BT unhappy with new Openreach pricing
Ofcom has released new price controls on BT Openreach this morning which define how the division can charge for access to the local loop including MPF (metallic path facility) and SMPF (shared metallic path facility) services. MPF is used by LLU providers who offer both an unbundled telephony service as well as broadband, and SMPF is where the provider only provides unbundled broadband. WLR (wholesale line rental) charges are to stay at their current rates until the conclusion of the Wholesale Narrowband Market Review, following a recommendation from the European Commission. BT are free to implement the price changes 28 days from today.
|Current Price||Proposed Price in second consultation||Price for 2009/10||Indexation in 2010/11|
|MPF||£81.69||£85 to £91||£86.40||RPI +5.5%|
|SMPF||£15.60||£15.60 to £16.20||£15.60||RPI +1.0%|
BT have expressed distate to the changes particularly as there hasn't been any inflationary increase since the prices were set in November 2005 and December 2004 for MPF and SMPF respectively.
"Ofcom has taken a tentative step towards rebalancing the market but that step is insufficient and creates real disincentives for future investment. It was previously agreed that Openreach would be allowed to fully recover its costs and that is all we are asking for.”BT Statement
The price increases being at the lower end of the range is obviously a bonus for LLU providers whose costs will not rise that significantly. The full details of the changes are available from Ofcom.