Watchdog proposes price controls for BT's high-speed business lines

Reuters News
Posted: Jun 12, 2015 2:43 AM

LONDON (Reuters) - Britain's telecoms regulator Ofcom proposed controlling the prices BT can charge for some of its high-speed business lines, following up on a review which recognized the former state monopoly's "significant" market power.

Ofcom said it was opening a consultation on the level of those price controls which would apply to some of BT's wholesale leased line prices, and result in price cuts for customers in the 2 billion pound ($3.10 billion) market.

Amongst the business customers using the leased lines are consumer mobile and broadband operators as well as companies, schools, universities and libraries.

"Ofcom is proposing a form of charge control that aims to bring prices down to costs over a three-year period. This type of control, which is linked to inflation based on the consumer price index, provides an incentive for BT to make efficiency gains," the regulator said in a statement on Friday.

Ofcom said the consultation would close at the end of July and it expected to publish its decision in the first quarter of next year.

The consultation is also considering how to price the opening up of BT's network to other operators, a move which it hopes will improve competition in the high-speed data link market.

Broadband companies TalkTalk, Sky, business telecoms providers COLT and GTC, and mobile operators Vodafone, 3 and EE, said last year they wanted business lines opened up.

($1 = 0.6454 pounds)

(Reporting by Sarah Young. Editing by Jane Merriman)