BT must separate Openreach: Ofcom - TechCentral

BT must separate Openreach: Ofcom

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BT Group should be permitted to retain ownership of the UK’s main broadband network, but it needs to give rivals better access to it, regulator Ofcom said.

Ofcom called on BT, the UK’s former telecommunications monopoly, to set up a legally separate entity for the network unit within BT, with its own board, but stopped short of seeking a breakup, according to a statement released on Tuesday.

The recommendation follows complaints from competitors such as Sky and Vodafone, which say BT’s control of the network hampers their ability to serve customers.

The regulator’s recommendation, the latest stage in a review of digital communications in the UK, builds on a decision in February. At that time, Ofcom ordered BT to give competitors physical access to its telephone poles and underground tunnels and to let rivals take direct control of connections.

BT CEO Gavin Patterson has said that the network unit, called Openreach, is already one of the most heavily regulated businesses in the world and that the company has volunteered to accept tighter regulation to bring matters to a “clear and speedy conclusion”.

In May, the company proposed spending as much as £6bn (R112bn) on network upgrades, on condition of receiving assurances from regulators that it will be able to make a profit from Openreach.

The same month, chief executive officers of BT rivals published a proposal for Openreach, calling for the creation of a separate company, financially and legally independent of BT.  — (c) 2016 Bloomberg LP

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