BT Group Plc’s infrastructure division Openreach is in talks to offer lower-cost deals to internet service providers that use its network across the UK, according to two people familiar with the matter.
(Bloomberg) — BT Group Plc’s infrastructure division Openreach is in talks to offer lower-cost deals to internet service providers that use its network across the UK, according to two people familiar with the matter.
Proposals include lower line rental costs, no volume commitments for sellers, and a cut to the amount charged for migrating customers from copper lines to fiber, according to the people, who asked not to be named discussing non-public information.
Companies such as Vodafone Group Plc, TalkTalk Telecom Group Ltd. and Comcast Corp.’s Sky are among those that sell services using London-based Openreach’s fiber optic connections.
“We’re in constant discussion with the retail providers about potential offers and options,” said a spokesman for Openreach, who didn’t dispute the details being reported.
BT shares rose 1.5% to 128.7 pence at 8:55 a.m. in London. The Telegraph separately reported that BT rival Virgin Media O2 had shelved its plan to acquire TalkTalk.
The new Openreach offer is dubbed Equinox 2 and was earlier reported by the Financial Times. The move could lower retail prices for fiber and accelerate consumers’ take-up of the faster technology, upgrading them from older copper connections.
“Our initial reaction is to be slightly disappointed that Openreach isn’t fully flexing its current pricing power, which has been a general theme lacking across all EU telcos,” New Street Research analyst James Ratzer said in a note to clients Monday.
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