Broadband prices are set to rise as consumers use increasing amounts of data, the owners of Orange have warned.
Speaking in Paris, France Telecom’s General Secretary Pierre Louette said that increasing demands for faster networks and larger data allowances were resulting from consumers downloading large amounts of video and increasingly playing video games and using video chat online. Although M Louette said that there were no plans for Orange to increase its prices, he added that it was “sure” that the industry as a whole would need to put up prices.
“If you look at what customers are doing online, they’re asking for more data and better networks,” said M. Louette. “That means we need to invest across the industry and if people are using more of a service they will pay more for it.” He cited a report from AT Kearney stating that "modification of retail pricing shcemes is the default option if no decisions are made on creating alternatives".
Broadband prices in France have already have begun to rise. M Louette said that, for instance, data use on mobile phones in Paris in rising at a rate of 5 per cent per week and that similar trends are being replicated in fixed-line broadband. New infrastructure is needed, but increased revenues are not keeping pace with costs.
UK communications regulator Ofcom has prided itself on Britain having broadband that, while not the fastest available in Europe, offers some of the cheapest rates because of a competitive market. In the year to the end of January, however, a survey found that prices rose from £114 per year to £126, a twice the rate of inflation. Commissioned by Ofcom-accredited comparison site broadbandchoices.co.uk, the survey also found that headline speeds rose from an average of 14 mbps to 18mbps

“If you look at what customers are doing online, they’re asking for more data and better networks,” said M. Louette. “That means we need to invest across the industry and if people are using more of a service they will pay more for it.”