Opening Up the Local Loop to Competition

The biggest impediment to improving the roll out of Fast Broadband is that each of the two players guard their local loop like the crown jewels and do their best to keep the competition out. To date Virgin has managed to keep the doors to competition firmly closed whilst BT has had the door gently prised open to limited competition
The real answer would be to have both local loop owned by a single company as the underground plant is the key to getting better broadband coverage given that this is unlikely the next best option is to have BT & Virgin move the ownership of the underground plant to separate wholly owned subsidiary companies. These two companies will not supply end uses so any conflict of interest has gone & BT & Virgin cannot favour their own customers because they are just shareholders of the companies. So both BT and Virgin would just be customers of these companies in the same manner as any other ISP or Telco. These two new local companies then don’t care who uses their local loop it’s a case of the more that use it the more money they make

Are you aware that Openreach does not supply to the end user already, and simply deal with the communications providers?

With BT and Virgin being the two biggest companies this 'new' company would still simply serve their needs, i.e. biggest provider of revenue would have biggest say.

Openreach is already in the situation where the more loop it has out there the more it gets paid, alas the costs of upgrading to fibre or in VM's case rolling out more Docsis is not cheap. The money to do this comes from shareholders, how much can they invest?

Yes but there is no real seperation between BT & BT Openreach. BT Openreach is just an internall business unit of BT which gives pllenty of scope to organise things to favour their own internal busineess units having a seperate company largely removes that conflict. It is very limited as to how BT could then influencve it as it has its own board and own set of accounts & p&l

Please can I have half of your garden? I know you have paid for it, but as you are not using it for growing profitable crops, I would like to take it over and use it to cultivate my own crop of cannabis plants.

Define real seperation?

To create the total seperation people want would probably cause untold upheaval

In reply to a post by Bob_s2:

Yes but there is no real seperation between BT & BT Openreach. BT Openreach is just an internall business unit of BT which gives pllenty of scope to organise things to favour their own internal busineess units having a seperate company largely removes that conflict. It is very limited as to how BT could then influencve it as it has its own board and own set of accounts & p&l

Utter tosh.

If for one minuite, the other teleco's, isp's, ofcom, thought that there was a problem, then ofcom would be down on BT like a ton of bricks.

In reply to a post by Bob_s2:

Yes but there is no real seperation between BT & BT Openreach. BT Openreach is just an internall business unit of BT which gives pllenty of scope to organise things to favour their own internal busineess units having a seperate company largely removes that conflict. It is very limited as to how BT could then influencve it as it has its own board and own set of accounts & p&l

No, it would still have considerable influence because BT Wholesale would still be the biggest customer.

The only way to achieve what the OP wants would be to make the access network companies completely separate entitiies and not subsids of the parents.

Virgin Media does not have SMP so there is little Ofcom could do there - except argue that they do have SMP I suppose!

Futhermore, even separating Openreach out such that it is not even a subsid of BT would not, in my view, really work as it would still be a dominant operator and is already showing worrying signs (via FTTC) of a desire to become more vertically integrated.

The only way to achieve what the OP wants would be to make the access network companies completely separate entitiies and not subsids of the parents.

As IgnitionNet says, that wouldn't make much difference.

The de-merged Openreach would still be a de facto monopoly, as if VM had any aspirations to significant expansion they would have started long ago, and it would still, in fact probably even more so than now, quite legitimately give huge weight to the wishes and desires of its largest two customers, BT Wholesale and TalkTalk.

In reply to a post by Bob_s2:

The biggest impediment to improving the roll out of Fast Broadband is that each of the two players guard their local loop like the crown jewels and do their best to keep the competition out.

"Their" being the key word here.

Its Virgin and BT's property, no-one else's.

There's a multitude of issues with your proposal.

1) How can you force any private company to sell what they own?
2) Who would buy the combined BT and Virgin infrastructure, the government?
3) Who could afford to buy the combined BT and Virgin infrastructure?
4) Should this even be possible, who would still be the biggest customers of this company. BT and Virgin..... (re your influence issue)

Its like saying... the biggest impediment to improving the mail and parcel distribution service in the UK is to make the Royal Mail sell all of their post boxes and distribution depots to another company and let UPS/TNT/<insert courier here> all use them

Why? Its Royal Mail property, who has any right to make them sell it? Same with Virgin & BT