Last four years sees a drop of 40 percent in the cost of UK broadband

A number of industry experts are now questioning whether the trend of drops in the cost of broadband throughout the UK over the last four years can continue and also why it happened in the first place.

A process was created back in September 2005 by the telecommunications regulator, Ofcom that forced the incumbent network operator BT to allow its rival operators to install their broadband equipment in the BT telephone exchanges throughout the UK and this process was known as ‘local loop unbundling’.

The resulting drop in the price of broadband was incredible as it now allowed broadband providers to sell their own services rather than rely on selling BT’s wholesale broadband services, which meant that broadband prices became highly competitive.

Both homes and businesses throughout the country are now receiving broadband services from more than 30 broadband network operators over more than 6 millions ‘unbundled’ phone lines.

Ed Richards, the chief executive for regulator Ofcom said “In just four years, unbundling has gone from a flicker on the dial to a major competitive force in telecoms. This has delivered the dual benefits of driving up broadband take-up and driving down prices.”

The average cost of broadband services in September 2005 was £23.30 per month but thanks to the huge reduction in pressure on broadband prices an equivalent service now costs a mere £13.61 a month.

The resulting competition created by this LLU process has directly led to a massive reduction in broadband pricing of 42 percent overall.

It has, however, been found in recent surveys that although these huge saving are available to most consumers, these potential saving are simply not being taken up by a significant number of users throughout the country.

Source – msn.com