Tuesday, May 20, 2008

Ofcom Deregulates the UK's Wholesale Broadband Market

Ofcom , the official regulator and competition authority for the UK communications sector, announced the removal of regulations for wholesale broadband access in areas of the UK which are served by effective competition.

Ofcom said the regulatory environment it has put in place has resulted in significant competition which has matured at different rates across the UK. The most competitive areas tend to be those where there is high population density, in particular large towns and cities and business districts. Following a public consultation, Ofcom will deregulate almost 70 percent of the UK wholesale broadband market where there is now strong competition.

The measure will affect those parts of the country which are now served by four or more wholesale broadband providers and where no single company has significant market power. In these areas customers are protected by the disciplines of effective competition.

However, some parts of the country do not enjoy this level of competition. Where there is less competition and where a company still has significant market power, Ofcom will maintain regulation designed to promote retail competition. This requires BT and KCOM, in Hull , to provide a wholesale product to other providers on a fair and reasonable basis, thus allowing these providers to offer retail services.

"This is a major step forward in the UK broadband market reflecting the success we have had in promoting effective competition. It shows that we are determined to deregulate wherever we can do so in a way that is consistent with the broader public interest," said Ed Richards, Ofcom Chief Executive.http://www.ofcom.org.uk