BT tussles with Ofcom over wholesale pricing

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BT tussles with Ofcom over wholesale pricing

Microscope contributor

Ofcom has granted BT Openreach the right to raise the wholesale prices that it charges other operators for LLU line rental by just over 6% to £86.40 for a fully unbundled line, but BT has claimed the rise doesn’t go far enough.

“Ofcom has taken a tentative step towards rebalancing the market but that step is insufficient and creates real disincentives for future investment. It was previously agreed that Openreach would be allowed to fully recover its costs and that is all we are asking for,” BT said in a statement circulated to the media

The rise is at the low-end of the price range announced by Ofcom late last year, when it said prices could go over £90, and there can be no denying that given the disastrous results BT posted earlier in the month, it could have used the extra cash.

BT also believes it has grounds for complaint given the price rises are also the first it has been allowed to implement since Openreach, which owns and manages BT’s copper network, was formed in 2006, and therefore do not account for inflation over the past three years.

The telco also insinuated that investment in its 21CNnext-generation network would suffer.

Ofcom chief executive Ed Richards insisted that the new pricing would “enable Openreach to make a fair return whilst allowing continued strong consumer take-up of broadband at competitive prices.”

Ofcom claims there are now nearly 6 million unbundled lines active in the UK.


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