BT given go-ahead to increase charge to rivals
After months and months of discussions, OFCOM has today set out a new system which will see British Telecom allowed to increase its charge to competitors using its network by up to 11%. Not only is this a serious development for BT but it will also allow the industry, and BT in particular, to invest in the long-awaited national broadband fibre-optic network. This was the main reason for BT's insistence upon a price increase although this has been refuted by many of its competitors.
British Telecom is planning to spend tens of billions of pounds over the next few years on the introduction of a UK wide fibre-optic network which will increase broadband speeds substantially. This has the potential to push the UK back towards the higher tier of the worldwide broadband sector which has left the UK behind in recent times. But who will pay for the increased charges?
The potential increase in charges could signal the end of cheap broadband services in the UK with providers forced to increase their own charges to cover the BT change. While the move should not happen immediately, there are suggestions that in 2009 we will see a reduction in the number of introductory offers and special rates for broadband users.
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