In the continual race to offer the cheapest broadband service available, ISP FreeUK has thrown down a gauntlet with its sub-£23 ADSL package.

At £22.99 a month, including Vat with a one-off installation fee of £58.75, it is now one of the cheapest packages on the market next to competitor Pipex, which charges £23.44 a month.

The average price for ADSL services however is £29.99, offered by BT, Freeserve and NTL.

A poll we ran at PC Advisor back in April revealed that a whopping 76 percent of the 3,563 people who responded thought £29.99 a month was too expensive.

But this isn't all BT's fault. BT's prices can only go so low before telco watchdog Oftel intervenes.

"If we get a lot complaints from ISPs that their competitors are undercutting them, charging completely uncompetitive prices then obviously we will investigate," said a spokesperson.

Both FreeUK and Pipex bundle a full ISP service for their fees, unlike BT's latest cheapo offering.

Pipex, a supporter of cheaper ADSL, has lashed out at BT over its 'no frills service' which costs £27 a month but strips out services such as email.

"At £27 a month this limited broadband service has been ridiculously overpriced and I believe they know it," said David Rickards, managing director at Pipex. " "In my opinion this is a blatant liberty-taking of their dominant market position."

BT said it believed prices were competitive, but refused to comment further.

"I believe these large residential ISPs are squeezing every last penny out of dial-up services at the expense of customers," added Rickards. The margins available with ADSL are workable and it is possible to offer a quality service at an affordable price while remaining profitable."

BT currently charges its wholesale customers around £15 a month for bandwidth.