Broadband customers face higher bills as Ofcom rules out price cap

Broadband customers face higher bills as Ofcom rules out price cap on BT’s new full-fibre network for a decade

  • Company is also spending £12billion on rolling out full-fibre broadband in UK  
  • Openreach will see no regulation or price caps on its new fibre services  
  • Increase in costs will encourage customers to switch and get new full-fibre  

Broadband customers are set to face higher bills as Ofcom lifted the price cap on BT’s new full-fibre network for a decade.   

The company is also spending £12billion on rolling out full-fibre broadband to 20million homes in the UK before the end of the decade.    

BT’s wholesale division, Openreach, will see no regulation or price caps on its new fibre services but will be able to increase prices on its older copper networks in line with inflation for the next 10 years.

The increase in costs on the older networks will encourage customers to switch to the new full-fibre services and the extra cash will go towards the rollout and get investors the returns they were expecting.  

The company is also spending £12billion on rolling out full-fibre broadband to 20million homes in the UK before the end of the decade

Clive Selley, Openreach chief, said: ‘We’ve now passed almost 4.5 million premises and are building faster, at lower cost and higher quality than anyone else in the UK.

‘Today’s regulation will allow us to ramp up to three million premises per year providing vital next generation connectivity for homes and business right across the UK.’

Ofcom said the approach will lead to properties in around 70 per cent of the UK having a choice of networks from competitive commercial rollout.

The Government plans to cover 20 per cent of the country through public funding to help ensure nobody gets left behind, the regulator added.

Openreach has said it will deploy full fibre to the remaining 10 per cent of homes, which are typically in rural areas and are unlikely to have access to competitors.

Dame Melanie Dawes, Ofcom chief executive, said: ‘Over the past year, being connected has never mattered more. But millions of homes are still using the copper lines that were first laid over 100 years ago.

BT’s wholesale division, Openreach, will see no regulation or price caps on its new fibre services but will be able to increase prices on its older copper networks in line with inflation for the next 10 years

‘Now it’s time to ramp up the rollout of better broadband across the UK. We’re playing our part – setting the right conditions for companies to step up and invest in the country’s full-fibre future.’

The plans were broadly welcomed by the industry as a step towards ensuring the UK’s broadband speeds improve without costing consumers more.

Lutz Schuler, Virgin Media chief executive, said: ‘Ofcom’s focus is in the right place, and we urge the regulator to maintain this trajectory so that more of the country can benefit from competing gigabit networks that deliver long-lasting economic, societal and environmental benefits.’

Greg Mesch, boss at CityFibre, said: ‘This regulation will promote and protect the infrastructure competition that is enabling Britain to go full speed ahead for full fibre.’

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