Rivals raise eyebrows over BT’s Openreach price cuts
BT’s Openreach has said it plans to offer cheaper rates to its wholesale clients like Sky and TalkTalk as it tries to push Brits from copper to full fibre.
The move will benefit big internet providers that do not have their own fibre networks, but has raised eyebrows amongst the firm’s biggest rivals.
The main argument is that plans from BT’s networking division could price out smaller firms.
“BT is facing the biggest competitive challenge in its history with billions of pounds of fibre investment pouring into the UK, creating the prospect of genuine broadband wholesale competition at scale for the first time,” VMO2 chief Lutz Schüler said.
“To avoid putting planned and future investment at risk, and to safeguard fair competition, it’s vital that these wholesale pricing proposals are thoroughly scrutinised to ensure Openreach is not using its market power and dominance to lock in providers and deter them from switching to other networks.”
VMO2 and CityFibre have been on a mission to lay fibre in order to nab some of Openreach’s customers.
Altnet provider CityFibre sent a complaint to the Competition and Markets Authority last week.
“BT Openreach is exhibiting a series of behaviours straight out of the playbook of a dominant operator using its market power and advantages to maintain its dominance,” said Greg Mesch, chief executive of CityFibre.
Under wholesale fixed telecoms market review rules, Openreach must notify Ofcom of certain offers 90 days before they come into effect.
This allows the watchdog, as well as the wider industry, to assess the offer and potentially intervene.
Ofcom said it expects to publish a consultation on its provisional view by early February and stakeholders will have 30 days to respond.
Chief Commercial Officer at Openreach Katie Milligan said: “We’re investing £15bn to upgrade the UK to ultrafast, ultra-reliable Full Fibre broadband and we’re keen to get more homes and businesses using this new network as soon as we’ve built. That way the whole country will benefit.
“To that end, we’ve responded to our customers’ desire for lower prices and long-term certainty. These offers don’t commit them to Openreach exclusively but, alongside our new, faster speed tiers, we’re confident they’ll help them continue to support and delight their own customers in a highly competitive market.”