BT gets reprieve, but still has to share broadband network

Telecoms giant instructed by European Commission to open up to competitors

4 June 2010 14:22 GMT / By Ben Crompton

British Telecom has seen a 4-year reprieve to the physical unbundling of its broadband infrastructure in Ofcom's latest decision regarding the future of super-fast broadband.

Possibly seen as a compromise, the telecoms giant will have more control over its broadband network than it currently does over its copper network; as rival companies will only have access to new broadband infrastructure via Virtual Unbundled Local Access.

Neelie Kroes, competition commissioner said: "In this specific instance, virtual unbundling seems the best option to safeguard competition and enable consumers to benefit from a wider range of services provided over next generation fibre infrastructure".

Basically, this means that BT will retain power at the exchange (with all the advantages of setting pricing; Ofcom will not restrict the prices BT is able to charge competitors), whilst competitors will gain access to the customers line.

BT is investing about £2.5 billion in its new broadband network over the next 5 years, which should end up reaching two-thirds of British homes. If Ofcom has its way a physical unbundling of the fibre optic network should follow in the next 4 years.

Via: ft.com

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Software, Broadband, BT, Biz, Digital Britain