Ofcom approves BT Openreach pricehike

Ofcom approves BT Openreach pricehike

December 5, 2016

BT has been granted permission by telecoms regulator Ofcom to charge its rivals up to 11% more for using its network services.

The news follows Ofcom’s announcement in May that it would be re-examining the prices that BT’s Openreach division is allowed to charge rival companies for wholesale access to local exchanges.

The biggest increase is for fully unbundled lines, whereby a rival company takes over a BT line to provide broadband and telephone services.

From April 1st, BT will be able to charge up to £91 per year for this service, an increase of 11% compared to the current maximum of £81.69.

On average, the price of renting a fully unbundled line is expected to increase by 50p per month.

For shared unbundled lines, where a rival shares a line with BT to provide broadband only, the maximum BT is allowed to charge will increase 4%, from £15.60 to £16.20.

Ofcom said the price changes were chosen to maintain fair competition in the voice and broadband sectors whilst giving BT incentive to continue delivering the services its customers require.

BT has denounced the increases as insufficient because they do not even cover the cost of inflation since Openreach was set up in 2006.

It is not yet clear whether Ofcom will allow Openreach customers, such as Carphone Warehouse and BSkyB, to pass on the price increases to subscribers.

Tim Yeo

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