UK’s communications regulator, Ofcom has said that it will reduce the prices that BT Wholesale can charge other Internet Service Providers (ISPs) in less populated areas.

The move could benefit millions of rural homes and businesses as they might receive cheaper broadband services from ISPs using BT Wholesale’s network infrastructure. The regulator has ruled that BT must reduce its charge to ISPs each year, by a rate of at least 12 percentage points below inflation.

The ruling will be in affect from by mid-August 2011 and remain in force until 31 March 2014. Parts of Scotland, Wales and Northern Ireland as well as Norfolk, Yorkshire, Cumbria, Northumberland, the south-west of England and other areas are expected to benefit from the reduction in price.

Ofcom said that the ruling will lead to either cheaper or better quality services. The regulator aims to bring down the gap between price paid by broadband users in rural and urban areas.