BT Openreach have announced a series of sharp price increases on their range of legacy services. This is the price at which resellers like us at RHM purchase and it impacts BT Retail, who have already announced a 9.3% price increase across most of their services for small businesses.
The most noticeable changes from BT Openreach that will impact all resellers who buy from them are a 4.97% rise in a standard business PSTN and ISDN2 channel line rental. This is the second such rise in a 12-month period. These price hikes then have a knock-on effect on other services impacted by the price of PTSN and ISDN2 lines.
If you are a direct customer of BT Retail, you’ll know last year they introduced a new annual price rise mechanism into their standard terms and conditions which was CPI + 3.9%. Therefore, this January with CPI at 5.4% their increase will be 5.4 + 3.9 = 9.3%.
This increase will roll out across most of their portfolio for small businesses.
The changes will come into effect from the 1st of April 2022.
BT Retail have been quick to act and already announced the details of these changes on their websites. If you’re a customer of theirs, more information on their annual price increase and CPI+ is listed here:
https://btbusiness.custhelp.com/app/answers/detail/a_id/54367/?s_cid=btb_FURL_business/cpi21
At RHM we will announce our specific response to these changes within in the coming weeks.
You may decide to shop around as a result of these significant changes, but be mindful this impacts the whole of our industry. All resellers buy from BT Openreach, and it’s Openreach who are putting up their legacy prices.
As always with these things, the devil is in the detail. Despite BT Openreach not putting up all their prices, BT Retail are increasing theirs across their whole product portfolio.
This approach means it’ll take time to understand the specific impacts on each affected business.
At RHM it is more than likely we will only look to increase PSTN business line rental and ISDN2 channel rental. This is because the price hikes on these services will have the most significant impacts to our business model. We won’t look to take a whole portfolio approach.
However, we obviously cannot speak on behalf of the 1000+ other resellers of BT Openreach and what they may decide to do.
You may have noticed that there has been an explosion in alternative fibre providers emerging in the market as competition to BT Openreach. Examples include CityFibre, who have been rolling out in cities across the country. There are also more localised providers such as G Networks in London or Jurassic Fibre down in the Southwest.
Ofcom did a deal with BT in the last couple of years which now allows BT to be able to put up prices of their legacy services. These services previously had tight price caps. In exchange for this Ofcom have allowed for increased competition for fibre services, notably fibre to the premises (FTTP). This has stimulated competition and investment – hence the raft of new suppliers and the new annual price increase regime from BT Retail and Openreach.
All this links to the strategic aim of accelerating fibre broadband availability across the country and in tandem the big switch off of the legacy BT Openreach network at the end of 2025. Ofcom’s statement on the price review is available here:
https://www.ofcom.org.uk/consultations-and-statements/category-1/2021-26-wholesale-fixed-telecoms-market-review
There are a few milestone dates you need to be aware of between now and the end of 2025 when BT will switch off PSTN and ISDN lines.
This process is taking place already in Salisbury and another 155 telephone exchanges in the UK. In these locations you cannot buy a new analogue business line. This change will roll out across the whole of the UK from September 2023.
This change has the potential to cause some heavy disruption. We advise you to start thinking about this now and building a plan to migrate to IP-based voice communication.
We’d like to reassure all our RHM customers that we will work hard to minimise the impact of price increases wherever possible.
We’d encourage you to get in touch with us and we would be more than happy to give you a no-nonsense consultation. We know that this situation is a bit of a maze, and we want to help guide you through it.
We have already helped hundreds of our customers migrate across from legacy services to VOIP lines or cloud-based telephony solutions. These customers will not be affected by the upcoming changes.
Those of you still using traditional phone lines connected to an on-premise phone system should get in touch and at the very least kick off a discussion so you can start planning your next steps.
You may be pleasantly surprised with the migration options. In many instances we can deliver cost savings, increased functionality and some helpful new features.
Get in touch 0800 041 041 or enquiries@rhmtelecom.com
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