Ofcom has drafted new rules meant to speed up the roll-out of full-fibre broadband and halve the upfront costs of laying ultraspeed cables across the country.
The communications regulator will force BT’s Openreach to open its existing telegraph poles and underground tunnels to rivals hoping to lay cables in areas that might otherwise require digging works.
It means fibre could be installed in some streets in a matter of hours, while the upfront costs could be slashed by up to 50% from around £500 per home to £250.
Ofcom said it is also working to protect consumers against high prices, particularly in rural areas where competition may be scarce, cutting the wholesale price that Openreach can charge telecoms companies for its entry-level superfast broadband to £11.92 per month – which is slightly higher than a cap of £11.23 proposed before a consultation last year.
BT’s Openreach will be forced to open up telegraph poles and tunnels to rivals as part of Ofcom’s new measures (PA)
However, Ofcom has stopped short of capping the cost of the fastest wholesale superfast broadband products offered by Openreach, which it said was an incentive for rivals to build their own full-fibre networks.
But to prevent BT from “stifling new investment”, it will not be allowed to make targeted wholesale price cuts in areas where rivals are starting to build their own networks.
Ofcom said its plans could mean bolstering full fibre coverage across the UK from 3% today to 20% by 2020.
Ofcom competition director Jonathan Oxley laid out the business case for the regulator’s decision.
“Ultrafast speeds will allow people to download entire films, or businesses to share huge files, almost instantly. Full fibre will also underpin exciting technology like remote healthcare diagnostics, 5G mobile and connected devices.
“The measures we’ve set out today will support the growing number of companies who have already announced plans to build full-fibre networks, and open the way for even more ambitious investment around the UK.”
The draft measures have been submitted to the European Commission for comment, though that will be followed by a final statement on the decision by Ofcom next month.
TalkTalk cheered the move, saying: “Ofcom’s strong decision is good news for consumers, competition and investment.
“We have long argued that Openreach has no incentive to invest in the full fibre broadband that Britain needs when it could make excess profits by overcharging for copper-based services.
“Ofcom’s move not only protects customers in today’s market, but also ensures Openreach and others are encouraged to invest in the full fibre networks of tomorrow.”