BT given regulatory freedom on super-fast broadband

BT was given a boost today when Ofcom said it would not intervene in the wholesale pricing the telecom leader can set for super-fast broadband products.

The regulator said telecoms providers such as BT would be free to price wholesale super-fast broadband products themselves without any regulatory intervention, to earn a rate of return that reflects the associated costs and risk.

Ofcom said today that pricing freedom would promote investment in next-generation broadband networks, which deliver speeds of up to 10 times today's broadband offering and allow households access to a variety of high-bandwidth services.

BT welcomed the clarity of Ofcom's policy.

"Today's announcement gives us the green light to push ahead with our £1.5bn superfast broadband investment plans to reach at least 40 per cent of UK households by 2012," Chief Executive Ian Livingston said in a statement.

"Today's announcement from Ofcom has set expectations for the whole UK industry as the market evolves into a fibre-based world."

It said BT's Openreach division would have to offer fibre-based broadband services to other providers, including BT Retail, on equal terms and without favour.

"Super-fast broadband represents one of the most important developments in modern communications for many decades," said Ed Richards, Ofcom chief executive, in a statement today.

"Our message today is clear: there are no regulatory barriers in the way of investment in super-fast broadband; we want to promote investment but also ensure that there is fair and effective competition for the future."

A number of companies have announced plans to roll out super fast broadband in the UK, including Virgin Media, which already offers the service on its cable network, and BT, which plans to upgrade its copper access network.