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October 8, 2015
On the final day of public submissions to the Ofcom telecoms market review, Vodafone has added its voice to calls for BT to be broken up.
As with similar previous requests from the likes of Sky, Vodafone’s argument focuses on concern for the UK consumer and business, which it fears will have insufficient fixed line connectivity so long as BT controls access to much of the infrastructure. The consistent implication is that Openreach at the very least drags its feet when dealing with BT’s competitors.
“Vodafone today called for a fundamental change to the market in its response to Ofcom’s Strategic Review of Digital Communications,” said Vodafone in a statement. “BT’s Openreach business needs to be structurally separated from the rest of BT and provide access to its ducts and poles to encourage and enable effective multi-operator network investment.
“Only then will UK consumers and businesses have easier access to fibre, which will stimulate the innovation which will not be possible if the UK remains stuck with today’s elderly copper network. If BT is so adamant that Openreach does not provide it with advantages over alternative providers, then why is it so opposed to structural separation?”
Why indeed? BT will no doubt make its own Ofcom submission public before long and it will probably stick closely to the themes in CEO Gavin Patterson’s recent speech, by emphasising how much BT invests in fixed infrastructure and perhaps having a dig at Sky’s pay TV dominance for good measure.
It goes without saying that all the companies clamouring for Openreach to be taken away from BT expect to benefit directly from such a move. Being reliant on a direct competitor to maintain your offering is difficult, but Openreach is pretty heavily regulated, so there’s no guarantee it would perform any better without BT’s direct control.
Ofcom has committed to produce a statement “at the turn of the year” that will outline the priorities and actions that will shape its regulatory approach for the next decade, so we’re unlikely to know the fate of Openreach before then. Ofcom boss Sharon White recently indicated her concerns regarding the BT/EE acquisition and how that may hinder competition to it will be a nervous Q4 for BT.
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As the Editorial Director of Telecoms.com, Scott oversees all editorial activity on the site and also manages the Telecoms.com Intelligence arm, which focuses on analysis and bespoke content.
Scott has been covering the mobile phone and broader technology industries for over ten years. Prior to Telecoms.com Scott was the primary smartphone specialist at industry analyst Strategy Analytics’. Before that Scott was a technology journalist, covering the PC and telecoms sectors from a business perspective.
Follow him @scottbicheno
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