OFCOM orders BT to legally separate from Openreach
Telecoms regulator OFCOM has started legal proceedings to force separation of Openreach from BT.
OFCOM decided to push ahead for the split after “BT failed to offer voluntary proposals that address our competition concerns”.
The regulator said it was “disappointed that BT has not yet come forward with proposals that meet our competition concerns”. “Although we have made some progress, BT has so far failed to offer proposals that would adequately address our concerns. BT’s proposals still fall short in important areas. These include the transfer of people and assets, and the level of influence that BT Group executives could exert over the management of Openreach.”
In response, BT said: “We put forward proposals in July that we believe are fair and sustainable, and that meet Ofcom’s objectives without disproportionate costs. We are implementing these proposals, and have just appointed Mike McTighe to be the first chairman of Openreach. We are in discussions with Ofcom on two outstanding issues, the reporting line of the Openreach CEO and the form of legal incorporation.
“We will continue to work with OFCOM to reach a voluntary settlement that is good for customers, shareholders, employees, pensioners and investment in the UK’s digital future.”
Although OFCOM stated that it is still open to receive further voluntary proposals from BT, it has already started discussions with the EC and wants to move quickly in getting a decision from the Commission. “Creating a more independent Openreach – which works in the interest of all providers, not just BT – is an important part of achieving this,” OFCOM.
At Opus we believe that this is the beginning of a major transformation in the UK’s telecoms industry. Anyone who has had a leased line installed will know how painful Openreach delays can be. With access to Openreach’s ducts and poles, many connectivity providers will now have the ability to deliver better service with their own unique broadband and connectivity products without being constrained by Openreach’s limitations.