Thursday, June 23, 2011

News: Ofcom agree with Digital Region in BT dispute


Ofcom, the independent regulator and competition authority for the UK communications industries, has agreed with the companies behind the Digital Region in South Yorkshire that BT are charging too much for the use of their existing lines.

Ofcom has published a draft determination to resolve a dispute between Digital Region Ltd and project partner, Thales with BT over the cost of "sub loop unbundling" products. These allow Digital Region to install equipment at a location close to BT's street cabinets and physically take over or share the copper access network connection.

This is a key part of the network, which is only available across South Yorkshire, that will help to provide guaranteed download speeds of 25Mb and above.

BT charges fees of between £106.62 and £127.61 and annual rent of £93.96 for the connection. Digital Region Ltd and Thales told Ofcom that it estimated the real price of the connection fee should be about £50, and that the annual rent should be about £82.35.

Ofcom is proposing that BT is required to adjust the charges so as to "only reflect costs that are reasonably derived from costs of provision" and that "BT makes a payment to DRL/Thales to reflect any overpayments where BT's charges included costs that are not costs of provision."

Digital Region is wholly owned by Yorkshire Forward and the four local authorities of South Yorkshire. Together they attracted European, regional, local and private investment of over £90m, including £30m from the European Regional Development Fund. Thales UK is responsible for building, managing and developing the network.

By the end of May a total of 476km of new fibre-optic cable had been installed, which equates to 69% of the total duct of the network. 30 exchanges have been completed so far with 1,010 cabinets installed. When the network rollout is complete, more than 1,500 street cabinets will be in place across South Yorkshire, serving a population of over 1.3 million citizens, 546,000 homes and 40,000 businesses.

Digital Region website


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