Ofcom Blocks Openreach's £35 Fiber Discount

Ofcom has blocked Openreach's 'Incremental New to Openreach Customer Offer', a discount for bringing customers onto its fiber network, citing concerns that rivals might be unable to match the price and recover their costs. The decision aims to protect competition in the UK market, particularly for alternative network operators.

The rejected offer would have rewarded internet service providers (ISPs) for connecting more new fiber-to-the-premises (FTTP) customers to Openreach than an agreed baseline. The offer included a £35 connection discount and a monthly reduction of up to £9.50 for as long as 30 months. Ofcom provisionally decided to block the offer in July and consulted the industry before making the decision permanent.

Ofcom allowed Openreach's other proposed discounts to proceed, including a one-off £50 rebate for connections above an ISP's usual number of new Openreach customers in areas served by Virgin Media O2. Another offer gives communications providers a free connection when net new Ethernet demand exceeds 90 percent of their historical run rate.

The decision was welcomed by wholesale fiber operator nexfibre as a positive step toward protecting competition in the UK market. Openreach notified Ofcom of the pricing plans in June, and the regulator has previously declined to intervene in Openreach discount schemes, including Equinox and Equinox 2.

## Why it matters The UK market for fiber-to-the-premises (FTTP) connections is highly competitive, with alternative network operators (altnets) competing with Openreach, Britain's largest fixed-line infrastructure provider. Ofcom's decision to block the 'Incremental New to Openreach Customer Offer' is intended to ensure that altnets can continue to attract customers and grow their businesses without being unfairly disadvantaged by Openreach's pricing strategies. The regulator's concern is that if altnets are unable to match Openreach's prices, they may struggle to recover their costs and ultimately be forced out of the market, reducing competition and choice for consumers.

The decision is significant because it demonstrates Ofcom's commitment to protecting competition in the UK market and ensuring that all providers, including altnets, have a fair opportunity to succeed. With the UK government aiming to roll out FTTP connections to millions of homes and businesses, the market is expected to continue growing, and Ofcom's decision will help to ensure that this growth is driven by competition and innovation, rather than dominance by a single provider.