Ofcom "could hand BT new broadband monopoly"

 

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By Barry Collins

Posted on 7 Jul 2008 at 13:03

A leading industry body has warned Ofcom could be on the verge of handing a new broadband monopoly to BT.

Ofcom chief executive Ed Richards said last week that the regulator favoured regulation that "encourages operators to make risky investments" in next-generation fibre networks.

The speech was interpreted as a clear signal to BT, which has long stated that it can't justify investment in a nationwide fibre network if competitors are to be granted unfettered access to it.

However, David Harrington, director of regulatory affairs at The Communications Management Association (CMA) has warned that Ofcom could be playing into BT's hands.

"The most cost-effective way [to roll out fibre] is for council-maintained fibre networks," he claims. "It's called the Balkanisation of the infrastructure."

"The alternative is to hand a new monopoly on a plate to another provider," he told PC Pro, in a clear reference to BT, which is the only telco in the country that could conceivably afford a nationwide fibre deployment.

Harrington insisted that "we're not banging a subjective drum here" and would have no objection to a BT fibre network "as long as there are checks and balances to prevent a new monopoly."

BT says it has no desire to exclude rivals from any fibre network. ""BT has consistently said that all next-generation networks must be open to all players, whether ours or others," the company claims in a statement. "It is therefore incorrect to suggest that BT has ever sought to exclude competitors from its next generation networks "Open access in a fundamental principle that BT believes in and it is one that should be extended."

Harrington was talking in the aftermath of the CMA's new survey, which found that British broadband isn't fast enough for a third of British businesses.

He says the survey was commissioned in response to a report from the Broadband Stakeholder Group, which advised telcos and Government to postpone investment in next-gen networks.

"That was the sole reason for doing this survey - to chip away at the argument there's no identifiable demand for significant broadband investment in the near future," he says.