IT HAS become one of the most fiercely -contested battles of the new dot-com era.
But yesterday, telecoms giant BT promised it would stand back from a broadband price war that has led some providers to give away "free" laptops in a bid to gain custom.
Dialling up a steady rise in quarterly profits, BT said it would focus its b
roadband strategy on quality.
The former telecoms monopoly faces cut-price deals from TalkTalk-owner Carphone Warehouse, as well as new offers from BSkyB and the creation of Virgin Media following the mergers of NTL, Telewest and Virgin Mobile.
BT chief executive Ben Verwaayen said he expected the group to remain the No 1 retail broadband provider. During the three months to the end of June, its share of net additions in the competitive broadband market stood at 38 per cent.
"We have seen in many markets that throwing in unrelated stuff is not always a strategy that ... works," Verwaayen said. "I am not particularly inclined to be a big admirer of those types of actions.
"We are very competitive in what we offer," he added.
BT gained around 175,000 new broadband customers in what the group said was seasonally the slowest quarter of the year.
To help strengthen customer loyalty, the firm has launched a broadband television service, BT Vision, which involves a set-top box providing programmes on-demand.
It does not require a subscription or minimum monthly charge but is based on a pay-as-you-go model for customers who want additional content.
Verwaayen said BT had already signed around 20,000 customers to the new service and expected to have more than 100,000 by the end of the year.
The group posted underlying earnings before interest, tax, depreciation and amortisation - a key industry measure - of £1.43 billion for the three months to 30 June, a rise of 3 per cent on a year earlier.
The figure was in line with City forecasts, although shares slid 5 per cent to close at 311p, analysts noting there was little in the statement to rouse a shaky market.
Overall revenues in BT Retail were flat in the quarter at £2.06bn, with a decline of 5 per cent in traditional land-line revenues offset by growth in "new wave" revenues of 16 per cent. At the pre-tax level, profits before one-off items and "leaver costs" lifted 3 per cent to £658 million.
BT unveiled a major restructuring earlier this year, creating two new business units in an attempt to cut costs as it transforms itself from an operator with a declining fixed-line business to an IT and communications provider focused on broadband services.
