How Cheap Can Broadband Get?

As Sky Digital follows Carphone Warehouse by launching a "free" broadband service, we show you how to get faster Internet access for less cash!

On Tuesday, satellite firm BSkyB announced the terms of its "free" broadband offer -- and it will begin signing up customers next month. We've been eagerly awaiting this news ever since Carphone Warehouse laid down the gauntlet to Internet Service Providers (ISPs) when it launched its Talk3 International package in April (which I reviewed here).

BSkyB revealed that existing Sky Digital customers can have its 2Mb "Base" Sky Broadband package for free; this service is about forty times as fast as a 56k dial-up service. Sky expects around 2½ million of its eight million subscribers to sign up to Sky Broadband, which would make it one of the UK's biggest ISPs, alongside market leaders BT, AOL and NTL/Telewest.

However, new subscribers to Sky Broadband will have to pay between £5 and £17 for certain broadband services, plus their usual monthly line rental to BT:

In addition, these deals all include a free wireless Sky Broadband box and the McAfee security package for a year, plus a minimum twelve-month contract. Note that the download speeds shown above are maximum speeds; the actual speed which you experience will depend on your distance from your local telephone exchange and other technical factors. Also, if you choose to self-install Sky Broadband (or sign up to its "Max" package), then you can avoid the £50 fee for professional home installation.

In order to provide broadband to its huge customer base, Sky will spend hundreds of millions of pounds on installing its own equipment into BT's telephone exchanges, known as "local loop unbundling". Initially, this will depress the firm's profits, although it hopes to recoup its investment through the above charges. Also, as a leading media and entertainment provider, it will no doubt push its programming to Sky Broadband users. Anyone fancy watching the latest episode of The Simpsons online?

So, how do Sky's deals compare with other low-cost broadband bundles? Although they undercut the major players' broadband packages by a considerable margin, the Carphone Warehouse deal is hard to beat. Furthermore, Sky Broadband users must also have Sky Digital TV, which throws another layer of monthly charges into the equation.

For £20.99 a month (plus a one-off connection fee of £29.99), Talk3 International provides up to 8Mb broadband (with a monthly allowance of 40Gb), free calls lasting up to 69 minutes to UK geographical numbers (those beginning with "01" or "02"), free international calls to 28 countries, and even includes your monthly line rental of £11, which you no longer pay to BT. So, all these extras cost just £10 more than your normal BT line rental, which is a terrific bargain, so Carphone Warehouse's offer still appears to be the outright winner.

However, if you don't want to bundle your line rental, call charges and broadband into a single package, it still makes sense to shop around for low-cost broadband. For example, I found my current broadband provider, Prodigy Networks, by using the excellent search engine on the ADSLGuide website. I now have a wireless 8Mb service with a 2GB monthly usage allowance for under £15 a month -- which is cheaper than AOL's unlimited dial-up package!

So, why continue to pay high monthly or pay-as-you-go charges for using dial-up or big-name broadband services, when you can enjoy lightning-fast Internet access for as little as £10 a month or so? What are you waiting for? Ditch and switch ISPs today!

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