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BT facing Ofcom probe after Talktalk slams unfair broadband pricing

Watchdog to look into whether BT is abusing dominant position
Thu May 02 2013, 10:14
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UK TELECOMS REGULATOR Ofcom has said it will investigate BT's dominance in the broadband market following complaints from rival Talktalk.

Ofcom said it will launch an investigation to see whether BT is abusing its dominant position in the market when it comes to its broadband pricing, after competitor Talktalk moaned that BT is charging ISPs too much for access to its fibre-optic network.

Talktalk said that BT "failed to maintain a sufficient margin between its upstream costs and downstream prices," squeezing margins for competitors.

Ofcom is in the early stages of investigating BT, and said it will investigate the claims over the next few months before deciding whether there is a case.

The watchdog said, "In the initial phase of the investigation, we expect to gather further information using our powers under the Competition Act 1998, and to analyse this information. We expect this initial analysis to inform consideration of whether and how to proceed further with the investigation, during Autumn/Winter 2013."

Understandably, BT isn't pleased, and said that there's no case. A spokesperson said to The INQUIRER, "We're disappointed that Ofcom has opened this case despite the lack of any evidence and we're confident that there's no case to answer.

"It would be better if the industry's and Ofcom's focus was on investing in the future of the country rather than on spurious actions designed to hold up fibre in the UK."

Talktalk was happier with Ofcom's decision. A spokesperson said, "We have long maintained that there needs to be tighter regulation in superfast broadband to ensure a level playing field and therefore deliver real benefits for consumers and businesses.

"We are pleased that Ofcom is taking this matter seriously and have decided there are reasonable grounds to investigate BT's wholesale fibre pricing."

This isn't the first time that BT and Talktalk have come to verbal blows. In September 2011, Talktalk accused BT making a "lot of notice" about its broadband investment without doing anything of merit. µ

 

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