Why won't you copper-ate? Openreach offers capped fibre line rental to wholesalers in bid to shift all that FTTP

Nation's broadband plumber increasingly desperate to ditch its copper network

In an attempt to pull costly support from its copper network, Openreach has agreed to cap wholesale costs for providers who stop selling copper-based broadband products in areas where FTTP is available.

The announcement has come as Openreach moves forward with the removal of its legacy copper and PSTN-based fixed-line products. In March, the BT-owned infrastructure provider said it aims to decommission the copper network by 2026, with analogue PSTN services discontinued by 2025.

Wholesale ISP customers can opt-in to Openreach’s offer between October 1, 2021 and March 30, 2022, with costs capped for ten years, albeit with an annual adjustment for inflation.

According to Openreach’s proposed pricing list, line rental for a gigabit connection (1000 Mbps down, 115 Mbps up) will start at £22, adjusted annually by the CPI inflation rate minus 1.25 per cent or zero, whichever is higher.

At the bottom of the scale, line rental for an entry-level connection (55/10Mbps or 80/20Mbps) will start at £14.75. Price inflation will be in proportion to that of 40/10Mbps packages, where Ofcom has instituted a £13.93 price cap in order to ensure affordability for low-income households.

These figures may not actually be the real sums charged to ISPs, as Openreach said it may offer rebates for high volume customers. This would give providers even more incentive to push FTTP upgrades to the public.

Openreach has set the connection fee at a flat £99.39, except for households in regions in Ofcom’s Area 2, which is described as a “potentially competitive area.” Here, Openreach said it will charge £25 for a connection that’s new to the network, or £50 otherwise.

Nice bit of irony for the copper flingers

In March, Ofcom published its review of the wholesale Telecom market, where it declined to institute any price controls on wholesale FTTP connections for the immediate future. Why? In order to give Openreach a fair shot at recouping its capital costs.

And yet here it is, introducing its own price caps.

It's a clear signal that Openreach is eager to discontinue the copper network, as it would dramatically reduce its operational expenses, and free up more staff to maintain the new fibre network.

While it has the power to introduce stop-sell orders, these are largely at the pleasure of Ofcom. This move primarily circumvents that oversight by shifting the decision-making to the market. Openreach's hope will be that it gives a financial incentive to customers by offering a degree of price stability, as well as the possibility to reduce the stated line rental costs by selling at scale.

Openreach has said it aims to extend FTTP coverage to 26 million premises by 2026. In April, the company raised its deployment plans following the introduction of a “superdeduction” that allowed it to write-off 130 per cent of its capital costs. As a result, the company will pay minimal tax for the next few years. ®

Broader topics

Narrower topics

Other stories you might like

  • US, UK, Western Europe fail to hit top 50 cheapest broadband list
    Syria, Sudan, Belarus, Ukraine came top. Are you starting to see a pattern?

    In an analysis of 3,356 fixed-line broadband deals in 220 countries, price comparison website Cable.co.uk found that the UK has the 92nd cheapest internet, beating the US, which came in 134th place.

    Based on 41 packages, the average cost per month for broadband in Britain came in at $39.01. Stateside, this rose to $55, from 34 packages measured.

    For these bulwarks of western democracy, 92nd and 134th place isn't particularly impressive. But if you really want to shave the dollars off your internet bill, you have a number of options.

    Continue reading
  • The right to repairable broadband befits a supposedly critical utility
    A bolt of lightning has caused me days of misery, because the fix requires too much proprietary tech

    Column I heard an electric discharge, a bit like a Jacob's ladder, immediately before a deafening crack of thunder. I'd never been so close to a lightning strike! All of the lights in the house went bright, then dimmed, then went back to normal. "Uh-oh," I thought, "I'm in trouble now." Everything in the house had been hit by a nasty surge and the oft-spoken aphorism that broadband services are now a utility to rank with water and electricity was suddenly very, very, real to me.

    But it was electricity I worried about first. I use top of the line surge protectors so my most sensitive devices – computers and monitors, of which I have many – all seemed fine. But I'd overlooked two other connections that come into nearly every home: the antenna and the phone line.

    My television seemed to have taken a direct hit. It still worked – mostly – but appeared unable to receive any digital broadcasts. That circuit, lying on the other side of the antenna lead, likely took a big hit from the lightning strike. But the rest of the television seemed fine – at first. After a few days, and several spontaneous reboots, I began to intuit that devices don't always immediately fail when hit by lightning. Sometimes they gradually shed their functions and utility.

    Continue reading
  • Telecoms growth forecast for 2022 may be optimistic
    Analyst view: 4Q21 drop plus strains from war mean component shortages drag on

    The telecoms kit market had a good 2021 with revenues close to $100bn, up more than 20 percent since 2017, but growth is now slowing, according to analyst Dell'Oro Group. Huawei is also starting to feel the effect of sanctions, but still leads the global market by a fair margin.

    However, the Dell'Oro Group's prediction of slightly less growth for 2022 may turn out to be optimistic amid warnings that the Ukraine war is already having an impact on the fragile supply chain recovery.

    Dell'Oro's analysis is based on the telecoms market sectors it monitors, including Broadband Access, Microwave & Optical Transport, Mobile Core Network (MCN), Radio Access Network (RAN), and Service Provider Router & Switch.

    Continue reading
  • Fibre broadband uptake in UK lags behind OECD countries
    Not very 'world-beating'

    Optical-fibre internet now makes up 32 per cent of fixed broadband subscriptions across the OECD countries, and is the fastest growing broadband technology. However, there is a mixed picture with cable still dominant in the Americas and the UK still predominantly DSL.

    These figures come from an update to the OECD's broadband portal, indicating that fibre subscriptions grew by 15 per cent across the OECD countries between June 2020 and June 2021, with demand for faster internet speeds as employees worked remotely due to COVID-19 restrictions cited as one reason.

    Fixed broadband subscriptions in OECD countries totalled 462.5 million as of June 2021, up from 443 million a year earlier, while mobile broadband subscriptions totalled 1.67 billion, up from 1.57 billion a year earlier.

    Continue reading

Biting the hand that feeds IT © 1998–2022