1:25pm UK, Tuesday July 18, 2006

BSkyB is joining the broadband race with plans to offer its own service.

The owner of Sky News is investing £400m over the next three years into the project and says it expects to see an improvement in earnings from 2010.

180 James Rupert Murdoch broadband logo launch

Murdoch in broadband move

It is looking to get back around 15% of the capital spent on the venture by 2011.

Sky, 38% owned by media giant News Corp, is headed by James Murdoch.

Sky will offer its customers free broadband with up to 2 megabits per second download speed whatever TV package they take.

It will throw in a free wireless router which allows users to connect to the Internet anywhere in their house without the need for a network of wires.

"The business case is clear," Chief Executive James Murdoch said in a statement.

"We believe our investment will enhance top-line growth, be earnings enhancing from 2010 and deliver increasingly attractive returns thereafter."

The broadband package, which follows its acquisition of Internet service provider Easynet last year, comes as media and telecoms firms invade each other's territories and bundle multiple services to woo consumers.