Broadband is increasingly central to the lives of UK consumers and the success of businesses.
It allows consumers to access and interact with a wide range of content and services and allows businesses to exploit new market opportunities and more efficient operating models. Competition has driven the success of the current generation of broadband services. The result has been greater choice, innovation, lower prices and high levels of broadband adoption.
In the Review of the wholesale broadband access markets - Statement on market definition, market power determination and remedies' ("the 2010 WBA Statement") (PDF, 1.3 MB) published on 3 December 2010, we found there is effective competition in areas covering almost 80% of the premises in the UK. However, in Market 1 - made up of exchange areas in which BT is currently the only provider of wholesale broadband services - we decided that BT1 should be subject to a charge control. On 20 January 2011, we set out our proposals on the structure, form and level for the charge control in the WBA Market 1 areas (the "January Consultation") and requested stakeholders' views on these.
This statement sets out our conclusions on the charge control for Wholesale Broadband Access (WBA) services in Market 1. We set out below our conclusions following consideration of the responses to the January Consultation.
We believe that the benefit of the wholesale charge reductions resulting from this charge control could deliver lower retail prices and also improve broadband users' experience in Market 1. As average demand increases as more consumers seek to use higher bandwidth services, we believe that internet service providers (ISPs) will reflect the benefits arising from the charge control in better quality of service, as this is likely to be an important focal point for broadband retail competition in Market 1 areas.
1. Our decision on the WBA charge control is addressed to BT plc. as a whole. It should be noted that however that the charge controlled product is supplied by BT Wholesale ("BTW").