Ofcom announces leased line consultation

Telecoms regulator Ofcom proposes regulation for 1Gbps connections but takes lighter approach to BT wholesale broadband pricing in London

Ofcom has revealed plans to regulate telecoms operators' leased line infrastructure across the UK, but is to consult for industry views.

The Business Connectivity Market Review looks at leased line infrastructure rented by numerous mobile, landline and internet operators, but mostly provided by telecoms heavyweight BT.  

Ofcom has proposed to extend its regulation of BT across the UK to ensure it provides access to other companies without discrimination and keeps its costing fair for leasing the lines. 

As well as BT, Ofcom will also begin regulating KCOM, which provides the infrastructure across Hull in East Yorkshire.

However the stepped-up regulation will focus on the faster connections becoming available from BT, namely lines topping the 1Gbps speed barrier, which Ofcom wants to regulate specifically.

It is not all strict news for BT though, as Ofcom confirmed it wanted to approach leased lines in London with a softer touch.

Ofcom claimed the higher level of competition from other providers in London meant BT didn’t have to face such strong regulations about pricing its leased lines.

Ofcom said this meant rules would be softer for its Ethernet services up to 1Gbps across London.

Despite announcing these plans, Ofcom hasn’t revealed its suggested pricing structure for BT, but has promised to publish this in coming weeks.

A statement from Ofcom said:  “The combined measures are designed to sustain competition and ensure the UK has a backbone of high speed business networks capable of supporting not only companies, but also consumer services that ultimately rely on these networks, such as superfast broadband and mobile video streaming.”

However, BT told Computer Weekly it was unhappy with the Business Connectivity Market Review and its proposals.

"The document is very long and contains a number of proposals, but from an initial review, we are disappointed that Ofcom has found that BT has market power in the very competitive high-bandwidth market and still intends to regulate declining legacy services,” a BT spokesman said.

“However, we welcome Ofcom's intention to simplify and add certainty to pricing in the business markets, as well as their recognition of greater competition in London. 

"We will continue to engage with Ofcom and other stakeholders throughout this consultation process."

The consultation will run up until the 24 August 2012. Ofcom plans to publish a statement of its conclusions early next year.


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