Ofcom plans to overhaul regulation of BT’s Openreach to support competitive investment in fibre networks, with changes coming in between 2021 and 2026.

Jonathan Oxley, Ofcom interim chief executive, said: “These plans will help fuel a full-fibre future for the whole country. We’re removing the remaining roadblocks to investment and supporting competition, so companies can build the networks that will drive the UK into the digital fast lane.

“Full-fibre broadband is much faster and more reliable. It’s vital that people and businesses everywhere – whether in rural areas, smaller towns or cities – can enjoy these benefits. So we’re making sure companies have the right incentives to accelerate full fibre to every part of the UK.”

During the election campaign, Boris Johnson pledged to roll out fibre broadband across the UK within five years.

Under the proposals, Openreach will have to cap wholesale prices in line with inflation for rival companies using its network and it will have to support investment in rural areas where there’s little chance of multiple networks being built.

Openreach will also have to retire its ageing copper wires so that it’s not covering the costs of two parallel networks – copper and fibre.

BT said it welcomed the direction of Ofcom’s consultation on its approach to regulation.

Philip Jansen, chief executive, BT Group said: “We are already well on track to hit our target of building full fibre to four million premises by March 2021. We welcome the direction of today’s consultation from Ofcom, which is a significant step forward towards a widely shared ambition to fibre up the whole of the UK.

“We were also really encouraged by the new Government’s £5bn commitment to facilitate the build of gigabit-capable networks to the hardest to reach parts of the country.”

‘Good news for consumers’

Richard Neudegg, head of regulation at uSwitch.com, said: “Ofcom is being strongly pushed by the government and European code rules to provide companies with the incentives they say they need to lay more full fibre broadband cables.

“On the face of it, this is good news for consumers, with many of us still suffering with sub-par broadband. However, where Ofcom is proposing to allow higher wholesale prices, these inevitably get passed on to consumers – so it is important that services consumers are actually receiving, improve markedly too, both in terms of speed and reliability.

“It’s encouraging to see that the regulator recognises the need to support and drive investment in rural areas. If speeds are only improving in the major cities that are already enjoying faster connectivity, it will only serve to worsen the country’s widening digital divide.

“Ultimately any pledge to supercharge investment in fibre broadband will only be effective if people are given genuine choice underpinned by functioning competition between providers.”