UK Telecoms "Broadband pricing improves but wholesale a risk" Tang

Research evidence excerpt

UK Telecoms "Broadband pricing improves but wholesale a risk" Tang

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months. Separately, Community Fibre now offers 3 months' free broadband and has Associate Analyst

also removed mid-contract price rises (link). We think altnets will remain aggressive into obaloluwa.agboola@ubs.com

the mid term as they prioritise reaching 30-35% penetration of their footprint (vs 20% +44-20-7568 3969

on average) as the market switches over from VDSL to FTTP. The altnet fibre footprint

covers c20m homes (c2/3 of the UK). For a run through of the key issues, market shares

and key data points, see our UK deep dive (link).

Openreach promotions could further pressure retail broadband pricing

Openreach has proposed new promotions on wholesale pricing which we think could

increase competition in the market and put further downward pressure on UK retail

broadband pricing. The promotions are subject to Ofcom approval. There are three

elements to the Openreach promotions: [1] From 1 July 2026, a cap of £19.32pm on the

line rental paid by ISPs for new and upgraded fibre lines. The £19.32pm cap will be

adjusted by CPI-1.25% annually with a floor of 0%. This promotion will be valid for a

year and last for 24 months on each order meaning the offer benefits would last to end

of June 2029 for those coming in at the end of the offer window. This gives ISPs an

incentive to offer notably faster products at limited additional cost. FTTP ARPU for FY-26

was £18.4pm and the rate card for Openreach is currently £17.21-23.28pm for speeds

of 150Mbit/s to 1.8Gbit/s; [2] From 1 October 2026, Openreach is also proposing further

discounts of £9.50pm to ISPs that exceed a set baseline for FTTP volumes (link).

Effectively this move is halving pricing and seeks to lock in minimum volumes; [3]