Ofcom must recalculate dark fibre access fees

CMA orders Ofcom to recalculate charges after TalkTalk's appeal

fibre optic cable

Ofcom made an error in calculating the price for rival access to BT's dark fibre lines, according to a ruling made by the Competition and Markets Authority (CMA).

This follows a successful appeal by telco TalkTalk over the regulatory pricing of BT's dark fibre access services, and the CMA has ordered that Ofcom amends its methodology.

Dark fibre access gives rival ISPs to take direct control of fibre optic cables owned by Openreach. This means that these firms can installed their own equipment at both ends of an optical fibre running along Openreach's cable ducts.

Last November, the Competition Appeal Tribunal (CAT) referred two appeals to the Competition and Markets Authority (CMA) over the amount BT is permitted to charge other providers for purchasing leased line services.

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CityFibre and TalkTalk both appealed to the CAT following Ofcom's final decision in its Business Connectivity Market Review (BCMR) in April last year.

The CMA rejected CityFibre's appeal against the same Ofcom decision.

Ofcom has published its proposed amendment to the related regulation and has opened it up to consultation until 22 May. It estimated that the total impact of these changes "will be in the order of 5 million, or around 1% of the total allowed costs in the LLCC [Leased Line Charge Control] in 2018/19".

Richard Thompson, TalkTalk Business's commercial director, said that his company was "pleased that the CMA has recognised that BT's wholesale dark fibre price needs to be adjusted to ensure that it becomes the cost-effective alternative it was originally intended to be.

"Whilst there is still much to be agreed, we are very excited about the opportunities dark fibre will bring to increasingly data-hungry businesses, and we're looking forward to being able to unveil our plans for giving our customers access to the great value, high performance connectivity they're crying out for."

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