Extract A: Ofcom report into the UK residential broadband market

An investigation by Ofcom into the residential broadband market concluded that consumers have been missing out on £1.8 billion a year due to high out-of-contract "loyalty penalties" and slow speeds compared to what would be expected in a fully competitive market. It found that 58% of subscribers have remained with their legacy provider (such as BT, Virgin Media, or TalkTalk) for over 8 years. These customers could save around £180 a year by switching to alternative networks, but consumer inertia remains high.

However, Ofcom found no explicit proof of collusive behavior among the dominant legacy operators. Furthermore, independent fiber-to-the-premises (FTTP) 'altnets' have grown rapidly, achieving a combined market share of 18% in residential broadband.

To stimulate market dynamism and protect consumers, the regulator has promoted measures to open up and increase competition in the residential broadband market. These include:

• the implementation of 'Open Telecoms', allowing regulated third-party comparison apps to securely access customer data usage history and speed metrics to recommend tailored, cheaper packages and facilitate instant switching
• the enhancement of the 'One Touch Switch' (OTS) service, guaranteeing error-free, seamless migration between different physical networks within 24 hours, with the new provider managing the cancellation of the old contract
• a mandatory cap on mid-contract price-indexing escalations and late-payment penalties to protect vulnerable low-income consumers who face high digital exclusion risks.

---