BT landline-only customers to get phone bill discount from Sunday

The regulator investigated rising prices for landline-only services last year, before announcing that BT had agreed to reduce monthly bills for landline-only customers in October.

From 1 April, monthly line rental for landline-only customers would fall by 37%, from £18.99 to £11.99.

The change would save the customers - many of whom Ofcom noted were elderly - £84 a year.

As part of the agreement, BT also agreed cap line rental and call charges to increase by no more than inflation for three years.

The regulator said landline-only customers had not received the same value for money as those who took up bundles of landline, broadband and pay television services.

Two thirds of landline-only purchasers were over 65, and more than three quarters had never switched provider.

Ofcom said its analysis showed that all major landline providers had increased their line rental charges “significantly” in recent years, by between 23% and 47% in real terms.

That was despite them benefitting from a 27% fall in the underlying wholesale cost of providing the service.

Of the UK’s 1.5 million landline-only customers, two thirds were with BT.

That market position had allowed the FTSE 100 telecommunications firm to increase prices without much risk of losing customers, with Ofcom claiming that other providers had followed BT’s lead.

State-owned provider Post Office, which served the second-largest share of the landline-only market after BT, recently confirmed to the regulator that it would be offering a new price of £11.50 from May.

Ofcom said it now wanted to see other providers follow suit.

“We had serious concerns about soaring bills for loyal landline customers,” said Ofcom’s competition group director Jonathan Oxley.

“This was hurting people who rely on their landline, many of whom are elderly.

“We’re pleased that BT has cut prices, which means these customers get a fairer deal, and they’ll be protected from price rises in the coming years.”

Most of BT’s landline-only customers would not need to do anything to benefit from the price cut, which would appear on their next bill automatically.

As the discount was intended to apply to BT landline customers who did not buy broadband from any provider, BT had written to 190,000 of its landline customers who had chosen to receive paperless bills.

It asked them to confirm that they did not have broadband, with customers who confirm that eligible for the price cut.

Ofcom said a further 200,000 customers on BT’s ‘Home Phone Saver’ package could also qualify.

They could choose to stay on their current package, or move to the standard product being discounted, depending on which was the best deal for them.