Ofcom to consider split of BT and Openreach
17 July 2015 |
UK telecoms regulator Ofcom has launched a consultation into whether Openreach should be split from BT.
The regulator confirmed that it has completed the first phase of its strategic review of digital communications and is examining a structural separation of the Openreach division.
The latest proposals are part of a once-in-a-decade strategic review of the industry in the UK. Ofcom’s review in 2005 resulted in the division becoming a separate part of BT. However its rivals such as Sky and TalkTalk have repeatedly called for the split.
Under an initial discussion paper, the regulator said the splitting BT could deliver competition or wider benefits for end users, but it would also be complicated to implement.
“This review is about ensuring people get the best possible communications services, wherever they live and work,” said Sharon White, Ofcom's chief executive. “Our priorities are clear. We want to promote competition, investment and innovation, so that everyone benefits from even better coverage, choice, price and quality of service in years to come.”
According to the regulator, BT’s network has evolved in recent years, with fibre lines running closer to premises. As such this may require different models of competition than those that worked best for the traditional copper telecoms network.
In addition the regulator expressed concerns relating to the quality of Openreach’s services. “Ofcom has been concerned that Openreach’s performance on behalf of providers has too often been poor, requiring the introduction of rules for faster line installations and fault repairs.”
In response, Sky has urged Ofcom to ask the Competition and Markets Authority to conduct a full competition inquiry.
“For too long, consumers and businesses have been suffering because the existing structure does not deliver the innovation, competition and quality of service that they need,” said Mai Fyfield, Sky’s chief strategy officer.