Friday, 31 March 2017 11:43

Ofcom seeks broadband investment

Written by  Ruralcity Media
Ofcom seeks broadband investment

Ofcom has announced measures it says will promote investment in new fibre broadband networks.

The telecoms watchdog says it wants to protect broadband customers and promote competition, by cutting the wholesale price that Openreach can charge telecoms companies for its superfast broadband service.

Ofcom says these savings would be passed on to residential customers through cheaper prices.

Doing so would promote competition in the superfast broadband service while companies construct their own full-fibre ultrafast networks to compete with Openreach.

The new rules would also include stricter requirements on Openreach to repair faults and install new broadband lines more quickly.

These will set higher binding quality standards on the company's performance. Should Openreach fail to meet the new targets, Ofcom has the power to impose fines.

Ofcom director Jonathan Oxley said: "Our plans are designed to encourage long-term investment in future ultrafast, full-fibre networks, while promoting competition and protecting consumers.

"People need reliable phone and broadband services more than ever. We're making sure the market is delivering the best possible services for homes and business across the UK."

The Ofcom announcement was described as interesting by Dan Howdle, consumer telecoms analyst at broadband advice site Cable.co.uk.

By capping the wholesale price and ensuring cuts were passed on to consumers, average household telecoms bills could drop substantially across the next three years, he said.

"Investment in these faster technologies will be positively encouraged," he said.

Ultrafast connections would take on the role of premium service and become the somewhat more expensive option for consumers who wish to be at the cutting edge.

"Ofcom is also tightening up the rules when it comes to fixing faults," said Mr Howdle. "Taken together, these moves are very interesting.

"Both appear to push Openreach further toward the role of public service, and further away from being the profitable concern of a single provider."

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