Waiver of BT's price notification requirements to extend FTTC Simultaneous Provide offer

Summary

1.1 This document sets out Ofcom's proposals in relation to BT's request for consent to waive the requirement to notify price changes 90 days in advance in relation to a two month extension of the Generic Ethernet Access - Fibre To The Cabinet (GEA - FTTC) Simultaneous Provide wholesale offer. We invite comments from interested parties on whether it would be appropriate for Ofcom to accept BT's request and grant the proposed consent set out in Annex 4 of this document. Interested parties have until Tuesday 11 September 2012 to provide their views.

1.2 Significant Market Power (SMP) services condition FAA6 - Requirement to notify charges and terms and conditions ('Condition FAA6") was imposed on BT by Ofcom's 2010 statement Review of the Wholesale Local Access Market - Statement published in October 2010. In particular, Condition FAA6.2 requires BT to give not less than 90 days' notice of any amendment to the charges, terms and conditions for existing Network Access, before any such amendment comes into effect.

1.3 In the remainder of this document we refer to Openreach instead of BT, as this is the operating division within BT responsible for supplying FTTC wholesale products.

1.4 On 22 August 2012 Openreach requested that Ofcom consent to a waiver of the notification period referred to above to enable it to give effect to a price change earlier than 90 days. On the same date Openreach published the document titled "NGA023/12 Proposed extension of GEA-FTTC simultaneous provide special offer" which sets out details of the offer and Access Charge Change Notice ( 'ACCN OR264 Revised' - attached as Annex 6).

1.5 The document "NGA023/12 Proposed extension of GEA-FTTC simultaneous provide special offer" sets out the details of Openreach's offer to its wholesale customers. The scheme consists of a 50 discount to the FTTC connection price (£80) where FTTC is ordered together with either a) a new provide for Wholesale Line Rental (WLR) or MPF (Metallic Path Facility) or b) a request to start a line previously stopped for more than 90 days. The FTTC Simultaneous Provide offer is currently available to Communication Providers (CPs) from Openreach on a national basis and will end on 30 September 2012. The current offer also applies to FTTP connections at Brownfield sites but Openreach has not requested to extend the FTTP element of the offer beyond 30 September 2012 as it has attracted very low volumes.

1.6 Openreach intends to extend the FTTC Simultaneous Provide offer for two additional months (from 1 October to 30 November 2012) but limit it to specific geographic areas, i.e. large areas of London and North West England excluding Cumbria (the proposed list of Local Exchanges entitled to the offer is available in Annex 5). As Openreach has not provided 90 days notice of its intention to extend the offer, the two month extension would require Ofcom to agree to waive the 90 day notice period contained in SMP condition FAA6.

1.7 Openreach has advised us that the proposal to extend the price reductions earlier has already been presented to relevant industry stakeholders. Openreach has also advised that it has received no objections to its proposed offer but rather support from those Communication Providers (CPs) who are currently considering increasing their consumption of FTTC wholesale lines, e.g. Sky.

1.8 Openreach considers that the terms of the price change require 90 days' written notice in accordance with SMP services condition FAA6.2. However, Openreach wishes to bring forward the date on which the price reduction applies to 1 October 2012. Under SMP condition FAA6.1, Ofcom may consent in writing to Openreach publishing charges, terms and conditions in a manner different to that provided for in condition FAA6.2 where it considers it appropriate to do so. This would include a waiver of the requirement to provide 90 days' written notice.