Press & PR

Despite the recent surge of buy-outs in the broadband market, it has been claimed that competition still keeps companies striving to find new ways to attract customers, says a leading industry commentator.

While recent launches such as those from BSkyB and Virgin Media both of which had deep pockets to fund and find a foothold in the market, recent take-overs have seen Be There bought by O2, Madasfish and Plusnet swallowed by BT, while a large chunk of Pipex was purchased by Tiscali.

Although this means that just six providers account for 94 per cent of the market, the director of BroadbandChoices.co.uk, Michael Phillips, said that the competition between these firms was still fierce.

"Smaller ISPs often struggle to keep their place in the market and the past year has seen a rash of consolidations and take-overs as the likes of BT and Tiscali vie for an ever bigger slice of the broadband pie," he said.

But he added: "As the pool of customers completely new to broadband dries up, providers have to devise new ways of tempting consumers away from their rivals."

Phillips says this now involves creating an all-in-one package bundling together other products such as mobile phone contracts, satellite TV or free line rental for their home phone.

But many consumers still refuse to 'bundle' their services and instead choose to pick 'best of breed' suppliers, for example choosing VoIP providers such as Vonage to replace their incumbent home phone provider.

Vonage provides unlimited calling from £5.99 a month in the UK and Ireland to anyone equipped with a touch tone telephone and a broadband interconnection – using their normal household phone.