Ref: 12/02
Date: 26 February 2002

Commenting on BT’s proposed reduction in its wholesale broadband prices, David Edmonds Director General of Telecommunications said today:

"Today’s announcement has the potential to bring about a step change in the take-up of broadband by consumers and small businesses.

"The cost of broadband is clearly an important factor in take-up and the price reductions proposed are very significant.

"I welcome the fact that BT believes it can reduce its costs and pass these savings on through lower charges to service providers.

"Service providers have the opportunity to take real advantage of these proposed price reductions.

"Reduced wholesale charges should enable service providers to offer broadband access to consumers at significantly lower prices, which could drive mass take up of high speed services.

"Clearly any prices charged by BT must be fair and not anti-competitive. BT is well aware of that and has already provided Oftel with cost information.

"We are examining that information as a matter of urgency. But it already appeared from information that was provided to Oftel earlier that there was likely to be scope for a significant reduction in BT's wholesale prices."

Note to Editors

Oftel has recently been carrying out an investigation into BT’s existing wholesale prices as a result of a complaint from another operator. BT have provided further information on their cost base in the last few days and Oftel should shortly be able to ascertain the cost basis of BT’s wholesale prices and reach a decision on whether these prices restrict competition or not.