Last month BT reduced the price of the IPStream wholesale service by at least £1.75 per customer. This product is run wholly on the BT network, by BT. The Datastream product, which allows other operators to use the BT network, on payment of a monthly fee, did not have a price reduction, and therefore the costs to other operators remained the same.
A rash of complaints to Oftel followed, and the results were seen on Wednesday.
In a statement, David Edmonds, Director General of Telecommunications, said:
"Our initial findings were that these price changes, relative to the Datastream product, could have prevented other operators from competing to provide broadband services to internet service providers.”
"Maintaining the commercial viability of the Datastream product is crucial if other operators are to be able to compete fairly in broadband connectivity. It is also vital to ISPs and hence consumers to ensure the maximum choice and competitive pressure in the market.”
Paul Reynolds, chief executive of BT Wholesale confirmed the move in a statement, saying, "As part of our drive to reduce broadband prices, we agreed, in discussions with Oftel, also to cut DataStream prices.” He continued, "This is good news for the industry and a further boost to the broadband market."
The investigation into the price cuts is continuing and the results should be known next month.