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BT Openreach Cuts Ethernet Backhaul Prices

Posted: 24th Nov, 2008 By: MarkJ
BT's Openreach division, which is responsible for ensuring that all rival operators have equality of access to BT's local network, has announced a range of price reductions that should make it up to 65% cheaper for ISPs to invest in higher speed backhaul bandwidth:

Effective immediately for new and existing connection orders, and from the 1st February 2009 for rentals, the price reductions will encompass most of Openreach’s WES, WEES and BES products. Changes include:

  • BES 1Gb product connection reduced by up to 62% and rental by up to 31%.

  • WES/WEES 100Mb Local Access reduced to the same price as 10Mb Local Access for both connection and rental, representing a reduction of up to 43% for connection and up to 14% for rental.

  • BES 100Mb reduced to the same price as BES 10Mb for connection and rental, representing a reduction of up to 65% for connection and up to 26% for rental.
Openreach strongly believes that these price reductions will play a key part in enabling the communications industry to meet the demands for higher bandwidth from end users in the fixed and mobile broadband markets, as well as business connectivity.

Backhaul Ethernet networks are typically used to link local access network and business LANs to a telecommunications operator’s core network. Lowering the cost for these could, especially for some larger providers, cause end-user services to become cheaper or more flexible:

Steve Robertson, CEO of Openreach said: “For our key Broadband suppliers this means the opportunity to buy super-fast gigabit capacity at drastically reduced prices and the chance to enhance their own network capacity with minimal incremental investment.

In addition Communication Providers will soon be able to purchase ten times the capacity they buy today for more or less the same price, allowing business customers to massively improve their connectivity at a fraction of the cost, and providing a boost for UK competitiveness in an uncertain economic climate.
”

However it is important not to overestimate the difference this could make because bandwidth itself can still be a costly commodity, one that is most difficult to grapple with.
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