BT Infinity quietly cuts usage... then loudly cuts prices

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Today, they claim to have slashed their prices to match, announcing a 'January sale' on those very same deals.

"We know that customers are looking to cut costs and are searching for great bargains to get the New Year off to a flying start," said Pete Oliver, managing director of BT Consumer.

The comparison is perhaps more apt than BT intended: like the 'original' price on the hanger, the new 'price cuts' on BT Infinity might be a good deal but they're also kind of a distortion.

The discount is actually an introductory offer - Infinity 1 is £7.50 a month for six months then £15 for the rest of the 18 month contract - and new customers in January will get less than a new customer earlier on in December would have done.

Pushing and pulling on fibre

From this fancy footwork we can deduce that BT are trying to pull households that currently regard fibre as unnecessary towards the superfast service.

A 20GB limit might seem mean spirited but it also sends a message that it's not only 'high usage' households that can benefit from faster internet.

In addition, by retaining a more expensive option - Unlimited Infinity - as their premium product BT might be able to push more households that would have otherwise gone for the 40GB usage allowance option towards paying more.

BT Infinity is available to 17 million UK premises, according to the group's November update but just 1.7 million households actually subscribe to the service.

Clearly there is room for BT to increase take up, and their own 5 million or so ADSL broadband subscribers seem like an obvious place to start.

Cutting usage as unlimited reigns

The decision to cut usage is doubly interesting, however, because the vast majority of UK fibre deals come with unlimited usage.

Virgin Media cable deals are all unlimited and of the mainstream providers using the BT FTTC network, BT, Sky, TalkTalk, Plusnet and EE, for example, only Plusnet offer deals with a data cap.

When we spoke to Plusnet last week, however, they told us they plan to stick with a 40GB monthly usage allowance.

We have "no current plans to change our broadband usage caps", a spokesperson said.

So BT, the provider best known for fibre, will be the only one offering the service with a 20GB usage cap, at least for the foreseeable future.

Many households, if they estimate usage, would likely find 20GB more than adequate but the peace of mind of unlimited, and lately even 'truly' unlimited without traffic management or a fair use policy (more), seems much more popular.

And cheaper unlimited, too

In addition to its popularity, the price of unlimited broadband - albeit on an ADSL line - has declined in the past few months.

In early December, Plusnet made their unlimited broadband £2.50 for the first year of the contract, although like BT that contract does last for 18 months.

Similarly, unlimited broadband from Tesco is currently 'free' for a year.

In that case, the catch is that customers have to take their line rental from the supermarket provider, though most broadband providers also require new customers to move their home phone line so that doesn't seem like a particular hardship.

All in all, some of the UK's cheapest broadband is now also unlimited broadband.

As ever, some of the very cheapest deals on the market do come with usage allowances (see our full guide for more) or with small print which means that they're not truly unlimited but, overall, we can say that the lowest prices are no longer synonymous with usage caps.

In this market, BT's bet that a smaller usage cap will signal greater value for customers thinking about switching over to fibre broadband, and that the unlimited usage on the more expensive deal will signal even greater value looks unlikely to pay off.