Ofcom forces Openreach to lower broadband wholesale prices

The proposed rules will have prices slashed every year until 2020/21

Ofcom is demanding Opennreach lower its wholesale prices to broadband providers in a move to protect customers from higher prices.

The regulatory body will propose measures to BT’s infrastructure arm, Openreach, to control what it can charge providers for its fibre broadband service.

Ofcom is hoping with the measures prices for fibre broadband could be slashed for millions of customers in the UK.

Under the new rules Openreach’s price for 40Mbit/second broadband would fall from £88.80 per year to £66.28 next year and £52.77 by 2020.

Ofcom said in a statement: “We would expect much of this reduction to be passed through by retail providers to their customers, resulting in lower bills.”

However, prices for even faster broadband will not be capped, in the hope that operators will be spurred to install their own lines in competition with Openreach.

Other rules force Openreach to complete 93 per cent fault repairs within two working days, a rise from the current 80 per cent. Openreach will also have to install 95 per cent of connections on the agreed date, an increase from 90 per cent currently.

BT was fined a record £42 million by Ofcom on Monday due to delays by Openreach in installing fibre lines.

Ofcom competition group director Jonathan Oxley 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”.

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