• The UK regulator has blocked Openreach from introducing a discounted wholesale fibre access pricing plan
• This marks the first time Ofcom has intervened since a March review
• Altnets and industry rivals welcome decision but some warn of further consequences

UK telecom regulator Ofcom has blocked Openreach, the quasi-autonomous fixed access network division of BT Group, from launching a proposed new wholesale fibre broadband pricing plan, citing competition concerns.

It is the first time the watchdog has intervened in the UK wholesale market in this way, following the implementation of its Telecoms Access Review 2026-31 (TAR26), which was published in late March and came into effect on 1 April this year.

While approving a number of other new commercial offers by Openreach, Ofcom has stepped in to block the BT-owned infrastructure firm’s “Incremental New to Openreach” offering, which would give monthly discounts to retail ISPs for bringing new full fibre customers onto its wholesale network. Openreach was offering to introduce a new £9.50 monthly discount per customer, for up to 30 months, for any signups above an ISP’s normal number.

“We are confirming that we are intervening to direct Openreach to withdraw its ‘Incremental New to Openreach’ offer, as the charges are not fair and reasonable and could harm the development of network competition,” Ofcom noted in its statement about the decision. The regulator went on to say that the discount involved “may mean that other reasonably efficient operators couldn’t match it while also recovering their costs”.

The move will have come as no surprise to Openreach, as Ofcom had warned against the wholesaler using its position as the incumbent to “drive other networks out of the market” in a statement published in July, as we reported here.

Unsurprisingly, Openreach defended the proposition, with its managing director for commercial, James Lowther, stating in comments emailed to TelecomTV that the wholesale player had “put this offer forward in good faith”.

“While we continue to believe the offer would have benefited customers and competition, we’ll review the decision carefully and continue to engage constructively with Ofcom and our customers,” Lowther added in a statement emailed to TelecomTV.

“We’ll launch our other offers and continue to compete fairly, including our FTTP offer within the VMO2 footprint and an Ethernet offer for businesses. We’ll continue to invest in the UK’s digital infrastructure, bringing growth in every postcode and helping our customers deliver for homes and businesses,” he added. 

Other UK broadband sector voices offered a surprisingly mixed reaction to the decision, with some calling on Ofcom to go further, while others warned of unforeseen consequences for consumers. Nexfibre, which is a UK joint venture owned by InfraVia and Virgin Media O2’s parents, Liberty Global and Telefónica, called the Ofcom decision a “positive step” for competition in the sector, but said the regulator should “go further”.

In a statement emailed to the media, a Nexfibre spokesperson noted: “Openreach’s tactic of drip-feeding price changes via special offers needs to stop, at a time when competition remains nascent. Ensuring alternative networks have the incentives to invest, grow and achieve scale will be critical to creating credible, sustainable competition,” while touting the benefits of its proposed £2bn takeover of major altnet Netomnia in a deal that is currently under review by the UK’s Competitions and Markets Authority (CMA). Check out our interview with Nexfibre CEO Rajiv Datta to find out more about that M&A deal.

Broadband comparison site Broadband Genie also praised the decision in comments sent to the media, saying it “lowers the risk of squeezing out independent altnets that drive long-term competition.”

Alex Tofts, strategist at Broadband Genie, stated: “Consumers rely on real market choice. Independent providers operating outside the Openreach footprint frequently lead the way on speed, pricing and customer service, compared to well-known providers.”

However Tofts also offered a warning: “The key challenge now is ensuring this intervention doesn’t inadvertently drive up bills during a cost-of-living squeeze. History shows that Ofcom’s interventions can easily backfire on the very customers they’re meant to protect.”

- James Pearce, Editor, TelecomTV