Tiscali ups the anti-BT complaints ante

By Matt Whipp

Posted on 18 Jun 2003 at 12:03

Tiscali and other communications companies are to drop a complaint against BT made under the Telecommunications Act and relodge it under the more powerful Competition Act.

The complaint, from Tiscali, Energis and Your Communications, claims that BT is using its monopolistic weight to unfairly penalise those communications providers that took up its Datastream broadband service by 'multiple tactics', such as cutting the prices of its preferred broadband wholesale offerings.

The trio will be hoping to follow in the footsteps of Freeserve, who successfully managed to force Oftel to reconsider a complaint of predatory pricing by taking the complaint to the Competition Commission Appeals Tribunal.

The companies are hoping that, by relodging the complaint under the Competition Act, Oftel will be forced to consider its complaint in a more timely manner and avoid it languishing in the regulator's hands until the damage is done.

Tiscali's CEO Sergio Cellini: 'Since we are firmly confident of our rights and position, we have therefore decided - with the other major players in the industry - to attack this Margin Squeeze through the Competition Act which gives us the opportunity if necessary to further appeal through the Competition Appeals Tribunal and claim damages. If we had waited for the formal ruling on our complaints under the Telecommunications Act, we would be in a weaker position.'

The Datastream service allows companies that own their own networks to take broadband traffic straight onto their networks, allowing them to offer a greater range of broadband products to customers and greater freedom in pricing than those ISPs tied to IPstream offerings.

The Datastream option was forced upon BT by Oftel, the telecomms regulator, in order to promote a more competitive broadband market, but when BT recently applied a series of price cuts to what it marketed as being across 'broadband', the cuts only applied to IPstream products - those broadband offerings that exist entirely on BT's networks and essentially sold on by ISPs to consumers.

BT's Datastream customers recently won a 70p price cut on the service, but BT had only acted with the minimum amount that would prevent Oftel from forcing its hand anyway. Cellini commented: 'We have been working well with Oftel and the price reduction they have been able to achieve confirms this. However, we are not expecting now that Oftel will push the matter much further and quickly enough to impose a level-playing field before the game is over... Without a viable and competitive DataStream product, BT resumes its position as a monopoly in the broadband market - which is a disaster for the industry, businesses and the consumer.'