Oftel to force lower broadband prices

A day after the government's e-Envoy called for lower broadband prices, Oftel has ordered British Telecommunications to cut the rates it charges to companies using its infrastructure to provide high-speed Internet services.

The ultimatum could mean less expensive broadband connections for UK consumers and businesses, stimulating demand and jump-starting broadband takeup. The government and high-tech businesses have identified broadband as key to the UK's continued competitiveness in the high-tech sector.

Oftel director general David Edmonds said that BT's charges are too high, even as BT is considering raising broadband charges to customers. BT owns the infrastructure for providing telecoms and broadband services, making it difficult for other companies to compete, and efforts to give competitors direct access to telephone infrastructure have stalled.

Oftel's demand will mean that BT must give competitors cheaper access to parts of the telecoms infrastructure, allowing them to pass along lower prices to consumers. ADSL, the broadband technology that runs over phone lines, also faces competition from cable television companies, who pipe high-speed access through cable lines.

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