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Ofcom seeks to slash UK broadband prices

We could soon pay less for our broadband, as Ofcom wants to slash how much BT charges ISPs to rent its copper wires.

Our broadband bills could be a lot lower in the next few years, if Ofcom gets its way.

The telecoms regulator wants to slash how much BT can charge other Internet service providers (ISPs) to use its telephone and broadband lines, the BBC reports. BT has a monopoly on the network, leasing lines to other ISPs through its Openreach access division. And I have to say, the pricing does seem a little odd.

ISPs currently pay BT £93.27 a year to supply landlines, £9.75 to supply the Internet, or £84.26 for both. I suppose BT is trying to encourage companies to offer both, instead of just one or the other. Ofcom wants these prices lowered by up to 12 per cent over the next three years.

Ofcom said: "These controls would reduce wholesale charges, which could be expected to lead to real-terms price reductions for consumers, as communications providers pass on savings to their landline and broadband customers."

Note the "could be expected" -- no price drop is guaranteed.

Back in May, BT's rival TalkTalk complained about what it claimed were sky-high prices, prompting Ofcom to investigate. At the time, BT dismissed the case as "spurious".

Ofcom allowed BT to set whatever prices it saw fit back in 2009. This was to cover BT's investment in infrastructure and the associated risks.

BT and TalkTalk have a chequered history, with the respective company heads trading insults regarding each other's business practices.

This week, BT announced it would soon offer 300Mbps broadband, though only for around 100,000 homes and businesses. It also unveiled the Home Hub 5 -- which looks a lot like the Home Hub 4, but does away with the need for a separate box if you want super-fast broadband through BT's Infinity fibre service.

Do you pay too much for your broadband? Should Ofcom slash these prices? And is BT in an unfair position? Let me know in the comments, or on our Facebook page.