Broadband News

BT landline only customers to get £7 windfall in April 2018

There are some 1.5 million landlines in the UK where people do not have broadband too and Ofcom has got BT to agree to reduce the price of its standalone landline service to from £18.99 per month to £11.99 which returns the cost to around what people paid in 2009.

This reduction will benefit around 1 million customers, and Ofcom is apparently expecting the other operators to follow suit for its standalone customers, i.e. the pressure to retain those half million customers will see them reducing their retail price. As far as we can tell there is no reduction in the wholesale pricing, so once competitors to BT have done their maths it may be they will lower the pricing for existing customers but stop chasing new landline only customers, with the effect that BT may become the defacto provider for landline only services over time.

We had wondered what would happen to those people who have BT line rental but broadband via another provider and the Ofcom news is pretty clear today that the price cut does not apply to you. What will happen though is that BT is meant to help those customers take advantage of bundles to lower their overall price paid out for fixed line broadband and phone. While moving to a bundle is cheaper for some there are combinations particularly for home workers where you cannot get the same services in a bundle currently. Our guess then is that the result is that those paying BT line rental and have broadband with another operator will get more promotional material for BT bundles, we cannot envisage BT Consumer agreeing to the promote bundles from other operators.

To avoid this reduction in line rental being clawed back in a couple of years a price cap is to be put in place, with the increase limited to the rate of inflation.

Two thirds of the those affected are in the over 65 age bracket and three quarters have never switched providers and with many more services moving to online by default the price jump from a simple line rental service to a broadband with fixed line package will now seem a larger gap to bridge in terms of the price people will be required to pay. Therefore there is a possibility that the move today will cement this ratio for those not taking broadband until in many years a generation who has only known the internet since their teenage years are the retired generation.

Comments

Line rental is over priced anyway. but why only people who do not have broadband? Line rental is line rental and at the end of the day we pay extra for broadband. I know providers use the excuse that the high line rental means broadband is cheaper,but that is a load of cobblers to be honest.
Also, why just BT? i am sure that some people are on other providers and have line rental only and no broadband.

  • zyborg47
  • 29 days ago

Given that the going rate today for line rental only for people who shop around is £13 per month they will only be undercutting by £1. The issue is similar to the arguments about gas and electricity - those who don't shop around and find the best deal for their circumstances get shafted!

  • jelv
  • 29 days ago

No one paying £7 on post office or Pulse8 will care. which is good for them :)

  • ZenUser27
  • 29 days ago

Who is paying £7/month to Post Office for line rental? That is a loss leader is people are, their retail price is £15 (offer) with standard price at £16.99 per month.

  • andrew
  • thinkbroadband staff
  • 29 days ago

So if you have FTTP with another provider because you prefer them, and they don't do landline services, (note, FTTP via a fibre optic line, not FTTC or ADSL via the phone line), you would still have to pay £19 for landline only with BT? It still leaves the problem of not being able to shop around for the best deal for two unrelated products, bundling is anti-competitive.

  • csimon
  • 29 days ago

Pulse8 is £13 and their call rates are only 1p per minute billed to the second with no call connection fee. Unless you make a LOT of calls it's a no brainer!

  • jelv
  • 29 days ago

@csimon If you have a data only FTTP line (eg FTTPoD) then I see no reason why you cannot get a bt copper line at the new lower price.

  • baby_frogmella
  • 29 days ago

@baby_frogmella: Yes, that seems sensible, perhaps the article is misleading when it says "people who have BT line rental but broadband via another provider, the Ofcom news is pretty clear today that the price cut does not apply to you". Perhaps it should say copper-based broadband? Can it be clarified whether pure fibre BB with another provider excludes you from the lower BT copper price?

@jelv: Thanks, I'd never actually heard of Pulse8. I was looking around about 6 mths ago for a low-use landline-only product,the only reasonably-priced one was from SSE (£13.50). It's no longer offered.

  • csimon
  • 29 days ago

PS. This article says too that BB with another provider excludes you from this price. https://www.moneysavingexpert.com/news/phones/2017/10/bt-to-cut-landline-costs-for-almost-one-million-customers

It's as though BT/Ofcom is saying that your landline isn't your only lifeline if you have any form of broadband, as though it's as easy when you're having a heart attack to get up and go to your computer, log onto Facebook and post a message for help rather than reaching for your phone and dialling 999...

  • csimon
  • 29 days ago

Ofcom wording on the phone+broadband

"Ofcom also wants to help people who buy a telephone service from one provider and broadband from another.

While the price cut will not apply to this group, the agreement requires BT to help these customers to take advantage of the deals on offer in the market, by explaining that they could get a better deal if they purchased services as part of a bundle."

