Ofcom said all major landline providers had increased line rental charges by between 28 percent and 41 percent in recent years, despite the wholesale cost of providing the service falling 25 percent.

Market leader BT (>> BT Group plc) and Virgin Media (>> Liberty Global PLC) had the highest line rental charges, it said, with TalkTalk (>> Talktalk Telecom Group PLC) and Sky (>> SKY PLC) not far behind.

The increases were felt most acutely by customers who did not take advantage of competition in the market for bundling landlines with services such as broadband and pay-TV, it said.

Bundling has become more popular in recent years, with some services such as broadband marketed as free in packages.

"We're particularly concerned for older and vulnerable customers, who rely on their landline and are less likely to change provider," Jonathan Oxley, Ofcom's competition group director, said on Thursday.

"So we're reviewing this market to ensure these customers are protected and getting value for money."

The regulator said it would examine whether measures were needed to protect those customers, and it expected to publish a consultation in early 2017.

(Reporting by Paul Sandle; editing by Kate Holton)