After months of lobbying, BT has got its wish. Ofcom today announced it will formally consider letting Openreach raise the prices it charges BT's competitors for wholesale access to local exchanges.

BT has been crying foul over Openreach because its costs have increased alongside greater competition in broadband from local loop unbundlers.

They will be able to point to Ofcom's own assessment of the level of service offered by Openreach: it's not very good.

Ofcom said in a statement: "The evidence we have reviewed to date suggests that there is likely to be a case for some increases in the charges for the regulated access services.

"However, we do not currently believe that the increases need to be as significant as is implied by the projections provided by BT."

It'll review the current price ceilings in two phases. The first consultation, beginning today, will aim to set out the current costs of Openreach and expected changes, and examine the effect raising charges will have on BT's competitors.

A second consultation will address the pounds and pence nitty-gritty. Ofcom expects to have a new deal thrashed out by the end of this year.

Openreach set up shop in January 2006, after BT cut a deal with regulators to avoid an enforced full scale dismantling of its network ownership and the services other BT divisions use it for. The "functional separation" model that emerged is being pressed on other nation's regulators by the European Commission. ®

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• Openreach reaching for more cash (5 December 2008)
• Exclusive BT plots massive Openreach outsourcing deal (3 October 2008)
• Ofcom asks ISPs nicely to stop mis-selling broadband on speed (5 June 2008)
• Management cull fires BT profit slump (7 February 2008)
• Ofcom tells BT to buck up on unbundling (11 December 2007)
• BT promises to improve local loop services for rivals (27 October 2006)
• LLU taking off, but lift off slower than hoped (5 September 2006)
• Openreach cuts wholesale broadband charges (7 June 2006)