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May 2, 2013

Ofcom to investigate BT wholesale fibre broadband pricing

Ofcom are to look into if BT have been abusing their dominant position with superfast broadband after a recent complaint from rival TalkTalk claimed they were building a monopoly and using their dominant position when setting prices for fibre optic broadband.

Ofcom, the UK telecoms regulator have launched the competition inquiry after they thought that there was reasonable suspicion that BT have been price fixing with it’s fibre broadband lines. The complaint last month from TalkTalk was for an investigation to be done into the wholesale prices that BT Openreach charge rival providers for using their network, they complained that “BT has failed to maintain a sufficient margin between its upstream costs and downstream prices, thereby operating an abusive margin squeeze.”

The prices charged to the 80 or so rival broadband providers who use the BT network are the same as BT Retail also pay and it has only been TalkTalk who have raised a complaint.

This was not the only beef that TalkTalk had with BT, they also questioned about the money the government are giving to BT under the BDUK scheme and saying that they are helping them create a monopoly.

A BT Spokesman said:
We are confident there is no case to answer. It would be better if the industry’s, and Ofcom’s, focus was on investing in the future of the country rather than on spurious actions designed to hold up fibre in the UK.

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