MP-led ‘Broadbad’ report calls for BT to sell off Openreach

25 Jan 2016

British fixed line incumbent BT is facing fresh calls for it to sell infrastructure arm Openreach due to poor performance, according to the BBC. The suggestions have come on the back of a report backed entitled ‘Broadbad’, which has been published by the British Infrastructure Group (BIG), a collection of 121 cross-party Members of Parliament, led by former Conservative Party chairman Grant Shapps.

The report claims that, despite some GBP1.7 billion of taxpayers’ money having been used to subsidise the construction of UK high-speed broadband, around 5.7 million people across the country still cannot access the internet at regulator Ofcom’s ‘acceptable’ minimum downlink speed of 10Mbps. Further, some 42% of SMEs report problems with their internet connections, at an estimated cost of GBP11 billion to the British economy.

With the report arguing that Openreach should be sold off to increase competition, Mr Shapps commented: ‘We need to start converting to a fully fibre network so we are not left behind the other nations who are rushing to embrace digital advancement. However, we will only achieve this by taking action to open up the sector. Given all the delays and missed deadlines, we believe that only a formal separation of BT from Openreach, combined with fresh competition and a concerted ambition to deliver will now create the broadband service that our constituents and businesses so rightly demand.’ Unsurprisingly perhaps, BT chief executive Gavin Patterson has argued against the sell-off, claiming that if it were forced to do so this would ‘create huge uncertainty and create a weaker company that ultimately could be vulnerable to takeover’.

United Kingdom, BT Group (incl. Openreach)