Two down

18 March 2021 By Ed Cropley Follow @edwardcropley

Britain’s telecom watchdog won’t cap premium broadband prices for at least 10 years, giving the former monopoly more confidence over its 12 bln pound fibre rollout. A 5G spectrum auction also went its way. That sets up the next challenge: fixing its 9 bln pound pension deficit.

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Britain’s telecommunication regulator on March 18 laid out the terms under which former state communications monopoly BT can invest billions of pounds in rolling out a full-fibre nationwide broadband network.

Ofcom imposed price controls on BT’s basic fibre broadband offering, saying the operator could only increases prices in line with inflation. However, it said BT’s premium, faster broadband services would be free of any price caps until “at least 2031”.

BT said the regulations, taken as a whole, would allow it to earn a “fair return” on the 12 billion pounds it expects to spend connecting UK 20 million homes to fibre over the next seven years.

Rival Virgin Media, owned by Nasdaq-listed Liberty Global, described Ofcom’s approach as a “resounding sign of support and longer-term clarity” for digital infrastructure investors.

BT shares were down 3.1% at 148 pence by 0845 GMT on March 18.

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BT said the regulations, taken as a whole, would allow it to earn a “fair return” on the 12 billion pounds it expects to spend connecting UK 20 million homes to fibre over the next seven years.

Rival Virgin Media, owned by Nasdaq-listed Liberty Global, described Ofcom’s approach as a “resounding sign of support and longer-term clarity” for digital infrastructure investors.

BT shares were down 3.1% at 148 pence by 0845 GMT on March 18.

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