Gartner predicts Ofcom rules will bring in more UK broadband players

By Matt Whipp

Posted on 23 Dec 2003 at 15:06

Gartner's latest research predicts that recent price setting measures by Ofcom will make wholesale broadband products more attractive, encouraging new players to enter the UK market.

Currently, most ISPs offer broadband to their customers using BT's IPStream products - essentially renting a BT-managed broadband line and making a bit on top - but operators that have taken up DataStream products and moved into exchanges under the Local Loop unbundling schemes stand to benefit from a proposed pricing system which will maintain a specific margin between wholesale and retail prices.

Gartner suggests that the effect of new regulations and proposed pricing structures to be implemented early next year will allow existing DataStream and operators using Local Loop Unbundling options to be able to expand their geographical coverage and provide a range of new services.

For example, while IPStream customers have had the choice of products from 512Kbits/sec upwards, Tiscali, a DataStream customer has been able to offer cheaper and lower bandwidth options. And on the other hand, the likes of Bulldog, which has utilised Local Loop Unbundling (LLU) to place its equipment in exchanges, has offered 1Mbit consumer broadband products well before BT even trialled IPStream 1000.

Gartner advises that once the new regime is in force, companies should evaluate whether providing broadband via DataStream or LLU is more viable, ISPs should look to such companies for alternative providers and end users should re-evaluate their broadband contracts and consider their options.