Word is being passed around ISPs of a major shake-up in the UK broadband ADSL market, specifically relating to the choice of how hi-speed access is delivered (via BT) to providers and thus consumers. Usage based charging is one among several changes being discussed:

A little explanation on each of the current, and proposed methods is shown below:

Standard pricing, the current price model. Which involves an end-user payment for every ADSL line, and a flat-rate cost to the ISP for its BT Central product. For example a Home 500 line is £13/month, Office 2000 is £43/month and the ISP pays £3,750 per month for a 155Mbps BT Central which holds up-to 8000 sessions. One ADSL line is equivalent to one session.

Capacity based pricing. This option reduces all the end-user line costs to the same fee e.g. £9/month, but the BT Central price rises to £26,350 a month for the 155Mbps L2TP product. The pricing is flat-rate though, with ISPs controlling contention by how they populate the BT Central. BT Symmetric products would also switch to a flat rate cost perhaps around £100 per line per month, irrespective of the actual line speed. Expected launch date is June 2004.

Usage charging. Again a move to a flat-rate charge for the ADSL line port, i.e. Home 500 costs the same as Office 2000. The BT Central pricing remains at £3,750 for the 155Mbps pipe, but an element of usage charging is introduced. In this price model BT Wholesale is suggesting the usage charge would be cost neutral if the average use of the BT Central product was 20kbps per user (20 kilo bits per second per user). This equates to a daily download of 200MB (Mega Bytes), or 6GB per month. Expected launch date is November 2004.

BT Central Plus. The product used solely by BT Broadband and BT Yahoo under the BT Retail umbrella is also set to change, proposed pricing is £28,500 per 100Mbps of capacity, and as more bandwidth is used the montly rental will automatically increase. Each 100Mbps block will carry a £30,000 connection fee.

Currently such changes can be looked at as little more than the introduction of added choice, however there are fears that the 'Standard Pricing' model could one day disappear.

On top of that we fear that BT is not the best group to be deciding upon any unilateral bandwidth limits (usage charging). By example, their 1Gb per month products are hardly inspirational or accommodating of a broadband future where affordable ‘flexibility’ is required.

ADSLGuide does a good job of highlighting all of these concerns along with any possible benefits. Like them, we also wonder why BT is doing its sums based on a 20kbps average per user?