WEEKLY COMMENT: Itemised billing points the wrong way

This of course allows ISPs to introduce ever more intricate pricing models and continue their price war in more sustainable fashion. However, earlier this month, we published comment by Zen Internet arguing that the price war was leading to a situation not unlike mobile phones in which users genuinely have no idea what they are paying for what, and, as a result, whether they are getting value for money. Itemised broadband billing allows us to throw ourselves headlong down this slippery slope.

Some argue that the mobile phone market is actually a model we should be looking to match. Pay as you go - as it did for narrowband access - actually opened up the market for many consumers unsure whether they would use their phones enough to warrant a subscription. And this is true, but with it came a side effect none of us should hope for - massive complexity that means even the most techno-savvy could explain what their phone subscription gives them.

The chief reason to be disheartened rather than heartened by BT's advance, however, is a more general 'big picture' sense that we are heading in the wrong direction. Generally speaking, every economy in the world wants a broadband market like South Korea. There, you can have a 12Meg connection up and running within 12 hours of asking for it - and you will pay less than we do for a 512kbps line. The reason is because of government subsidy and a love for all things techno, but also because the government set up a direct competitor to its incumbent telco. The battles the two wage for customers have meant that prices are ultra-low, service levels ultra-high, and connection speeds ultra-fast.

Shouldn't we look to achieve something like this here? Doesn't the Government want every man, woman and child on an ultra-fast broadband line to boost the country's collective effectiveness and bridge the digital divide? Yes, but instead we are clearly going the other way. Itemised billing will result in niggly price promotions and an ever more querolous battle of the brands in which competitors will be clambering over themselves to point out the difference in their helpline call charges, upload capacity, and contention ratios. This is irritating enough for those of us who know what they're talking about. For those that don't, it will act as barbed wire on an already imposing barrier.

Clearly, none of this is really the ISPs' fault. It would be nice if they could all be Zen about the whole thing and just give us straightforward packages delivering obvious and comparable benefits. But ISPs are in it for profit and, as the inevitable price war took shape, it was inevitable we would end up at pay-as-you-go and mix and match.

Thus we must look to regulation - and subsidy. Ofcom and the Government's own consultation group on broadband, the Broadband Stakeholders Group, must recommend a rethink of government policy since now is the time for it to take a hand in creating the broadband utopia it wants, or watch it frittered away in a price-point pettiness that is sure to put off the very people it wants to reach.

May 27 2004:

May 18 2004:

January 23 2004: