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Ofcom allows easing of rules on IPstream in parts of UK
Friday 05 December 2008 10:36:48 by Andrew Ferguson

BT Wholesale has a had a two tier approach to its BT IPStream product pricing for a while, and with Ofcom now granting a variation in undertaking as asked for by BT, there is wider scope for the prices of IPStream products to vary across the country.

Ofcom has effectively divided the UK into a number of market areas based on the amount of competition in the area. The definitions were covered back in our news during November 2007. The area that Ofcom has granted the variation in is Market 3, which is defined as those areas with 4 or more principal operators and the exchange serves more than 10,000 premises. Market 3 covers 69.2% of UK premises.

The full document detailing the variation and comments from interested parties during the consultation period can be found on www.ofcom.org.uk, but be warned it is a 30 page document that is not a light read.

The proposal, while affecting IPStream now, covers the 21CN WBC product range also, which while available is still relatively low volume due to low coverage and the small number of providers (believed to be 8) supplying it. The freedom in pricing means it is impossible to know what BT Wholesale will do, it may try and take on the competition from LLU providers and reduce prices, or it may decide that those remaining with them in Market 3 will remain even if prices are raised slightly, and this may then be used to fund new product roll-out such as the fibre products, or simply subsidise the costs for providing broadband to the remaining 4000 or so telephone exchanges.

One interesting aspect is that the removal of the rules means BT Wholesale in the Market 3 area could release a product for a single provider, so if BT Retail or anyone else for that matter wanted a new Video over Broadband product that maybe had servers closer to the consumer, reducing network costs or ideally in the exchanges BT Wholesale can work on and release this without any requirement to offer the product on the same basis to all other providers.

Comments

Posted by adslmax over 8 years ago
what does it leave my exchange as a 'market 2' ??
Posted by andrew (Favicon staff member) over 8 years ago
Business as usual on Market 1 and 2, i.e. rules apply as per now.

But it could mean we see products in Market 3 that are not released in Market 1 & 2 potentially.
Posted by CARPETBURN over 8 years ago
The way i read this nothing is going to change anyway, atleast when it comes to a consumer choosing... Those that dont have several services at their exchange will still have the limited choice they have now and those that have several services at their exchange will still pick based on price and available real life speed. Thats the way i see it anyway
Posted by Dawn_Falcon over 8 years ago
You mean BT might actually be able to offer a service where the terms are not government-set? Right. They need a proper USO and the freedom to impliment it.
Posted by chrysalis over 8 years ago
the question is could this allow BTw to revert to the original ipstream system which had expensive ports and cheaper traffic?
Posted by andrew (Favicon staff member) over 8 years ago
It would allow a return to standard pricing only if the BT Central were to terminate only people in the Market 3 area.

Different matter for WBC.
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