Ref: 38/01
Date: 4 May 2001

Following an investigation under the Competition Act, Oftel has concluded that BT’s two new tariff packages offering both voice and unmetered off-peak Internet access calls do not amount to a breach of the Act.

Oftel has therefore today closed its investigation into the pricing of the BT Surf Together and BT Talk & Surf Together tariffs.

Oftel had been concerned that the level at which BT had priced the ‘Surf’ element of BT Surf Together and BT Talk & Surf Together could have amounted to an abuse of a dominant position which is prohibited under the Act.

David Edmonds, Director General of Telecommunications said today:

"Oftel was concerned that BT had priced the ‘Surf’ element of BT Surf Together and BT Talk & Surf Together below cost. This could have had a material anti-competitive effect in Internet access markets, to the detriment of consumers.

"Although Oftel welcomes lower prices for consumers, Oftel had to ensure that these packages from BT would not undermine effective competition.

"After considering information submitted by BT, licensed operators and Internet service providers, Oftel has concluded that at the current prices the two packages do not have a material anti-competitive effect in Internet access markets.

"Consumers have access to a range of competing 24 hour unmetered Internet access products, which are a viable and sustainable alternative to the BT services.

"BT’s current pricing of the packages does not therefore constitute an infringement of the Competition Act. Oftel has closed its investigation."

Note to Editors

1. Copies of Oftel’s conclusions following the investigation are available on Oftel’s website at www.oftel.gov.uk/publications/internet/surf0501.htm Hard copies are available to the media from Oftel’s Press Office on 020-7634 8991 and to the public from the Research and Intelligence Unit on 020-7634 8761.

2. Oftel began its investigation into the pricing of BT's proposed BT Surf Together and BT Talk and Surf Together packages under the Competition Act 1998 on 27 November 2000. BT had previously notified Oftel of a number of price changes and new packages for residential customers that came into effect on 1 December 2000. These included packages offering unmetered voice and Internet access calls. The investigation under the Competition Act was limited to the pricing of the packages involving unmetered Internet access.