Ofcom proposes to block new Openreach commercial offer to protect fair competition and keep long-term prices low
Ofcom has today launched a consultation on its provisional views on a set of commercial offers that Openreach intends to introduce.
As Openreach has significant market power, it must give Ofcom and the wider industry advance notice before introducing certain types of commercial offers.
Openreach’s offers
In June, Openreach notified Ofcom of its intention to roll out a range of offers, including:
- ‘Incremental New to Openreach Offer’. This offer gives Internet Service Providers (ISPs) a monthly discount for bringing new full-fibre customers onto Openreach’s network. It applies only to new customers above an ISP’s normal number of new sign-ups. The discount could be very substantial – up to £9.50 per customer for up to 30 months.
- ‘Geographic Incremental New to Openreach Offer’. In areas where Virgin Media operates, this offer provides a one-off £50 discount on new full-fibre customers to Openreach, above the usual number of an ISP’s new sign-ups. Altnets also have significant presence in some of the areas covered by this offer.
- ‘Frontbook ARPU Share Offer’. When a household wants a higher-speed broadband package, they’ll typically pay more to their provider, who in turn will also pay more to Openreach. This offer will cap what an ISP pays on average for new high-speed connections at £19.32 per month. In practice it would make getting people onto higher speed packages more commercially attractive to ISPs.
Alongside these, Openreach also plans other offers, including specifically for high-capacity business connections.
I am one of the editors here at www.systemtek.co.uk I am a UK based technology professional, with an interest in computer security and telecoms.