BT extends peace offering to Ofcom

4 Feb 2005

In a bid to resolve its ongoing dispute with the industry regulator Ofcom, BT has published new proposals to ensure that alternative operators are offered equal access to its network. Responding to the second stage of Ofcom’s strategic review of the UK telecoms industry (SRT), the incumbent is also promising faster broadband services, lower wholesale prices and highly regulated access to its local network. In the SRT, the watchdog called for a sea change in cultural and behavioural activity from BT and threatened an investigation by the Competition Commission and even possible break-up of the incumbent if it failed to comply. However, in a document released yesterday the former monopoly has set out new plans under which it will reorganise itself and create a new business unit, called Access Service, to deliver many of the requested changes.

BT says that the new Access Service division will be responsible for providing transparent and equal access to the local loop, without it having to go through the ‘pain and cost’ of a break-up, which it claims will adversely impact the entire industry. The company’s CEO Ben Verwaayen said the proposals represent a dramatic change in thinking for the sector and would ‘give companies the certainty they need to invest in their businesses.’ BT accepts that the new division will be highly regulated but hopes its acquiescence over local loop unbundling will help it in its efforts to strike a deal with Ofcom over freeing up regulation in other parts of its business.

United Kingdom, BT Group (incl. Openreach), Ofcom