Ofcom moves to cut superfast broadband prices

Ofcom moves to cut superfast broadband prices

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Ofcom moves to cut superfast broadband prices

  • 31 March 2017
  • From the section Business

Engineer working on broadband connectionsImage copyright
BT

Households could see the price of superfast broadband fall under plans by the UK telecoms regulator.

Ofcom is proposing to cut the price that BT’s infrastructure arm, Openreach, can charge operators for its popular superfast broadband service.

The regulator said it would expect these savings to be passed on to consumers through cheaper bills.

It is also planning new rules for Openreach to fix and install lines more quickly.

Openreach operates the wires and cables that power the UK’s broadband network, leasing out the lines to BT’s rivals such as Sky and Talk Talk.

Under the regulator’s plans, Openreach’s price for 40 Mbit/second broadband would fall from £88.80 a year to £66.28 next year and £52.77 by 2020.

“We would expect much of this reduction to be passed through by retail providers to their customers, resulting in lower bills,” Ofcom said.

But it will not cap prices for even faster broadband, hoping that this will spur operators to install their own lines in competition with Openreach.

‘Protect prices’

Jonathan Oxley, Ofcom’s competition group director, said: “Our plans are designed to encourage long-term investment in future ultrafast, full-fibre networks, while promoting competition and protecting consumers from high prices.”

Other rules would force Openreach to complete 93% of fault repairs within two working days, compared with 80% currently.

Openreach would also need to install 95% of connections on the date agreed with the telecoms operator, up from 90% today.

BT was issued with a record fine of £42m by Ofcom on Monday because of delays by Openreach in installing high-speed lines.

Ofcom has forced BT to legally separate Openreach into a distinct business, in another move aimed at boosting competition.

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