The prime minister Tony Blair's vision of an "internet for the people" is turning out to be a mirage.
In March this year Mr Blair hailed plans by the US internet firm AltaVista to offer unlimited online access for a one-off payment of around £30 and a small annual fee.
"Our goal must be to see prices comparable with anywhere in the world," Mr Blair said, fearing the UK's "new economy" would lag behind unless call charges were cut to allow affordable web access.
But since then a series of unmetered services have been launched and have sunk, their founders realising that their plans were not economic. As a result, the government's aspirations of extending internet access beyond wealthy and educated sectors of society remain a long way off.
Richard Branson's Virgin Net recently announced a delay in its flat fee, unlimited access service, while this week CallNet 0800 - the first UK company to offer unmetered access - announced that it was scrapping the service on September 5 and replacing it with standard pay per minute charges for surfing the net.
Even AltaVista - which received a blizzard of publicity for its plans, including front page news in the Sun and the Daily Mail - appears to have struggled to make its unmetered service work.
Tim Richardson, internet editor of The Register, a specialist information technology website, said the ambitious plans of internet service providers such as AltaVista had not benefited ordinary users.
"AltaVista has yet to provide any evidence that it is providing unmetered internet access for the 120,000 users it claims to have," Mr Richardson said.
The company originally said it had received more than 1m inquiries from potential customers since its announcement, and planned to add 90,000 new users each month.
But yesterday an AltaVista spokesman said the company was "not prepared to say" how many active users it had.
The firm may make a statement next week, but fears in the industry are that AltaVista is running into technological and access worries that have plagued other internet service providers.
CallNet this week told its customers that it blamed "substantial changes in the telecommunications industry", which it said had "altered the fundamental economics" of its unmetered service. Another operator, Breathe, was recently forced to bar 500 customers for using its unmetered service too much.
But many in the sector blame BT for dragging its feet on reducing call charges for internet service providers. "Many of them had higher hopes for wholesale access from BT," said one analyst.
"It's very hard to build a business plan for unmetered access when you are paying per minute to BT."
Negotiations are still going on between BT and other telecommunications companies over wholesale packages that would inject new life into flat-fee internet access for home users. But it may be several months before a deal is signed.
Earlier this year BT came under fire from the chancellor, Gordon Brown, when he demanded that the company open up its local network to cheaper, faster suppliers.
Net losses
AltaVista
Announced unmetered annual flat-fee internet service in March, launched on June 30, but yet to get off the ground
CallNet 0800
Launched unmetered net access at the end of 1999, will scrap the service in September and return to metered access
Breathe
Kicked 500 users off its unmetered service for overuse
Virgin Net
Announced delay in the launch of its £15 a month flat-fee service
LineOne
Axing unmetered 24/7 net access service at the end of next month
Liberty Surf
U-turn on unmetered net access offer
