 1p per minute daytime access, 0.6p per minute evening access and 0.5p per minute weekend access, all including VAT.

Critics have accused BT of hampering the growth of the internet in the UK with its local phone charges, citing the US where local access is free. BT said today: "In the US, typical customers with similar internet usage patterns would pay around £5 per month more in total."

BT also revealed today that it will shortly announce retail prices for its high-speed asymmetric digital subscriber line (ADSL) service. The telco is installing ADSL equipment in exchanges in major UK cities, and the first commercial services are due this summer.

Altavista said this week that it will offer UK internet users unlimited access for a one-off fee of between £30 and £50 and an annual payment of £10 to £20.

NTL also announced that it will offer free and unmetered internet access in the UK from April for users of its phone service. Other telco customers will need to switch to NTL and spend at least £10 a month on voice calls to get the same deal.