Carphone Warehouse bundles free broadband with phone service

Mobile operator offers fixed price service for internet access and international calls

Carphone Warehouse has announced that it will throw in a free broadband connection for some of its Talk Talk customers, shaking up the market for Internet access.

From today, customers of the company's fixed-line Talk 3 international calls package can get a broadband connection of up to 8 Mbit/s with a 40Gb monthly cap bundled in at no extra cost.

Customers will continue to pay £9.99 per month, plus the usual £11 line rental.

For this price, customers will get unlimited local and national calls to any landline in the UK and unlimited international landline calls to 28 countries (including those in the EU, Australia, New Zealand, Canada and the USA).

There is a one-off connection fee of £29.99 to sign up for the package but Carphone Warehouse said the service could save some broadband users up to £400 a year.

Chief executive officer Charles Dunstone said: "For too long the British public has been charged costly fees for high-speed internet access, or has had to use slow internet connections. We are bringing this to an end.

"High speed internet will now become a standard service in the home - just like radio or television. The change this represents for society is huge. This is the tipping point."

Carphone Warehouse entered the local loop unbundling market last year, and is currently installing its own equipment in 1,000 BT exchanges, a process it expects to complete by May 2007.

This means it will use its own equipment to run its broadband services, rather than using BT's.

BT upgraded its exchanges last month so that Internet Service Providers could offer faster broadband connections of up to 8Mbits/sec, and many have passed this speed boost on to customers for free.

Others, such as BT, demand customers sign up to a new 12 month contract. One, Newnet, has responded by offering broadband for as little as £5, but with a catch.