Ofcom to lower broadband costs

Michael Bow
Follow Michael
THE COST of broadband is set to fall after regulators ordered a review into the price BT charges others providers to rent out the copper wire lines used to connect homes and businesses to the web.

Ofcom, the UK communication regulator, said it wants to revise charging structures for BT’s Openreach network access division.

The division is the wholesale network that underpins the amount third party providers can charge for broadband and line rental.

Ofcom, which regulates the network prices, wants to cut prices for companies every year between 2014 and 2017.

The regulator said it hoped the reduction in wholesale prices for third party broadband and telephone providers, such as Sky, Virgin and Talk Talk, would get passed onto consumers.

“These proposals are complex and we will review them in depth. There are a number of areas where we believe Ofcom have not fully recognised the costs of providing services,” BT said in a statement.

The cost of wholesale line rental for telephone services to each customer is £93.27 every year.

Unbundling telephone and internet lines and letting BT provide the telephone service means third parties pay £9.75 a year, purely for the broadband line. Taking control of both internet and telephone lines costs providers £84.26 a year. Costs are set to fall up to 12 per cent a year until 2017 for the rental of single broadband lines. Wholesale line rental will fall up to six per cent.