Regulators have decided to try to ease the process by which BT will install a superfast broadband network.

The company's proposal to invest more than £1.5 billion in the scheme will be helped to become a reality by the removal of price control on internet access, reports the Financial Times.

Yesterday, Ofcom announced that it would allow the firm to set its own rates of investment return and would not impose price controls on fibre optic wholesale products.

This came after announcement by BT in July that it would only proceed with the plan if regulators allowed it to establish its own appropriate rate of return.

In reponse, Ofcom has decided to allow this and stated that the company could have total freedom to determine the tariffs for its broadband products.

BT said that it welcomed the move by the media and telecoms watchdog and commented: "The consultation does on the face of it look to be a step in the right direction."

The decision was particularly important to the UK's leading fixed-line phone company because some ministers believed that the competitiveness of the UK market could be damaged if BT did not start to invest in faster broadband.

Despite deciding to aid the firm through relaxing regulations, earlier this month Ofcom advised the government not to subsidise the installation of next-generation broadband throughout the country.

It is thought that this could cost a minimum of £5 billion but the most expensive option, in which homes are connected directly to the fibre optic system, could cost in the region of £28 billion.


Wednesday, 24th September 2008

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