In May 2008, we published a consultation document, "A New Pricing Framework for Openreach" (the "First Consultation"). This set out our intention to review certain aspects of the regulatory regime, including the prices of the regulated access network services; certain other access and backhaul services are covered by the separate Leased Line Charge Control review.
The scope of this review included the prices for WLR, MPF and SMPF rentals (the "Core Rental Services") and related services.
In December 2008, we published a range of proposals for modified price controls (the "Second Consultation"). The Second Consultation set out the key assumptions and parameters we proposed would be taken into account in reaching our final conclusions on any new price controls. In particular, we invited views on the methodology and assumptions used in arriving at these proposals. Informed by responses received during this consultation, we are now setting prices for MPF and SMPF. This Statement sets out these prices and the bases for the underlying calculations including our impact assessment.
In response to the Second Consultation, the European Commission recommended that we delay implementation of new WLR prices until the outcome of the ongoing Wholesale Narrowband Market Review is known. In light of this recommendation, we have not determined new prices for WLR at this stage.
If, as we propose in the Wholesale Narrowband Market Review Consultation, we find that there is still a need for WLR price controls, we would expect to set new prices later this year. We will shortly be publishing a consultation document setting out our proposals for these prices. To a significant extent, these will draw upon the analysis summarised in this Statement.
As well as the Core Rental Services, Openreach provides a range of other services, related to the provision of the MPF and SMPF rental services. These are currently subject to price control and/or cost orientation obligations. In the Second Consultation, we proposed that these services should be subject to price controls applied to appropriately defined baskets. This Statement sets out our determination of the appropriate design of these baskets and the related controls.