LLU results in 40% drop in broadband prices

Local loop unbundling (LLU) systems are thought to be responsible for a 40 per cent drop in the cost of broadband connectivity since 2005.

The system has enabled internet service providers (ISPs) to install their own equipment in telephone exchanges operated by BT, meaning they have been able to avoid passing on the telecom giant's wholesale costs to their own customers.

As a result, 30 ISPs provide broadband services throughout the UK, with customers able to use VoIP solutions and access faster download speeds through more than six million unbundled lines.

Ed Richards, chief executive of 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 monthly price of a broadband connection has fallen by nearly £10 to £13.61 since autumn 2005.

In related news, BT has accelerated its plans to deliver high-speed broadband to Glasgow, with the roll-out to begin in the autumn.