Ofcom Pauses Split of Openreach From BT, Instructs To Ensure Universal Broadband right

By Staff Writer

Feb 26, 2016 07:54 AM EST

Ofcom, the UK communications watchdog, has recommended that BT, country's telecom giant, must open up its cable network. The regulator has also stopped a complete breakup of BT for the time being while considering the split as an option.

BT has been recommended to help rivals to allow using its infrastructure to lay fibre cables alongside existing copper network infrastructure. Ofcom has also suggested maintaining control over its wholesale broadband unit, Openreach. Citing Ofcom adopted measures inadequate, the review recommendations have drawn criticism from TalkTalk and Sky, reports The Guardian.

The UK telecom giant has welcomed the report agreeing to let other companies using its network subject to their investment keenness. Ofcom acknowledges the digital division in the UK on the basis of having latest technologies. To omit the division, the regulator has proposed for making decent, affordable broadband as a universal right, reports BBC.

Ofcom has been urged by rival operators including Sky, TalkTalk and Vodafone to recommend for complete split of Openreach from BT. These operators along with hundreds of other service providers purchase access from Openreach's last mile network, according to a report published in Fierce Telecom.

Companies such as Sky, Vodafoe and TalkTalk accuse BT for underinvestment in Openreach leading to poor service with interruptions and slow speeds. Now BT will allow easier access for rivals to set up their own fiber cables along Openreach's telegraph poles and in its underground cable ducts.

The UK telecom regulator intends to introduce tougher rules on BT's faults, repairs and installations. It expects, Openreach to be governed at arm's length of BT with greater independence in taking its own decisions on budget, investment and strategy.

Openreach requires major reform and independence to respond to all customers, observes Sharon White, Chief Executive of Ofcom. The regulator even warns that if responsiveness from Openreach to customers remains as earlier, it reserves the right to split BT and Openreach.

However, BT still remains a monopoly provider with a regulated business running at a 28% profit margin, cites a Vodafone spokesperson. He urges Ofcom to ensure BT reinvests the £4bn in excess profits Openreach has generated over the last decade in bringing fibre to millions across the country.

BT, the largest telecom operator in the UK, has been instructed by the Ofcom, country's telecom regulator to let the rivals using its infrastructure. At the same time, the regulator has postponed at least for the time being, the split process of Openreach from BT. However, the industry competitors have urged Ofcom to become more proactive in ensuring a universal broadband for all.

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