The monthly cost of billing is probably totally in the line rental element too, at the wholesale level the WLR/MPF is pretty much flat with a long term trend downwards. So its not Openreach charging more - but then maybe if they did the local loop might see better maintenance and more engineers

In reply to a post by iand:

We have not seen any material change in phone lines, so why the cost increase!.

BT staff get pay rises ... increase in cost of spares ... increase in business rates which are payable on poles, ducts, cabinets, manholes and even the copper wire delivering the service.

So its not Openreach charging more - but then maybe if they did the local loop might see better maintenance and more engineers

Who or what is stopping them charging a bit more?

In reply to a post by Apprentice:

Who or what is stopping them charging a bit more?

OFCOM - Under pressure from Service Providers to reduce the price they pay.

WLR is a regulated product, with OFCOM controlling what Openreach can charge.

Edited by deleted (Thu 24-Sep-15 09:01:23)

It's not even a real cost difference. The price has gone up 14.5% in those thirteen years. Looking at data from the ONS, inflation (by the lower CPI measure) has been about 35% over those 13 years (more if you uses RPI).

So, in real terms, that's around a 20% decrease in costs.

The wholesale cost of a phoneline hasn't gone up, at least to any significant level, despite inflation (which is about 35% in the 13 years).

What has gone up is the retail cost, and for several reasons. One is that it's clearly being used by ISPs to subsidise the headline broadband price by increasing their markup. The other reason is that fixed line call revenues have collapsed. Those call revenues were used by service providers to subsidise rental costs, but given there's no longer that revenue, there's been some cost rebalancing.

In any event, the total cost of the package has gone down in real terms by something like 20% once you feed in inflation during the period.

You have to be very careful about falling foul of EU state aid rules. It's probably possible in the BDUK intervention areas, but I doubt that such a "tax" or levy can be used in areas covered by competition (like those where VM is available).

As is the cost of SMPF and MPF LLU

Those things have all gone up, but the wholesale cost to the division that does the poles, ducts has gone down, and even more so when you allow for inflation.

In reply to a post by nemeth782:

It's actually got cheaper. That £381.24 is more like £660 after adjusting for inflation by the Consumer Price Index.

This is a bad thing though. I'd rather broadband cost twice as much and had more investment myself.

And an element in that calculation is VAT, 17.5% in 2002 but 20% now.
The ex VAT then was £324.46, and now £364.00. According to the figures I saw the rise, June to June2002/15 is just short of 33%,
so that £364 is about £274 in old money!!!