Ofcom has today published initial plans on how to make it easier and cheaper for companies to build ultrafast, ‘full-fibre’ broadband networks directly to UK homes and offices using BT’s existing telegraph poles and ‘ducts’ – the small, underground tunnels that carry telecoms cables.
In July, Ofcom detailed a new strategy to promote large-scale roll-out of ultrafast broadband, based on cable and fibre lines that go all the way to people’s doorsteps. This would provide an alternative to the mostly copper-based technologies currently being planned by BT, and deliver benefits to people and businesses in terms of choice, innovation and affordable prices.
Ofcom believes network competition is the most effective spur for continued investment in high quality, fibre networks. This will also reduce the country’s reliance on Openreach, the network division of BT.
Other countries have seen this approach, called duct and pole access, used to extend fibre to people’s doorsteps. In Spain and Portugal, the resulting competition has helped deliver full-fibre broadband coverage of 79% and 70% respectively. This compares to around 2% currently in the UK. More detail about this work is available here.
Landline prices review to protect elderly and vulnerable
Last week, Ofcom also announced a review of the price of standalone landline phone services, to ensure that customers receive value for money. Overall competition in the telecoms sector remains strong, with consumers getting better value for money in recent years, but Ofcom is concerned that people who buy landline services on their own – not in a bundle of services with broadband or TV – are not being served well by the market, and are most acutely affected by price rises.
Ofcom analysis shows that all major landline companies have increased their line rental charges significantly in recent years – by between 28% and 41% in real terms – despite them benefitting from around a 25% fall in the underlying wholesale cost of providing the service.
Our research also shows that elderly and vulnerable people, who make up a significant proportion of standalone landline customers in the UK, are particularly affected by price rises. They are often very reliant on their landline, and more likely than most to have stayed with the same phone company all their life.
Ofcom’s review will establish whether measures are needed to protect this group of customers. We are now analysing the market in detail and, depending on our findings, we expect to consult in early 2017. More detail about this work is available here.