Line rental looks set to increase AGAIN as BT’s network arm Openreach raises the prices it charges to ISPs.
While these price rises don’t directly affect the consumer, increases in line rental are normally passed on to subscriber in some form.
Usually telecoms regulator Ofcom has a say by which how much Openreach can charge the ISPs which use its network – ISPs including Sky, TalkTalk, EE and BT’s retail arm, BT Broadband.
Ofcom’s regular Fixed Access Market Review normally sets the bar for prices rises, but delays has led to Openreach taking matters into its own hands.
Openreach says that its price rises are consistent with past advice from Ofcom and expects these rises to take effect from March 31, 2014 onwards and last until July 1. Nevertheless, Openreach says that it will reduce prices and reimburse ISPs if the regulator decides the rises are too high.
How exactly these prices will be passed on to the customer isn’t yet known. ISPs periodically increase the charge for line rental but are required to give customers ample notice.
Even if Openreach reduced its prices, it’s not a guarantee that retail customers would benefit. In March 2012, Ofcom decided that BT’s network division was charging ISPs too much and ordered it to cut the prices.
Openreach complied, but any possible savings made by the ISPs did not appear to be directly passed on to customers. Since then we’ve seen consistent rises in line rental prices.
Recently, Sky and Primus Saver have dropped the offer of line rental saver, a product which allowed customers to save a bit by paying for a year’s worth of line rental up front.
Although Primus Saver said that they dropped it because it wasn’t that popular, it removed the offer of saving around £45-£55 a year.
Line rental has to be paid in the majority of cases regardless of which ISP you get your broadband from. Virgin Media offers a Broadband Only service where there’s no extra charge for anything but internet access, but there’s no extras such as phone calls or TV thrown in.
Wireless ISPs and providers of satellite broadband don’t usually charge for line rental – as there’s no ‘line’ to rent as such – but you may have to pay extra if you want a VoIP phone service. Our guide to line rental explains line rental saver in more detail.