Openreach (BT) has reportedly re-launched talks with a number of major UK broadband ISPs (e.g. TalkTalk, Vodafone) on developing long-term discounted wholesale deals for their Fiber-to-service. Gigabit-enabled the-Premises (FTTP), which were suspended last year after rivals like Virgin Media raised competition concerns.

We know that Openreach has been planning further discounts to help drive adoption of its FTTP product since early 2020 (here). Major ISPs, such as Sky Broadband and TalkTalk, also have a vested interest in being able to offer consumers the most affordable FTTP broadband plans possible, which is needed to tackle growing competition from a new generation of alternative network providers. affordable (AltNet) (eg Cityfibre, Hyperoptique).

NOTE: BT plans to invest £ 12bn to help Openreach roll out FTTP to 20m UK premises by the mid to late 2020s (here) – 4.5m has already been made. Virgin Media is also talking about adding 8 million more homes in the UK via FTTP (here).

The operator has already made limited discounts, but the news would have potentially been more significant, especially for those that could encourage adoption of the faster levels. But some rival operators (eg Virgin Media) were concerned that this would make it harder for alternative networks to compete with the established giant and could even be anti-competitive, given Ofcom’s earlier rules (here).

Towards the end of last year, Openreach, as reported via TalkTalk (here), appeared to put this plan on hold pending the results of Ofcom’s latest market review. At the time, a spokesperson for Openreach told ISPreview.co.uk that they had a “legal obligation to treat all our customers equally and we take this obligation very seriously. This means that our full fiber products will still be available to all UK ISPs at the same price point.. “

Since then, Ofcom has finally published its latest Wholesale Fixed Telecommunications Market Review 2021-2026 (here), which extended an existing ban on offering certain “geographic discounts»To include full fiber services. But that doesn’t completely preclude all discounts (they have more freedom in competitive areas – Zone 1), and it also gave Openreach some certainty about the different approaches they could potentially take.

the Telegraph (paywall) are now reporting that Openreach has reignited discussions about the possible introduction of long-term wholesale discounts for FTTP with a number of ISPs including TalkTalk and Vodafone etc. TalkTalk CEO, Tristia harrison, said she was delighted to be “work constructively“With the operator on a”reasonable price structureagain. Such a deal, if agreed, could also help allay some of TalkTalk’s concerns about recent price increases on legacy copper-based services (here).

Ofcom will no doubt be looking to take a look at any future proposals and hopefully, if Openreach does introduce anything, it won’t leave small ISPs on their platform too disadvantaged against the competition. Meanwhile, consumers in competitive areas (mostly dense cities) will undoubtedly appreciate the prospect of cheaper FTTP plans offered by providers.

At the same time, we must not forget that Openreach must also balance all this with the need to make a return on its investment. Finding the right balance between subscription and affordable prices can be a difficult thing to find. A price that is too low can push the payback window of their investment even further into the future.