BellSouth Corp. has simplified pricing for its Internet access service into three tiers and is launching an ad campaign to explain the changes.
Existing customers need to call BellSouth to receive the lower rates, spokesman Clifton Metcalf says.
The move comes as the telephone and cable television industries battle over leadership in the Internet-access and digital-telephony markets.
"This new initiative reflects BellSouth's commitment to making our customers' high-speed Internet experiences simple and affordable," said Keith Cowan, president of marketing and product management - BellSouth.
Atlanta-based BellSouth uses digital-subscriber-line (DSL) technology for Internet access, while cable TV companies use cable-modem technology.
Under the new pricing, BellSouth (NYSE:BLS) is charging $42.95 a month for its fastest Internet service, called FastAccess DSL Extreme, with downstream speeds of up to 3 megabytes per second. It previously charged up to $54.95 for the service.
FastAccess DSL Ultra, with speeds of up to 1.5 megabytes per second, will now cost $32.95 a month, down from as much as $44.95. And FastAccess DSL Lite, with speeds up to 256 kilobytes per second, will cost $24.95 a month.
In addition, BellSouth no longer is charging for service activation or shipping and handling fees. And it is cutting the price of its modems and gateways to $75 from $100 and $150, respectively.
Online orders for modems and gateways are free, after rebates.
BellSouth's Metcalf notes that some customers may not want to switch their pricing until the end of promotional offers, which in some cases cost $19.95 a month.
But the company's goal is to simplify its offerings and make clear the price comparison with cable rivals, he adds.
Time Warner Cable's Charlotte area division typically charges $44.95 a month for its Road Runner service, which features a download speed of five megabytes per second.
Time Warner offers a six-month introductory rate of $29.95 a month for new customers and it also discounts the price for customers who also buy cable telephone service
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