Wednesday, January 18, 2006

BT: We weren't forced to play fair

BT: We weren't forced to play fair: "Telecoms convergence is a real opportunity for all and not just so much BS, says BT, as it launches its access services division"

Telecoms convergence is a real opportunity for all and not just so much BS, says BT, as it launches its access services division

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BT launched its Openreach access division on Wednesday with a bullish denial that it had been forced into the move because of pressure from regulators and rivals.

Openreach, which will maintain BT's telecoms infrastructure, must ensure that all the UK's communications providers get equal, fair access to BT's network. BT offered to create Openreach last year after Ofcom threatened the company with the possibility of break-up unless it gave its rivals the same access to its wholesale network, at the same price, as BT's own retail arm.

But Openreach chief executive Steve Robertson insisted that the division had been created because of the fundamental changes that are taking place in the industry, rather than because of BT's misdeeds.

"I'm always asked by people whether it's true that we were forced to do this [by Ofcom], but I believe this was an inevitable consequence of what was happening in industry," said Robertson. "I'm not here today because someone dragged me here to say we should do something for those service providers."

In response, one communications provider who declined to be named was adamant that the catalyst behind Openreach was Ofcom's Strategic Review, in which the regulator warned that it wouldn't tolerate BT hampering competition in the telecoms sector: "BT may think that the formation of Openreach was inevitable but would they really have done it had they not been legally obliged to do so? That's hard to visualise."

The UK Competitive Telecommunications Association (UKCTA), a body made up of several of BT's rivals, agreed that the Strategic Review was crucial.

"BT had three options. Do nothing, which was pretty rapidly discounted; put something like Openreach in place to create the structural separation that Ofcom was looking for; or go down the Enterprise Act route," said Christine Roberts, UKCTA's director of external affairs. An Enterprise Act investigation could have resulted in BT being split into separate companies.

Roberts said that UKCTA will be watching Openreach closely over the next few months to see if it delivers on its promise to create a level playing field for all operators.

"We have got an organisation in place that we can interface with. Now it's down to the detail about how Openreach works with other operators, and other parts of BT," Roberts added.

Robertson also urged his audience of industry representatives and BT staff not to miss the chance to deliver converged services, citing BSkyB's announcement on Tuesday that it will soon start delivering films over broadband as an example of an innovative offering.

"We've been through the Internet bubble, but money is back on the table. We have a great chance to grasp this opportunity, and that's what Openreach is all about... we're not here today because of management bullshit, we're here because that's what's influencing your business plans and changing the world," explained Robertson.

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