Ofcom pushes BT to reduce Openreach charges
While Virgin Media reports early completion of superfast broadband rollout
By Anh Nguyen | Computerworld UK | Published: 09:22, 07 February 2012
Ofcom has proposed new charge limits that will reduce BT Openreach's wholesale rental prices.
The telecoms watchdog regulates prices charged by BT's wholesale access division because Openreach has been found to have significant power in the market for these services.
In its proposal to the European Commission, Ofcom has suggested lower prices for a fully unbundled line to a property, a shared unbundled line to a property and for wholesale line rental.
Related Articles on Techworld
The annual rent charge for a fully unbundled line, where a communications provider takes over the line to provide broadband and telephone services, will fall 4.5 percent from £91.50 to £87.41 in 2012/13, and fall further in the next year at a Retail Price Index (RPI) rate of -5.9 percent.
The wholesale line rental price, for communication providers to offer telephone services to consumers using lines rented from Openreach, will also fall by a similar rate, from £103.68 to £98.81 in 2012/13. The price will decrease further the following year at an RPI rate of -7.3 percent.
The highest reduction will be in the cost of a shared unbundled line, where a communication provider uses part of the line only for broadband provision.
Under Ofcom's plans, the wholesale price for this will fall by 18.9 percent, from £14.70 a year to £11.92 in 2012/13. It will fall further the next year according to the RPI rate of -15.9 percent.
Ofcom's previous charge controls expired on 31 March 2011. Since then, Openreach has been pricing its services according to a voluntary commitment, which expires at the end of this March.
The watchdog expects the new charge controls to take effect on 1 April 2012.
Separately, fibre broadband operator Virgin Media has said that it has completed the rollout of superfast broadband to the UK months ahead of the original mid-2012 deadline.
Superfast broadband is now available to 10 million of the UK's 26 million homes, the company said.
Virgin Media recently announced its aim to double access speeds for most of its customers, and to boost its top speed of 100Mbps by a fifth to 120Mbps.
