AT&T quietly offers $10 DSL plan

updated 8:02 a.m. ET June 19, 2007

NEW YORK - Without any sort of fanfare, AT&T Inc. has started offering a broadband Internet service for $10 a month, cheaper than any advertised plan.

The DSL, or digital subscriber line, plan introduced Saturday is part of the concessions made by AT&T to the Federal Communications Commission to get its $86 billion acquisition of BellSouth Corp. approved last December.

The $10 offer is available to customers in the 22-state AT&T service region, which includes former BellSouth areas, who have never had AT&T or BellSouth broadband, spokesman Michael Coe confirmed Monday. Local phone service and a one-year contract are required. The modem is free.

The plan was not mentioned in a Friday news release about AT&T's DSL plans, and is slightly hidden on the AT&T Web site. A page describing DSL options doesn't mention it, but clicking a link for "Term contract plans" reveals it. It's also presented to customers who go into the application process, Coe said.

The service provides download speeds of up to 768 kilobits per second and upload speeds of up to 128 kbps, matching the speeds of the cheapest advertised AT&T plan, which costs $19.95 per month in the nine-state former BellSouth area and $14.99 in the 13 states covered by AT&T before the acquisition.

BellSouth generally had higher prices for DSL before it was acquired, and the price difference persists, though AT&T did cut the price of the cheapest advertised plan in the Southeast region by $5 from $24.95 on Saturday.

The agreement with the FCC required the company to offer the plan for at least 2 1/2 years. Coe said he could not comment on future advertising plans for the offer.

The introduction of the plan, slightly before the deadline at the end of June, was first reported by The Tennessean in Nashville.

Another concession to the FCC is yet to come: a plan for DSL that doesn't require local phone service. AT&T has another six months to introduce that option, which should cost at most $19.95 per month.

Consumer advocates have fought for this so-called "naked DSL plan," because DSL can carry Internet-based phone calls for less than the price of local phone service. However, at 768 kbps, the download speed may be too low to appeal to the relatively sophisticated customers who use the Internet for phone calls.

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