TalkTalk’s chief executive Dido Harding has called for Ofcom to begin regulation on the rental fee paid by ISPs to BT who want to launch fibre-based broadband services on BT’s new cable network.
The price of fibre line rental paid to BT is £6.90 per fibre line on top of the £7.64 which an ISP is already paying for copper ADSL lines. Currently, Ofcom regulates the prices BT Openreach charges for copper ADSL but the new fibre lines are at present free from regulation.
Speaking to the Guardian, Harding warns that BT’s shiny new fibre network will be a ghost town unless competition can be regulated and stimulated:
“We need to get a move on otherwise the country will have spent a lot of money building infrastructure which no one is using,” said Harding. “We must start a consultation this year on the regulatory framework structure once build-out is complete.”
Harding, who seems to be in favour of the UK Government’s internet safety proposals, wants new regulation in place by 2015, the time by which BT aims to have two-thirds of the UK connected to its new network, a project in which it has invested some £2.5 billion.
BT has countered TalkTalk’s calls for regulation saying that it will need 12 to 14 years tro recoup investment in its fibre network at the current rate.
BT: “Our fibre wholesale prices are very reasonable”
“We believe our wholesale prices are very reasonable given how expensive it is to deploy fibre,” BT said. “We are taking a long term approach and this is helping to keep prices down so that consumers will be encouraged to take up the service. Every ISP pays the same for fibre and that helps to sustain a competitive market.”
TalkTalk has so far only connected around 5,000 customers to superfast broadband. By contrast, BT signed up 400,000 subscribers to BT Infinity services, with 95,000 added in the last three months.
Compared to Virgin Media this is a little way off; latest figures show that over 4 million subscribers are using its fibre network, with 843,000 of those using ‘superfast’ speeds of 30Mbps or above.
Virgin Media’s fibre optic network currently serves around 55 per cent of the UK right now; BT’s network will eventually see around two thirds (or 66 per cent) able to sign up for its BT Infinity fibre services. Virgin Media has of yet not approached the idea of wholesaling its own fibre network.
Recombu Digital recently compared the top tier 100Mbps services of BT and Virgin Media; while BT Infinity 100 stands to give customers a speed boost of up to 300Mbps in a year’s time, it’s available to less customers than Virgin Media 100 is.
Update: the figures above were updated to reflect the number of Virgin Media customers connected to 30Mbps+ services.