"Growth in internet access, coupled with some of the lowest prices in Europe is excellent news, " said David Edmonds, Oftel's Director General of Telecommunications.

BBC: NEWS | Technology | Speed 'tempts dial-up net users'

David Edmonds, head of telecommunications watchdog Oftel, said on Wednesday he had taken "at face value" Altavista's announcement in March that it would give web-users access to the internet at a flat rate.

BBC: Watchdog 'taken in' by Altavista

"The action taken today ensures that BT continues to recoup the cost of providing wholesale internet access, and that UK consumers continue to benefit from one of the world's most competitive dial-up internet access markets in the world, " said Oftel director general David Edmonds.

BBC: BT told to cut internet charges