Ofcom unveils new wholesale price proposals for Openreach

30 Mar 2011

The UK telecoms regulator Ofcom has proposed a number of new regulatory controls that will apply to the pricing of wholesale broadband and fixed voice services offered by Openreach, the access division of fixed line incumbent BT. Charges for both local loop unbundling (LLU) and wholesale line rental (WLR) are covered by Ofcom’s proposals, and the watchdog claims that its recommended pricing structure ‘strikes a balance between providing incentives to invest in networks and ensuring that broadband and landline prices are good value for consumers.’

With regards to LLU, Ofcom says it plans to set individual charge controls for Metallic Path Facility (MPF) rental and Shared MPF (SMPF) rental, and separate baskets for MPF and SMPF ancillary services. It also notes that itaims to continue with a separate co-mingling basket for ancillary services used for both MPF and SMPF. Meanwhile, for WLR services the regulator has said that it expects to maintain the structure as applies in existing price control, in that control will apply to the Analogue Core WLR rental service (‘WLR rental’), and the charges for WLR New Connection and WLR Transfer. New controls for both LLU and WLR services would run until 31 March 2014.

Ofcom has said that it expects its proposals to lead to ‘real term price reductions for consumers, as communications providers pass on savings to their landline voice and broadband customers.’ A public consultation on the issue has now been launched, and interested parties have until 9 June 2011 to make their submissions.

United Kingdom, BT Group (incl. Openreach), Ofcom