BT is to start trials of a new 128Kbps internet connection in the spring, which could bring higher-speed internet access to areas not currently covered by broadband.
The Midband trial will start in March or April, but a BT spokesman would not reveal where the trial will take place.
The telco has described Midband as an alternative high-speed access product for areas that can't get broadband coverage.
It is testing a number of different technologies, but the end product could be based on BT's existing HomeHighway ISDN service which consists of two 64Kbps links bundled together to create a 128Kbps channel.
But it is likely that whatever technology is chosen, it will not require local exchanges to be upgraded, according to BT.
This means that Midband can potentially reach 97 per cent of the country, much more than is covered by broadband.
While the new service will not be completely always-on, it will provide always-on email.
Mark Mulligan, a broadband analyst with Jupiter Research, said Midband would fill the gap between dial-up and broadband provided the price is right.
"Midband is increasingly popular in Europe," he said. "It could find a large market in the UK as it meets the needs of most people who never need to use the bandwidth that broadband supplies."
BT has indicated that the cost of midband could be £20 to £25 per month, the same as some broadband services.
Other operators offer similar services. Tiscali provides a 256Kbps service at £19.99 per month, and NTL has a 128Kbps service at £14.99 per month.
BT said that it is considering offering a wholesale version to other internet service providers, which could lower costs.
"Although it is speculation to talk about offering a wholesale product, it is something we could be looking at. It's a case of watch this space," a BT spokesman told vnunet.com.
However, Oftel is unlikely to allow BT to monopolise the Midband market.
"If other operators said they wanted to offer a midband service, we would consider analysing the situation," said a spokesman. "We have to complete reviews of the broadband market by July."
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