BT has today promised a winter of intense competition in the UK fixed line, broadband and TV sector after Ofcom effectively lifted restrictions on the company’s pricing policies. In simple terms, like all of the other operators in the UK telecom, broadband and TV sector, British Telecom will be able to subsidise its fixed line phone service in order to make “bundles” of phone, broadband and TV services more attractive to consumers.
This is effectively the second privatisation of British Telecom which has until now had to compete with the likes of BSkyB, Virgin Media and TalkTalk on a very different playing field. The company is currently working on a number of bundles which will hit the market in the short to medium term and inject a significant amount of competition into what is a massive market. We could see more and more consumers switching their phone lines, broadband and TV service providers in the weeks and months ahead but there is no way that BT will have this all its own way.
Whether or not this will impact negatively upon competition in the sector in the medium to longer term remains to be seen but it will ultimately turn the screw on many of the smaller providers in the sector.