This move is an entirely expected response to Sky's initiative, announced earlier this month.

Now that the cost of hardware has been removed, consumers will have the chance to make a direct comparison between the content and services offered by the two digital providers. We relish this prospect.

We are confident that viewers will see the advantages of Sky digital which offers much more choice and better value, with over 150 channels and services available today and many more, including the interactive service Open, over the coming months. In addition we offer 40% off standard BT rates for all telephone calls, and free access to the internet, with the lowest round-the-clock on-line charges.

This move is good news for the digital television market in general, and for consumers who now face no barrier to going digital.