Ofcom blocks ‘unfair and unreasonable’ Openreach customer deal
Key Points
- Ofcom has blocked a proposed deal from Openreach to attract new customers to its network by offering rebates to ISPs.
- The Incremental New to Openreach Customer deal would have have offered ISPs a £35 connection rebate and a £9.50 monthly rental rebate.
- Ofcom found the deal took unfair advantage of the network's Significant Market Power (SMP) and would erode competition in the UK's fibre infrastructure market.
- Other offers, including a geographically limited version of this offer applied to VMO2 legacy network areas, were allowed through by the watchdog and take effect from 1 October 2026.
The UK’s communications regulator has banned fibre provider Openreach from launching an offer that would give ISPs a monthly discount of up to £9.50 to attract new customers to the network.
Ofcom published a statement today announcing that it was stepping in to block the “Incremental New to Openreach Customer” offer, which would give ISPs a £35 connection rebate and a £9.50 monthly rental rebate for New to Openreach customers.
This offer is aimed at onboarding new ISPs and their customers onto the Openreach fibre network, but it has now been ordered to withdraw the offer by Ofcom, with the regulator finding that Openreach’s offer was uniquely possible due to the company’s position as a Significant Market Power (SMP).
Openreach’s total full fibre network footprint now reaches 22.8 million premises, or 67.2% of all premises in the UK, although the pace of its rollout has slowed somewhat in recent months.
In its announcement that it would block the Incremental New to Openreach Customer offer, Ofcom said that allowing this to go forward would make it more difficult for smaller fibre networks to compete. It said the proposed deal was unfair and unreasonable.
“We have determined that Openreach’s charges under this offer are not fair and reasonable, because they result in margins that may not allow a reasonably efficient operator to recover its costs,” Ofcom said.
“The discounts are targeted at customers which are important to altnets’ ability to maintain and grow their customer base, while leaving prices for other customers unchanged.”
It added that if competing networks attempted to match these discounts, they would not be as able to recover their costs and grow their adoption to compete healthily with Openreach.
“There is a risk that the level of the offer prices could harm the development of network competition, to the detriment of consumers in the long term,” the regulator said.
This offer, which was scheduled to go live from 1 October 2026, was one of several Openreach offers under review by Ofcom and was the only one to be blocked by the watchdog. Other offers, including similar rebates for ISP in areas where Virgin Media O2 has deployed cable legacy infrastructure, were allowed to go through.
Openreach Managing Director for Commercial James Lowther said it believed the blocked offer would have benefited competition but said the company would engage constructively with Ofcom.
“Ofcom’s decision not to approve our incremental FTTP new to Openreach offer is in line with their consultation position. We put this offer forward in good faith to help our customers compete and deliver better value for households,” Lowther said.
“While we continue to believe the offer would have benefited customers and competition, we’ll review the decision carefully and continue to engage constructively with Ofcom and our customers.”
“We’ll launch our other offers and continue to compete fairly, including our FTTP offer within the VMO2 footprint and an ethernet offer for businesses.”
