Telecoms giant BT has slashed the wholesale price of broadband access for its rival providers.
BT said the move would boost competition and promote lighter regulation.
The decision, however, is clearly designed to pre-empt any cuts forced on BT by industry regulator Ofcom which has been highly critical of the former state telecoms operator.
Last month Ofcom chief executive Stephen Carter attacked the telecoms giant for overcharging its rivals.
They argue BT's pricing policy prevents the growth of internet broadband in the UK.
BT chief executive Ben Verwaayen said the company shared Ofcom's view that "competition based at the infrastructure level will be good for everyone and for the UK in general."
The cuts take effect on 1 June. The initial reduction represents an overall saving of 35% on current wholesale prices. Further cuts, taking the total reduction to 70%, are expected once volumes pick up.
Consumers will be watching with interest to see if the price cuts are passed on to them.
Data sourced from: BBC Online Business News (UK); additional content by WARC staff