Back in August, Ofcom put forward a proposal to allow KCOM, the incumbent telecommunications provider in Hull, to offer Bundled products including broadband, telephone, calls and other services. Today, Ofcom has confirmed that it will allow the operator to sell these packages and expects KC, the retail arm, to start offering these by the end of the year.
The restrictions existed to help maintain a level playing field where the incumbent operator holds significant market power (SMP) in the provision of phone and broadband services. BT had the restrictions removed in September 2009, but at this time, KCOM was still seemed to hold SMP.
The change to BT's bundling effectively meant that consumers in Hull were being left behind and were not able to benefit from cheaper and more innovative products as seen in the rest of the country. Responses to the proposal from August showed concern that by allowing bundling, it will entrench KCOM in its market dominant position and delay any competitive entry into the market. Ofcom will therefore enforce some restrictions on KCOM which include:
One operator, MediaSat3, are already in the process of trying to obtain wholesale products in Hull which would allow it to offer competitive products to KC, although they indicated that they are having difficulty obtaining "true wholesale access" from KCOM.