Share

BT Network Arm Should Have Separate Structure, Says UK Regulator

Instead they would be appointed and removed by BT in consultation with Ofcom.

Advertisement

Ofcom is seeking views on the plans with a closing date for responses of October 4.

Ofcom said Openreach should become a legally separate company from the rest of BT, but remain part of the BT Group.

The regulator is likely to come in for criticism after a select committee of MPs last week said Openreach should be broken up unless BT spent more more money on the service.

“BT has an incentive to make these decisions in the interests of its own retail businesses, rather than BT’s competitors, which can lead to competition problems”. This would allow Openreach to make decisions that depend on investing in, and looking after, Openreach’s assets. In May, the company proposed spending as much as 6 billion pounds ($7.9 billion) on network upgrades, on condition of receiving assurances from regulators that it will be able to make a profit from Openreach. Ofcom reports tomorrow on how Openreach will be run. Sky, Vodafone and TalkTalk have all want Openreach to be separated from BT.

“We’ve announced the biggest shake-up to Openreach in its 10-year history”, she told the BBC’s Today programme.

There should be more choice of broadband networks, including fiber connections to homes and offices.

Furthermore, as a sop to Ofcom, Rake explained that the company is willing to turn over much more control to Openreach as a unit within BT.

Advertisement

“And I think also, crucially for the United Kingdom, it will mean more investment in fast fibre to the doorstep”. “We have the powers, we’re clear we have the powers”. We are concerned that BT’s proposals do not go far enough and think it is right that full structural separation remains an option. The quality of service should be enhanced across the whole industry.

BT's Openreach broadband operation should become a 'distinct company&apos, Ofcom has proposed