Oftel orders BT to cut wholesale unmetered Internet access charges

 Ref: 44/03
Date: 21 July 2003

Prices for unmetered Internet access for consumers should come down as a result of Oftel today ordering BT to reduce its charges for wholesale unmetered Internet access.

Following an investigation and proposals set out earlier this year, Oftel has concluded that BT has been charging operators for certain call routing and call management measures that are no longer necessary.

As a result, BT’s wholesale charge will be reduced by 17 per cent and backdated to June 2002, the date from when these additional measures were not needed.

When Oftel required BT to introduce a wholesale unmetered Internet access product, BT included a number of measures to support the new service. These were included in the charge to other operators.

David Edmonds, Director General of Telecommunications, said today:

"BT has made significant improvements to its network since wholesale unmetered Internet access was first introduced over three years ago.

"At that time, BT included several mechanisms to route Internet calls through to the appropriate service provider and call management measures to protect its network from being overloaded.

"BT’s network can now process Internet call traffic without these additional measures.

"As a result, I have today ordered BT to reduce its wholesale unmetered Internet access prices by 17 per cent.

"I have also required BT to backdate these reduced charges to June 2002, when BT upgraded its network.

"I hope that operators pass these savings onto their customers.

"The action taken today ensures that BT continue to recoup the cost of providing wholesale unmetered Internet access, and that UK consumers continue to benefit from one of the most competitive dial-up Internet markets in the world."

Notes to editors:

1. Direction on the Intelligent Network (IN) Charge for DLE and ST FRIACO has been published today by Oftel and is available on Oftel’s website at www.oftel.gov.uk/publications/internet/2003/friaco0703.htm. Hard copies are available to the media from the Press Office on 020 7634 8991 and to the public from the Research and Information Unit on 020 7634 8761.

2. Oftel published a draft Direction setting out its proposals on 4 April 2003 (see www.oftel.gov.uk/publications/internet/2003/friaco0403.htm.

3. This investigation was opened following a complaint from Cable & Wireless, which was later supported by Energis.

4. There has also been an adjustment to BT’s wholesale unmetered Internet access charges for the period 1 August 2001-31 May 2002. Oftel has ordered BT to reduce its wholesale prices for that period by around 6 per cent. The reason for this reduction is that it was not necessary to apply certain measures uniformly across all of BT’s local exchanges during that period.