BT Openreach

Today Ofcom announced that it is ordering the legal separation of Openreach from BT after BT ‘failed to offer voluntary proposals that address [their] competition concerns.’

The telecoms regulator’s aim to separate the two organisations is a move for a more independent Openreach in order to provide ‘regulatory clarity and confidence to the industry, and ultimately better outcomes for people and businesses.’

Here’s what some experts in the telecoms field have to say:

Mark Skilton, a professor of practice at Warwick Business School and an expert on telecoms and IoT, states:

“The BT Group argue they are investing in this critical national infrastructure powering the digital economy for all industries, yet questions over how to build this faster and with more coverage across the nation have been part of a constant battle.

“The Internet of Things, super-fast broadband, 5G and other types of networks may be better delivered and served with having multiple large scale companies in a more devolved network.

“This requires a huge investment to build fibre networks, but also a willingness to experiment and develop a full range of services that digitise and enable multiple networks and providers to give not just access but also high performing data and network speeds.

“Separating the BT and Openreach monopoly will in my view help this move towards a faster network of providers and hence one that is not driven at the speed of one large operator’s priorities. This has counter arguments of reliability and avoiding vested interests in zoning in on specific cities and regions for preferential treatment. But with Ofcom and government leadership now so critical in the Brexit era we now find ourselves in, we need to think faster and more nationally and internationally in how we connect to the wider world.

“The telecoms network has to be the network of the future and this needs big investment from many parties not just the preserve of one.”

Dave Millett of Equinox says:

“In my view this does not go far enough because BT will still presumably supply the money for the investment into Openreach – so who holds the purse strings? If it’s still BT, which is what it appears to be, then they still hold the power. So, this new ‘legal entity’ means very little and will produce very little change.  It also appears that Openreach will not be answerable to the public. So again, no change from the current situation. And finally, who appoints the board? Again, BT.  So just what sort of a split is this?

“This is against a backdrop of the UK lagging Europe in terms of availability of fibre to the home, the fact that many small businesses have no access to fast broadband and from our own experience many rural areas have effectively no broadband whatsoever. Overall when will Ofcom realise that BT will do anything to slow down the process and inhibit the freedoms of other suppliers? And why don’t Ofcom do what they should have done all along and totally split them off into two completely separate companies – with no overlaps.”

But what does the split mean for consumers?

Andrew Ferguson, editor of thinkbroadband.com commented:

“Those with poor broadband may think that today’s news is an early Christmas present, but we would caution that it is too early to celebrate if you are living or working in one of the 2.3 million properties without access to a superfast broadband option today.

“Recruitment of many more new frontline staff is the key to good customer service, to ensure that jobs are not micro managed to the second but are dealt with as a problem to be solved. The downside of more staff and better customer service may be higher costs, so to deliver on what many expect may mean price rises for all of us.

“In terms of a change of direction from the technology view point, existing BDUK commitments are so time constrained that the fibre to the cabinet roll-outs are not going to change. The big difference is likely to happen in areas where the Openreach network competes with companies like Virgin Media, especially as these are the areas Sky and TalkTalk appear keen to offer an Internet TV service.”