vacancies advertise contact news tip The Vault
facebook rss twitter

Broadband firms protest against BT's monopoly position

by Mark Tyson on 24 November 2014, 13:05

Tags: O2/Telefonica (NYSE:TEF), British Telecom (LON:BT.A)

Quick Link: HEXUS.net/qaclxf

Add to My Vault: x

Over a dozen of UK's biggest telecom companies have united and filed a complaint to media regulator Ofcom against BT for holding 'monopoly' power in the business broadband market, reports Reuters.

The UK Competitive Telecommunications Association (UKCTA) believes that other companies should be able to lay their own cables in BT ducts and use their own equipment to control BT cables, an arrangement known as 'dark fibre'. The trade group considers BT's control of national infrastructure to have blocked competition and restricted innovation, in parts due to Openreach's poor record on responding to new line orders and fixing faults.

The alliance, made up of Britain's biggest telecom service providers including Vodafone, Virgin Media, TalkTalk, Sky and EE, is also accusing the regulator of failing to tackle competition issues in favour of crowd-pleasing consumer measures. The UKCTA said that Ofcom "has now moved from competition to intrusive sector-specific consumer protection measures, often duplicating general consumer protection measures. UKCTA calls on Ofcom to return its focus to championing competition, which will drive innovation and enhance choice and the protection of consumers."

However, in response, Ofcom has rejected the criticisms of its emphasis on consumers, saying: "We make no apology for protecting consumers... that work goes hand-in-hand with promoting competition."Furthermore, Ofcom asserts that "The UK already has the most competitive broadband market of any major European country. Our job is to ensure that customers benefit not only from innovation, but also from good quality of service and a fair deal."

The group plans to call on Ofcom to hold BT's infrastructure arm, Openreach, to high standards, as they argue that although the legal separation of Openreach has delivered falling prices and rising speeds for consumers, BT was still allowed to restrict competition in the business market.

A BT spokesperson said in a statement that forcing Openreach to open up access to BT ducts (or dark fibre) would "increase costs and add extra complexity to the way UK businesses are served." The spokesman describes the UK as a "vibrant wholesale business connectivity market" and adds that recent Ofcom data "clearly shows growing competition, which if anything supports the case for further deregulation."

Telefonica plans to sell O2 to BT?

A separate Reuters report today suggests that Spain's Telefonica is currently in talks to sell its UK mobile operator O2 to BT in return for a 20 per cent stake in BT as part of a "strategic alliance" to reinforce the pair's businesses. "According to various sources, the talks between Telefonica and British Telecom are advanced although no final deal has been reached," said in a report by Spanish website El Confidencial.

BT demerged O2, then Cellnet, in 2005, to help pay off debts. Then it sold O2, raking in £17.7bn from Telefonica. Today, the reported 20 per cent stake in BT on offer in the deal is said to be worth roughly £10bn.



HEXUS Forums :: 25 Comments

Login with Forum Account

Don't have an account? Register today!
Doesn't this happen every year?

TBH, I'd be happy if they just stopped BT forcing ridiculously over-priced landlines on us that we don't even use.

Also, do BT have a monopoly on installing trunking? It seems a tad odd that they feel entitled to use the stuff BT has installed, rather then installing their own……..or if that was government subsidised then someone needs to take the fall for not putting a proviso in place to stop BT blocking others from using infrastructure paid for (or subsidised) by tax-payer money.
shaithis
TBH, I'd be happy if they just stopped BT forcing ridiculously over-priced landlines on us that we don't even use.
But don't all the companies do this? To be honest the only use that the fixed line that Virgin “forced” me into having is to receive those spam calls. And, at the moment, quite a lot of those vocal malware “we are working with the windows, and your computer has a problem” calls.
shaithis
Also, do BT have a monopoly on installing trunking? It seems a tad odd that they feel entitled to use the stuff BT has installed, rather then installing their own……..or if that was government subsidised then someone needs to take the fall for not putting a proviso in place to stop BT blocking others from using infrastructure paid for (or subsidised) by tax-payer money.
I was pretty sure that Virgin installs their own routing and boxes, etc, (mainly because of the faults in our local VM box). If the “national” infrastructure hasn't been nationalised then maybe there's strong arguments for doing so … strategic resource, encouragement of competition, etc.

However, I'm cynical enough to think that this trade body's press release was more about wailing on Ofcom to leave them to squeeze more money for nowt out of the consumers, and - in the case of Sky and TalkTalk - wanting to gain zero cost access to BT's lovely wires.

The Telefonica deal doesn't surprise me, others have commented that O2 push seems to have been a little lacklustre of late - almost as if they were waiting for something. Nostalgia hit though, since my first mobile was a Motorola analog one on Cellnet … or as it was called “BT/Cellnet”, heck I even bought it from the local BT shop!
crossy
But don't all the companies do this?
All but Virgin, I assumed it was because BT will not allow broadband lines without a full-fat landline subscription. I can't even see anyway to get one of those old “incoming calls only” lines or the cheaper tarrif with huge call costs (being forced to pay £17/month for a line I NEVER use is a complete insult, especially when broadband is now a human right….)

crossy
I was pretty sure that Virgin installs their own routing and boxes, etc,
Virgin bought some old infrastructure years ago (rediffusion?) and revamped it, hence they have their own (mostly)
shaithis
All but Virgin, I assumed it was because BT will not allow broadband lines without a full-fat landline subscription. I can't even see anyway to get one of those old “incoming calls only” lines or the cheaper tarrif with huge call costs (being forced to pay £17/month for a line I NEVER use is a complete insult, especially when broadband is now a human right….)


Virgin bought some old infrastructure years ago (rediffusion?) and revamped it, hence they have their own (mostly)

I'm sure they could do a landline that only worked with adsl. However, it'd probably cost the same as than one that did! The infrastructure costs would be the same but it might cost them 50p a quarter to send you a bill!
the only answer to this is to split bt from openreach,
so far all companies have access to the copperwires between xchange and home but at “cost” rate, as long as profits are shuffled around to make it look like the local lines are costing more to run than they actually are bt will always win at the cost of the customers.