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BBC business editor Robert Peston said Carphone Warehouse, owner of the TalkTalk broadband and phone offering, was paying £370m for the operation.
The UK's largest residential internet provider is currently NTL, which has 2.9 million home customers, followed by BT on 2.2 million.
Carphone Warehouse is now in third place.
[edited by: Moff at 12:31 pm (utc) on Oct. 11, 2006]
AOL UK has 2.1 million customers across the country - 600,000 on dial-up and 1.5 million with broadband connections.
It was also on the news:
News of the deal came after Carphone Warehouse said strong demand for its existing TalkTalk broadband offer meant it was costing £20m more than originally expected.
Also, since AOL stands for America On Line (or Online), I find it quite funny that they call it AOL UK. It doesn't make sense - or is it just me?