Some 2,000 customers using Esat Fusion's unlimited usage Internet product "IOL No Limits" will be cut off within 31 days because the company has deemed them to be using the service too much.

Esat sent letters to selected customers - which it judged to be using the Internet "excessively" - last Friday and advised them their contracts would be terminated.

The company will continue to monitor the Internet use of its remaining 18,000 No Limits customers for overuse and may cancel the No limits product altogether.

One caller to The Irish Times said last night the withdrawal of service was an "absolute disgrace" as the product was advertised clearly as being without limits.

Mr Dereck Kickam, chief executive of Esat Fusion, said some users had not been in keeping with the spirit of the offer.

"We've had some customers who stay on the Internet permanently," he said. "We brought in a three-hour disconnection some months ago but people just typed in an automatic redial."

He said the customers who would be disconnected were chosen on the basis of overall usage. Customers who spent in excess of 75-100 hours a week would be affected, he added.

Esat recently stopped accepting new customers for the £20 (€25.40) per month unlimited evening service and is lobbying the telecoms regulator to force Eircom to offer a flat-rate interconnect fee.

The firm believes a flat-rate fee is crucial to enable it to offer a profitable unlimited service. But Eircom is opposing this and claims the unlimited Internet access model is unsustainable.

The withdrawal of No limits - the only flat-rate Internet access product in the Irish marketplace - is the latest setback for the Government's dream of an Internet society.

Recent surveys show the high cost of Internet access in the Republic is slowing the growth of Internet users and limiting the amount of time users connect to the Web.

Esat is not alone in withdrawing unlimited Internet products. The downturn in the telecoms market and regulatory difficulty has forced several UK operators to withdraw similar products.

It is understood several customers have threatened Esat with legal action over the withdrawal of service. However, Mr Kickam claimed the company was fully within its rights to cancel the contracts.