Openreach trims leased line costs as business fiber rivals spread

On 25 June 2026 Openreach told communications providers that it will cut two of the charges businesses pay, indirectly, for a dedicated leased line. From 1 August the fixed fee for excess construction charges on Ethernet falls from £708 to £516, and connection charges on Ethernet Access Direct (EAD) circuits of up to 1Gbit/s come down in Area 2 and Area 3, where Ofcom regulates prices most closely. Earlier in the month, Openreach announced a rental discount for customers that re-sign existing circuits for three, five or 10 years.

According to Openreach’s price change notice, the connection charge for a standard EAD 1000 circuit falls from £2,108 to £1,995 in what Ofcom calls Area 3, and to £2,046 in Area 2, excluding VAT. The annual rental stays at £2,442.

For small and mid-sized businesses, which buy leased lines through an IT or communications provider rather than from Openreach itself, the question is whether these moves make dedicated connectivity meaningfully cheaper, or mainly make it harder to leave as business-only fiber networks spread.

What Openreach has changed

Excess construction charges can apply when an Ethernet installation needs extra civil engineering work. Under the approach set by Ofcom, the fixed fee Openreach charges has to reflect the excess construction costs it actually incurs. Those costs fell in 2025–26, so the fee comes down by £192, a cut of about 27%. Openreach says that, having reviewed the fee change and its compliance with the Ethernet basket charge control, it will also reduce EAD connection charges of up to 1Gbit/s in Area 2 and Area 3, with the size of the cut varying by area, according to its briefing to providers.

The re-sign offer, published on 8 June, is aimed at circuits already in place. It applies to EAD lines of up to 1,000Mbit/s that have been held for 36 months or more, across all four parts of the business access market: the Central London Area (CLA), the High Network Reach (HNR) area, Area 2 and Area 3. A provider that re-signs a circuit for a new three-year or five-year term gets a 10% discount on the current one-year rental price and no price rises for the minimum period. A five-plus-five option keeps the 10% discount for the first five years, then allows an exit without penalty or a further five years at a 20% discount, again with no price rises. Applications open on 7 July 2026 and close on 7 January 2027.

The price freeze may be worth more than the discount. The same price notice shows the annual rental on an EAD 1000 circuit rising from £2,358 to £2,442 on 1 April 2026, an increase of about 3.6%. A circuit re-signed at the current rental, less 10%, would be shielded from any such rise for its minimum term.

Why Openreach is moving now

Regulation sets the frame. In its Telecoms Access Review 2026, which took effect on 1 April, Ofcom kept a geographic approach to leased lines, as reported by ISPreview. The Central London Area has been deregulated since 2019. In the HNR area, covering 9% of UK postcode sectors, Openreach must offer fair and reasonable prices. In Area 2, covering 54%, Ofcom continues to set flat, inflation-adjusted price caps on active leased lines. In Area 3, covering 34% and where Ofcom sees little prospect of material competition, Openreach must offer dark fiber priced on its costs, and prices for active services of 1Gbit/s and below are being reduced in line with costs.

That explains the shape of the connection cuts, which are deeper in Area 3. The re-sign offer is different: it reaches into the CLA and HNR areas, where Ofcom finds the most network competition, and it targets lines that have been in place for at least three years.

The rivals are still building. On 24 June, the day before Openreach’s price notice, ITS Technology Group said it would extend its business-focused full fiber network into 13 more towns and cities. Coventry, Huddersfield and Loughborough were due to be ready for service in June, with Aberdeen, Bath, Bournemouth, Cardiff, Chester, Edinburgh, Exeter, Plymouth, Southampton and Swansea following between July and October. Its portfolio, sold through partners, includes FibreLight Plus, an Ethernet over fiber-to-the-premises (FTTP) bundle with symmetrical speeds and burstable bandwidth.

“Partners need more than access to a circuit,” said Daren Baythorpe, chief executive of ITS, in the announcement. The network was said in 2025 to pass more than 465,000 UK businesses, ISPreview reported.

What changes for customers

The installation savings are modest. On a new 1Gbit/s EAD line, the connection cut is £113 in Area 3 and £62 in Area 2 at wholesale prices, plus £192 off the fixed fee where extra construction is needed. Openreach’s charges are wholesale, so whether a business sees any of it depends on its provider’s pricing.

The re-sign offer is worth more, and it asks more. On the current list rental for an EAD 1000 circuit, 10% is about £244 a year before any provider margin. In return, the site commits to a new term of three or five years on a line that has already run for three years or more, with the second half of the five-plus-five option left to the provider’s choice. Ofcom’s next full market review is due in 2031, ISPreview reported.

That trade-off looks different by location. In Area 3, where few alternatives exist and Ofcom expects little to change, a long fixed price is likely to be good value. In the CLA, HNR area and the towns where business-focused networks such as ITS are building, a five-year commitment could cost more than it saves if an Ethernet-over-FTTP service or a rival leased line becomes available at a lower price.

Buyers should do three things before their provider re-signs anything on their behalf. Ask whether the provider plans to take up the offer, and how much of the discount it will pass on. Get at least one competing quote from an alternative network where one serves the site. And time any new order that may need extra civil works for after 1 August, when the lower fixed fee applies.

Taken together, Openreach’s moves reward commitment more than they cut prices. Customers with a choice of network should make any commitment earn its keep.