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A regulatory change from Ofcom could allow BT to offer more competitively priced quad play packages, potentially resulting in a slew of better deals for consumers.

The telecommunications watchdog is proposing to lift restrictions which prevent BT from selling certain elements of quad play deals at a loss. This rule is in place to prevent BT gaining an unfair advantage over rivals through its dominant postion in the home phone market. The regulator is now soliciting responses to its suggestions for reform in a consultation.

BT has consistently claimed that the restrictions are unneccessary due to the level of competition now evident in the UK broadband market.

Industry figures are now predicting that any relaxation of the rules could prompt a quad play price war that would hugely benefit consumers.

A BT spokesman said: "This is great news for consumers and businesses alike. This deregulation means that BT will be competing on a more level playing field with other communications providers, which ultimately will mean more attractive packages and deals for customers."

Rival internet service providers (ISPs) have yet to respond publicly to the news, but the proposals are unlikely to be given a warm reception. This is especially true given Ofcom’s other recent landmark decision to scrap caps on the fee that BT can charge the competition to use its telephone networks. Many companies have been vociferous in their opposition to this change on the grounds that their operating costs would be likely to increase dramatically at a time when balance sheets are already under strain.

Virgin and BSkyB were among the first companies to offer quad play deals, which typically include fixed-line voice calling, mobile phone, broadband internet access and television in a money-saving package. However, BT's quad play deals would substitute line rental for the mobile telephony facet of deals.

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