Comment: Free services threaten UK's broadband future

 

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By Barry Collins

Posted on 9 Oct 2006 at 12:03

Yet, even if BT's investment in the next-generation network survives, it seems likely that some of the traditional ISPs won't. All of the ISPs we've spoken to bullishly claim their subscriber growth has been unaffected by the booming popularity of the 'free' providers, claiming that the bulk of customers flocking to the freebies are either broadband newcomers or perennial switchers who always look for the cheapest deals. However, they all concede they're in discussions with potential partners to offer mobile or television packages.

Zen Internet claims it will continue to thrive thanks to its business customers, who are unlikely to entrust their connection to providers who only supply broadband as an additional extra. 'Business customers want an Internet connection they can rely on, that's well supported,' says the company's managing director, Richard Tang. Nevertheless, Tang concedes that, 'independent ISPs in the consumer space have something to worry about'.

With brokers declaring that the broadband market is swiftly becoming a bloodbath, the warning signs are looming large for Britain's Internet industry. A period of consolidation seems almost inevitable. The free dial-up revolution pioneered by Freeserve in the late 1990s brought the British internet industry to life; the free broadband movement of 2006 could be remembered as the initiative that killed it.