Ofcom proposes to deregulate wholesale broadband markets

Ofcom has launched a consultation process on the UK’s wholesale broadband access market.

The consultation divides the UK into four areas -

• the Hull area, where Kingston Communications is the only operator;
• Market 1 area, where BT is the only operator;
• Market 2 area, where there are 2 or 3 principal operators and
• Market 3 area, where there are currently 4 or more principal operators and where there are forecast to be 4 or more Principal Operators but where the exchange serves 10,000 or more premises.

Ofcom is proposing that regulatory obligations should be removed in areas of strong competition, while maintaining consumer protection in areas where there is limited broadband provision.

Currently, around 80% of consumers can choose between two or more wholesale providers, while 65% can choose between 4 or more. In some areas there are 8 wholesale broadband providers.

According to Ofcom, the Hull area and markets 1 and 2 would benefit from further competition and regulations will require Kingstom Communications and BT to open up their networks.

Ofcom plans to remove the regulations imposed on BT in Market 3, where consumers can already choose between several providers.

Consultation into the proposals closes on 7th February 2008.