Ofcom pushes for broadband price cuts
11th Jul 2013 | 10:36
Wants to reduce BT Openreach wholesale prices
Ofcom has raised the prospect of cheaper landline and broadband tariffs with proposals to cut the wholesale prices charged by BT Openreach to other providers.
The communications regulator, which regulates prices because of BT's "significant market power", wants steady annual reductions against the consumer price index (CPI) between April 2014 and March 2017.
Prices on fully unbundled lines would come down by up to -6% against the CPI every year, with reductions of between CPI-8% and CPI-12% for shared unbundled lines, and between CPI-2% and CPI-8% for wholesale line rentals.
Ofcom said it expects that communications providers would pass on the reductions to customers, and that the cuts should provide incentives to invest in networks.
The proposals are open to consultation until September 25, following which Ofcom will look at what others have to say and make a final decision in the spring of next year.
Ofcom has also published a Wholesale Broadband Access Review, looking at competition in the market for wholesale broadband products. It's aiming to impose some regulations, including a charge control, on BT's services in the 10% of the UK where it has no effective competition.