BT ready to fight over broadband

This weekend, however, BT hit back at a note by the broker Redburn that wiped 2pc off its share price on Tuesday by suggesting the so-called “margin squeeze” investigation could force its Openreach division to cut its monthly wholesale price by £2.

The note caused the biggest single-day fall in BT’s share price for two years because the consensus in the City had been that Ofcom would not act and the company’s superfast broadband pricing would continue to be unregulated. Accelerating take-up of the service, and BT’s control of four fifths of the market at retail, is delivered an improving financial picture for the company even as it ploughs billions into sport rights.

TalkTalk complained to Ofcom last year that BT was abusing its dominant position by making the wholesale price, that all providers pay, too close to its own superfast broadband retail price.

The complaint alleged that it meant rivals could not properly compete in the relatively new market because their profit margins are too thin.

BT’s spokesman said: “Any suggestion that BT is margin squeezing in the provision of fibre is nonsense.

“BT Consumer makes a profit from selling fibre based on Openreach’s wholesale prices and Sky and TalkTalk have publicly stated that they do too.”

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