No mention of copper or FTTP. So interpreted as it was written.

  • andrew
  • thinkbroadband staff
  • 29 days ago

It's about time providers stopped using line rental fee's to cover the 'true' cost of broadband, Ofcom need to throw down a ruling to make all providers do the same billing adjustments together to lower risk of customer losses to providers.

Let's be honest that's why such changes haven't gone through yet.

If the Broadband is worth £30 don't charge £20 for it but then inflate Line Rental costs... and better still OR need to get naked VDSL launched and customers need the choice of the requirement for a phone line or not (ok... doesn't help ADSL customers but start somewhere)

  • mlmclaren
  • 29 days ago

Pensioners obviously have better lobbying powers than rural folk. No sign of rural folk getting reductions in price for receiving a tiny fraction of the 'up to' speeds advertised.

  • camieabz
  • 29 days ago

How does the cost of providing telephony compare to the cost of providing the line and other components that are shared by the broadband service? Whenever line rental is discussed, there are numerous comments by naive people (not so much her, but on news sites) who think that if broadband is £20/month and line rental £18, that they should be able to ditch the landline and pay just £20. Clearly most of the costs are still incurred in providing the line for broadband. The additional cost of a voice call service must be negligible. The issue is how the pricing is apportioned.

  • jrawle
  • 29 days ago

@jrawle the wholesale cost of a "phone" line is significantly less - I think it is about £8 a month or thereabouts. There are then costs for the operator to provide support and services. Call costs should be covered by charges on a per call basis. Largely the phone line rental appears to have been a way for providers to increase charges whilst maintaining headline low charges for broadband. If the phone line rental was bought down to £11.99 for all then what would happen is the broadband charge would go up by £7 - so for those with packages it would make no overall difference.

  • ian72
  • 29 days ago

@jrawle - Just to clarify I do agree with your statement, however I understand where people come from, the need for the line to and from the exchange/cab is fair and should be charged for 'appropriately' however people don't link being told that they 'must' have something they don't want.

What also isn't helped is when the media run stories telling the public how much the retail cost of line rental actually is....

CONTINUED...

  • mlmclaren
  • 29 days ago


Regardless of providers providing a working telephone service people don't use fixed telephone line anymore and having bill's telling them they are paying £19 for something they don't use/want/need

The faster that naked DSL comes about the better.

  • mlmclaren
  • 29 days ago

This is madness. There should be one line rental price. They should carry on selling broadband at x including £11.99 line rental instead of y including £18.99 line rental. If x and y are the same, so be it.

  • kasg
  • 29 days ago

@camiebaz "No sign of rural folk getting reductions in price for receiving a tiny fraction of the 'up to' speeds advertised." Nor do I see any sign of rural folk being asked to pay higher costs to reflect the increased costs for the provision and maintenance of their lines.

  • MCM999
  • 29 days ago

@MCM999 - +1 ;)

  • mlmclaren
  • 29 days ago

@thinkbroadband I wouldn’t class £7 as a windfall

  • @neitherspanish
  • comment via twitter
  • 29 days ago

@MCM999 actually rural broadband does tend to cost more. For example, Plusnet charges £7 per month extra in a market A area, while cheaper ISPs such as Sky, TalkTalk, Vodaphone, Virgin, won't provide a service at all.

  • sheephouse
  • 28 days ago

Does Ofcom do enough to regulate the cost of line rental to end users in general terms I think not, wholesale prices to SPs haven't increased that much in the last five years have they?

  • 21again
  • 28 days ago

If - and it's a big if - "naked" VDSL could dispense with the need to take a pair back to the exchange, then would make sense to offer it at a reduced price. But I bet all the automatic pair testing kit is in the exchange, so you can't do that. Anyone in the know care to confirm ?
I make no comment as to how useful that test equipment is...

  • mpellatt
  • 28 days ago

@sheephouse "actually rural broadband does tend to cost more" as maybe however this article is about landline rather than broadband costs and no supplier to my knowledge differentiates their landline costs between rural and urban despite the much higher costs involved in supplying rural and remote locations.

  • MCM999
  • 28 days ago

Any effect for those of us with partial LLU (IE. only BB unbundled)?

  • MrBeeline
  • 25 days ago

@MrBeeline No

  • andrew
  • thinkbroadband staff
  • 25 days ago

As a FTTC customer of BT I have been surprised recently to find that I could lose my landline telephone service for two days due to a fault without an obvious effect on my broadband service. In fact, my broadband speed increased after the landline service was restored by an Openreach engineer but I do not know if this was directly connected to his work.

  • bsg017
  • 25 days ago

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