Changes in the way that BT charges ISPs for providing unmetered dial-up Internet connections, announced today, could result in price cuts for consumers, according to industry regulator Oftel.
Under the terms of FRIACO (Flat Rate Internet Access Call Origination) ISPs pay BT for the right to provide unmetered dial-up access on BT phone lines. Until now BT has charged ISPs in advance, but Oftel has ruled that in future it must charge in arrears. In addition BT will have to refund ISPs the additional costs incurred by having to pay in advance since the start of FRIACO in May 2000.
David Edmonds, director general of telecommunication for Oftel, said the rule change has been introduced so consumers can 'continue to benefit from competition in the narrowband market.
'To compete effectively with BT where it has market power, operators have to be offered fair and reasonable terms for wholesale products and services, and Oftel will always take action when necessary to ensure that this happens.'
The change will also make it easier for ISPs to manage their costs and, said Edmonds, 'will also bring further future savings to the operators, which they may then pass on to consumers.'
A number of ISPs, including AOL and BT Openworld, have recently increased the price of their unmetered dial-up packages.