New BT boss hints at fibre-to-the-home - but not for all

 

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By Barry Collins

Posted on 14 Apr 2008 at 09:55

BT's new chief executive has suggested that the company may be prepared to invest in fibre-to-the-home - provided it's not forced to offer fibre to everyone who wants it.

BT has long dismissed the prospect of nationwide fibre-to-the-home, claiming that it could not justify the multi-billion investment that would vastly improve Britain's broadband performance.

But in a notable softening of the company's stance, the company's new chief suggests the investment might be possible if Ofcom removes the universal service obligation (USO), which forces the former monopoly to offer affordable services to anyone who wants them.

"We want changes to the USO to reflect a fibre world," Ian Livingston, who steps up to the chief executive role in June, told the Sunday Times. "There are 200-odd service providers. Why should all the USO fall on BT Retail?"

And in a thinly-veiled threat to the regulator, Livingston insists the investments remain unjustifiable unless the regulations are changed. "We will not spend material amounts of money that will guarantee that we lose money for shareholders," he says. "It's just not going to happen."

Livingston's comments indicate that the BT boss is only prepared to fibre built-up, metropolitan areas where the cost of laying cable is relatively inexpensive. Virgin Media already offers cable in many major cities, but most rural areas are excluded because of the high cost-per-head of laying fibre in small towns and villages.

Such a move could exacerbate the digital divide, where those living in rural areas are only able to receive vastly slower connections than their
inner-city counterparts.