By Alex Scroxton
5 December 2008
Comms regulator Ofcom has given BT Openreach the green light
to hike its wholesale prices for broadband providers running their services
over BT infrastructure.
BT originally agreed a pricing structure back in 2006 in an
agreement that led to the creation of the Openreach group, but the prices
agreed have remained static ever since because the agreement did not make provision
for inflation or changes to other costs, Ofcom said in a statement.
Ofcom said the price increases would promote competition in
provision of voice and broadband services, as well as making sure that BT had
the proper incentives to continue investing in broadband services.
The biggest changes are likely to come on fully-unbundled
services, such as those operated by Carphone Warehouse’s TalkTalk ISP brand,
where BT now has licence to charge 11% more up to a maximum £91 for one year’s
rental.
An Openreach spokesman said: “BT invests more than anyone in
the UK’s
communications infrastructure and so it is critical that it is able to achieve
a fair rate of return on its investment.
“From a quick read we are encouraged by the direction of
this paper but we have issues with some of the underlying assumptions being
used. We will be raising these with Ofcom given this is just the latest stage
in a long running review.”
Meanwhile, Ofcom has also launched a new code of practice committing
ISPs to improve the information they give to customers about broadband speeds.
