» ISP News » 
Sponsored Links

BT Escape Latest Ofcom UK FTTC Margin Squeeze Test Unscathed

Wednesday, Jul 29th, 2015 (10:26 am) - Score 842

The telecoms regulator has re-run its FTTC / VULA “margin squeeze” test, which was introduced earlier this year as a mechanism for keeping BT’s “fibre broadband” prices fair by ensuring they “maintain a sufficient margin between wholesale and retail … charges“, and found that the operator is not in breach.

The test imposes a new Significant Market Power requirement on BT to ensure they don’t “set the VULA margin such that it prevents an operator that has slightly higher costs than BT (or some other slight commercial drawback relative to BT) from being able to profitably match BT’s retail superfast broadband offers” (here and here).

Ofcom’s test weights a number of different factors, such as the price of the FTTC service and the impact of bundling value added features like free BTSport. The regulator is currently reviewing their approach (here), although in the meantime they’ve just completed another run using the latest data from BT and once again found that the operator is not in breach.

Ofcoms Statement

On 31 May 2015 BT submitted the data necessary for us to monitor BT’s compliance with SMP services condition 14 (Virtual Unbundled Local Access margin control) over the compliance period 1-30 April 2015.

At paragraph 1.15 of our statement “Fixed Access Market Reviews: Approach to the VULA margin” of 19 March 2015 we explained that following BT submitting its first compliance report, we would issue a statement that informs stakeholders whether or not we have reasonable grounds to suspect non-compliance over the first month assessment.

Having carried out a high level assessment, we have no reasonable grounds for believing that BT is contravening, or has contravened, SMP services condition 14 over the compliance period 1-30 April 2015.”

BT will no doubt feel as if the latest result adds further fuel to their belief that Ofcom’s test is “flawed” and merely provides “unwarranted regulatory protection” to their rivals (e.g. Sky Broadband and TalkTalk). The operator has already tabled an appeal against the measure with the Competition Appeals Tribunal (here).

By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook and .
Search ISP News
Search ISP Listings
Search ISP Reviews

Comments are closed

Cheap BIG ISPs for 100Mbps+
Community Fibre UK ISP Logo
Gift: None
Virgin Media UK ISP Logo
Virgin Media £26.00
Gift: None
Shell Energy UK ISP Logo
Shell Energy £26.99
Gift: None
Plusnet UK ISP Logo
Plusnet £27.99
Gift: None
Zen Internet UK ISP Logo
Zen Internet £28.00 - 35.00
Gift: None
Large Availability | View All
Cheapest ISPs for 100Mbps+
Gigaclear UK ISP Logo
Gigaclear £17.00
Gift: None
Community Fibre UK ISP Logo
Gift: None
YouFibre UK ISP Logo
YouFibre £19.99
Gift: None
BeFibre UK ISP Logo
BeFibre £21.00
Gift: £25 Love2Shop Card
Hey! Broadband UK ISP Logo
Gift: None
Large Availability | View All
The Top 15 Category Tags
  1. FTTP (5587)
  2. BT (3535)
  3. Politics (2556)
  4. Openreach (2313)
  5. Business (2288)
  6. Building Digital UK (2254)
  7. FTTC (2050)
  8. Mobile Broadband (1997)
  9. Statistics (1804)
  10. 4G (1685)
  11. Virgin Media (1640)
  12. Ofcom Regulation (1477)
  13. Fibre Optic (1408)
  14. Wireless Internet (1403)
  15. FTTH (1382)

Copyright © 1999 to Present - ISPreview.co.uk - All Rights Reserved - Terms , Privacy and Cookie Policy , Links , Website Rules , Contact