Ofcom Praises Competitive UK Broadband Market

Ofcom says the level of competition in the UK broadband market has reached a new milestone, with the number of ‘unbundled’ lines in the country reaching nine million.

Unbundled lines are copper telephone lines are owned by BT, but are used by other telecoms providers to offer broadband and other services. BT has been required to open its copper circuits up to rival providers at a fair price for some years, and Ofcom says this has promoted competition and resulted in lower Internet bills for consumers.

The nine million lines represent a 70-fold increase since 2005, when there were just 123,000 unbundled lines in the UK, meaning that the majority of Brits could not access a range of services. Although BT was told to unbundle in 1999, initial progress was very slow, until the formation of OpenReach, the infrastructure division which serves BT and other services providers.

Since 2005, the average cost of a broadband service delivered over a copper telephone has dropped from £23.60 a month (excluding VAT) to £13.11.

Fibre competition

Ofcom has also claimed that competition is improving in the fibre broadband market as rollout increases. BT makes its fibre network available to other providers through BT Openreach and there are now 80 providers other than BT Retail offering superfast broadband services of 30Mbps or above.

BT’s fibre network now covers 15 million premises, with 100,000 added each week, and Virgin Media serves another two million. In November 2012, 13 percent of all residential broadband connections were superfast, more than double the 5 percent of homes the previous year.

Ofcom has recently begun a new review of the fixed access market to ensure an appropriate regulatory framework for the future, something that will likely be welcomed by TalkTalk, which has called for superfast broadband regulation in order to preserve competition in the sector.

TalkTalk CEO Dido Harding said that it was worrying that the majority of consumers received superfast broadband from BT Retail and Virgin Media and has said that competition in fibre is not as strong as it is in copper.

BT has so far won all of the government funding available under the Broadband Delivery UK scheme, which aims to bring fibre to areas where it would otherwise not be commercially viable. The company is likely to secure all the remaining money after Fujitsu withdrew from the procurement process last month.

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