July 24, 2018 / 10:09 AM / in 5 months

UPDATE 1-BT incentivises operators to move customers to faster broadband

(Adds details, TalkTalk reaction)

LONDON, July 24 (Reuters) - Britain’s BT Group said on Tuesday it would encourage telecom operators to move residential and business customers onto faster broadband by offering them long-term discounts on its network.

The company, which runs Britain’s biggest telecoms network, said the discounts would go beyond the pricing controls set by regulator Ofcom and would be available to any operator that grew its customer base by an agreed proportion.

Clive Selley, chief executive of BT’s network unit Openreach, said the offer would help Britain’s homes and businesses to experience the benefits of faster and more reliable broadband.

It would also incentivise wholesale customers to participate in the long-term investment in digital infrastructure by upgrading more of their customers to superfast and ultrafast services, he said.

More than 27.8 million homes and businesses can access faster broadband provided by fibre-optic lines, either to cabinets in the street or all the way to the building, but so far only 9.8 million have upgraded, BT said.

Broadband providers including Sky, TalkTalk and Vodafone use the Openreach network to serve their customers, offering standard copper-based connections or faster products that include some fibre provision.

TalkTalk said Openreach’s decision to lower wholesale fibre pricing was good news for customers.

“We have long argued that lower wholesale prices are essential to driving higher fibre take-up, which leads to happier, more loyal customers,” said Chief Executive Tristia Harrison.

She said the agreement should also support investment in alternative networks, including TalkTalk’s plan to build a full fibre network to more than 3 million homes and businesses.

Broadband providers need to increase the take-up of faster broadband services to justify spending billions of pounds on new full-fibre networks.

Britain set out plans to speed up the roll-out of full-fibre networks on Monday to help the country catch up with European rivals that have much wider ultrafast broadband coverage.

The proposals balanced the need to provide a fair return on investment for BT and other companies building networks plus the acknowledgement that it would need public money to get fibre to rural areas.

Reporting by Paul Sandle; editing by Kate Holton and Louise Heavens

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