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BT to rent cheaper FTTP lines to ISPs - if they stump up £1k a go

Hefty one-off fees demanded for 330Mbps broadband

Internet Security Threat Report 2014

BT will demand pricey one-off construction and installation fees from ISP providers that want to offer blistering fast fibre products to their customers.

The national telco said it was up to those companies to decide whether to pass on the costs, which are expected to start at about £500 and could climb to well above £1,000 in some cases depending on the distance of a property from BT's fibre network. The prices are yet to be finalised, however.

The company said it will apply the high one-off charges to its service after confirming that from next June it will cut its rental price of "ultra-fast" fibre-to-the-premises (FTTP) tech - which has a theoretical top speed of 330Mbps downstream and 30Mbps upstream - to £38 a month from the current £60 price tag.

That move will coincide with the launch of BT's FTTP on-demand product, which will start rolling out next spring and also be punted at £38 a month to ISPs.

BT said:

As Openreach has previously indicated, communications providers will be charged a distance based construction charge for FoD [fibre on demand] due to the extra work involved in providing a direct fibre connection. It will be for communications providers to decide whether to pass this charge on to their customers.

Installation fees of £500 will be slapped on top of the one-off construction charge, BT added.

The company massively relies on its copper infrastructure to deploy fibre-optic broadband services to its customers. It is rolling out the so-called "mixed economy" tech to roughly 65 per cent of the UK at a cost of £2.5bn.

Three-quarters of the upgrade will involve fibre-to-the-cabinet (FTTC) installs, which involves Openreach engineers laying fibre from BT's exchange to a street-side box - the service is then carried into homes and businesses via a copper phone line. The FTTC product boasts theoretical download speeds of up to 80Mbps and upload speeds of 20Mbps.

Many fewer homes and businesses will be offered FTTP products in Blighty because BT has found that rollout to be costly, disruptive and time-consuming.

BT described its expensive FTTP on-demand product - which it is mainly aimed at small and medium-sized companies - as a way of "future proofing" its network because it can be deployed from its street cabinets.

"It is now time for us to focus further on FTTP and I am pleased to say that we are making it more affordable than ever," gloated BT's Openreach managing director Mike Galvin. "I am sure that small businesses will welcome this major price cut and I am also sure that our fibre on demand plans will be of great interest."

Of course, the reality is that many ISPs may find such a product difficult to shift given that it's likely they would have to fold BT's hefty fees into the subscriber costs for their austerity-slapped customers. In other words, despite BT's promise of a price slash, FTTP remains something of a vanity product for rival telcos who would need to demand a high monthly payment from their punters to get any sort of return on their investment in the tech. ®

Internet Security Threat Report 2014

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