UK telecom regulator Ofcom came down heavily on BT asking it to cut bills by at least £5 a month for BT’s landline only customers.
The latest plan would return telephone line rental prices to 2009 levels. Ofcom in a statement said BT used its powers to increase the bill for landline only users. Ofcom is expecting that BT’s rivals will follow suit.
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The development will benefit more than two million people who buy only a landline telephone service from BT. Almost 80 percent or 2.3 million of the UK’s 2.9 million landline-only customers are with BT.
Ofcom found that landline customers – often elderly or vulnerable people who have remained with the same landline provider for decades – are getting poor value for money. They are not switching for bundled plans for broadband or pay TV and paying huge bills without any reason.
Major land-phone service providers have increased their line rental charges significantly in recent years – by between 25 percent and 49 percent in real terms. This is despite providers benefiting from 26 percent fall in the underlying wholesale cost of providing a landline service.
BT customers with landline only connections will be paying no more than £13.99, after a reduction of at least 26 percent – from £18.99 per month for line rental currently.
Ofcom is also proposing safeguards to prevent BT from making future increases to line rental and landline call costs by more than inflation.
Sharon White, Ofcom Chief Executive, said: “Line rental has been going up, even as providers’ costs come down. This hurts people who rely on their landline the most, and are less likely to shop around for a better deal. We think that’s unacceptable.”
Ofcom said the planned price cut would not apply to landline services sold by BT Consumer as part of a bundle of services including broadband.
