BT hits LLU target but sidesteps price cut

 

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By Alun Williams

Posted on 5 Feb 2007 at 12:27

BT is proclaiming that it has now established 1.5 million LLU (local loop unbundling) connections. The UK telco says it will reach this figure of unbundled local loops for communication providers this week, and it represents an increase of 200,000 connections in a month, since the last figures were published.

Local loop unbundling is the process by which BT has to share local exchanges with competitors, giving them direct access to the final 'loop' to customers' houses. This has enabled third parties, such as Orange and Sky (which acquired Easynet in October 2005), to offer more direct competition to BT rather then 'selling on' products based on BT's own BT Wholesale services.

'I'm delighted to announce that the LLU market in the UK has officially taken off,' declared Openreach's CEO, Steve Robertson. 'It is a tribute to a great deal of hard work and investment, by the whole Openreach team and by our LLU customers, that we have achieved this number.'

He added that BT is going to spend 'around £1bn this year' on improving the access network further.

The figure has been achieved earlier than expected - BT scheduled this total to be achieved by May 2007. In November of last year, it said that May 2007 would then see a reduction in its IP Stream wholesale broadband prices in order to give Internet service providers a competitive, cost-effective alternative to local loop unbundling.

Will BT be bringing the IP Stream reductions forward, correspondingly? A BT spokesperson, told us that the price changes were fixed for May and that hitting the milestone early would not change this. He maintained that companies using IP Stream would already have made their plans according to the existing timetable and this should not be changed...

BT said that rental charges for the most highly used wholesale broadband product - BT IP Stream - would be reduced by nine per cent (with further reductions planned for January 2008).

Earlier this year we reported on the record rise of LLU connections. December saw the biggest surge yet in the number of unbundled Internet connections in the UK, with 200,000 new LLU lines taking the total to 1.3 million. This represented a ten-fold increase since the start of 2006.

On the subject of broadband, BT also announced last month that it had doubled its target for broadband connections, expecting to break through the 10 million connection mark.

Openreach, which began operations in January 2006 following regulatory settlement with Ofcom, is the arm of the business that looks after BT's local networks.