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ISPs to meet Ofcom over BT broadband price hikes

Graeme Wearden ZDNet.co.uk

Published: 18 Aug 2004 17:55 BST

The UK's Internet Service Providers Association (ISPA) is wading into the row over BT's decision to raise the cost of some of its wholesale business broadband packages by as much as 30 percent.

Several of ISPA's members are understood to be furious about the price rises, which affect BT's IPStream Office and S range. ISPA has now begun consulting with its members to gauge the feeling of the whole UK Internet industry, and is set to meet Ofcom this Friday to air any concerns.

"Particular ISPs have expressed vociferous views," explained an ISPA spokesman. "We're still finding out what the impact will be on the broadband market".

As previously reported, it is thought that BT has made these price rises in advance of an Ofcom ruling of unfair broadband pricing by the telco.

The regulator is expected to rule later this summer that IPStream products have been too cheap relative to Datastream -- a separate product that rival operators can use to compete with BT Wholesale to offer their own alternative broadband products.

BT has declined to go into too much detail about its motivation in bringing in such unexpected and unwelcome price rises, but it has said that the move was made "in order to meet our regulatory obligations".

Some ISPs have already indicated that they will not pass BT's price rises onto end users. This has led to concerns that some smaller ISPs may not be able to follow suit without destroying their profit margins.