BT is under pressure from Ofcom to lower the cost of their leased-line services

BT has raised concerns about the extent of deregulation proposed by Ofcom for legacy retail services, suggesting that the regulatory body could have gone further in light of the emergence of more efficient alternatives. The European Commission has one month to review Ofcom's draft decision.

In its argument, BT maintains that the market for these services is highly competitive and that newer, more efficient alternatives have rendered the regulation of legacy services unnecessary. However, BT's statement does not explicitly agree with the intention of ensuring a backbone of high-speed business networks in the UK, nor does it support the aim of promoting competition in the market.

Ofcom, on the other hand, has proposed lighter regulation in London and Hull, where competition is healthier. The measures, if implemented, are intended to support services such as superfast broadband and mobile video streaming by ensuring a backbone of high-speed business networks in the UK. Ofcom's draft measures also aim to promote competition in the market.

One of the key proposals is the reduction of prices for 1 Gbps leased-line network services. Ofcom announced that BT Openreach will reduce its prices for these services by 11% below inflation. The proposed price cut is 11% lower than inflation over the next three years, which equates to approximately 8% given current inflation rates. This price reduction is expected to significantly reduce the price of newer Ethernet services for businesses.

However, BT disputes Ofcom's proposal on very high bandwidth Ethernet and optical services outside London. BT's statement does not provide explicit support for Ofcom's proposed price cut, and the company has not explicitly requested lighter regulation in London and Hull.

BT has provided evidence to Ofcom that there is no market failure requiring regulatory intervention. The company's stance suggests a preference for market-led solutions over regulatory interventions. The European Commission now has one month to review Ofcom's draft decision, which could potentially lead to further discussions and revisions.