Ofcom seeks cheaper broadband by increasing competition with lower wholesale prices

UK telecoms regulator Ofcom hopes new wholesale price cuts for superfast broadband services will lead to cheaper access for consumers.

The regulator will improve the wholesale pricing of high-speed services from national broadband network Openreach. New technology investments from BT, such as G.Fast, will not be capped at this point as Ofcom believes the caps elsewhere should be sufficient to protect competition and protect consumers from higher 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.”

“People need reliable phone and broadband services more than ever. We’re making sure the market is delivering the best possible services for homes and business across the UK.”

The new charges for the ‘40/10’ Mbit/s broadband package from Openreach will be reduced from £88.80 per year to £52.77 in 2020/21. The regulator expects much of the savings from the reduction to be passed on to customers due to competition.

Telecom providers are entitled to compensation if notified within eight days

Alongside the new wholesale pricing of their broadband services, Openreach will also be subject to stricter requirements when it comes to repairing faults and installing new lines.

Ofcom wants to shorten the lead time for an installation appointment to ten working days by 2020 and set the level of appointment availability to 90 percent over the review period

While late installations by Openreach only affect five to seven percent of total orders, Ofcom notes this still affects a considerable number of customers given the volume of WLR, MPF and GEA-FTTC installation orders being placed by telecoms providers. Openreach has committed to a 50 percent reduction in missed appointments (both for install and repairs.)

In cases where connections are not working, telecom providers are entitled to compensation if notified within eight days and the fault was due to Openreach. Ofcom notes these occurrences have remained at a low rate for some time and will not be imposing regulatory standards for performance in this area.

The complete requirements for Openreach in regards to repairing faults and installing new lines is available here (PDF) and the new measures form part of Ofcom’s Wholesale Local Access Market Review for the period from April 2018 to March 2021. The consultations close on 9 June 2017, and Ofcom expects to publish its final decisions in early 2018, with new rules taking effect on 1 April 2018.

What are your thoughts on the new regulatory measures? Let us know in the comments.

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