OFCOM LAUNCHES FORMAL CONSULTATIO ON BREAK UP OF BT

Communications regulator Ofcom has opened a consultation into whether parts of BT Group should be split off from the company.

The regulator said one option was to split off BT's Openreach service into a separate company.

Most internet service providers offer services through a fixed-line network controlled and maintained by BT.

But Ofcom said it had concerns BT Openreach's performance on behalf of those providers had often been poor.

I certainly think BT Openreach should be spun off from BT Group and I've said it before.

But there will be much opposition from fans (and possibly shareholders) of BT Group who will see it as a weakening of their empire.

It could only be a good thing.

The Ofcom announcement.

It does cover quite a lot more, as no doubt you know but others may find it interesting. Such as the babble about mobile and also TV streaming.

For the masochists, the full discussion document. A hundred and eighty-five pages on their initial thoughts.

In reply to a post by RobertoS:

It could only be a good thing.

Many said that about Network Rail

Before anybody starts to tinker with the present arrangement/system/call it what you will, it should be borne in mind that Ofcom has long been able to demand improvements where they have been needed. That it is complaining about the present situation is an indication that it has failed in this task.

Knowing as we do the long list of abject failure in introducing new systems and regulators I for one am sure that any alteration of the present system would be accompanied by a period, long or short, of complete chaos and confusion to the detriment of customers large and small

The current arrangements may not be perfect but if one considers the progress that has been made there is much merit in tweaking rather than embarking on empire demolishing followed by, probably, much wasting of money, most of which would have to be found by the customer

I for one have gone, in a very rural location, from a noisy old voice line via 28kbps dial up to fast fibre broadband in little over 10 years. Much (most?) of the UK has done much the same. That's not bad going in my estimation, and so far as I see the progress continues

It may not be perfect, but be careful what you wish for

In reply to a post by RobertoS:

It could only be a good thing.

Agreed I've often said as much.

My main concern is where the investment would come from for continued improvements. And, as 961a wrote I don't actually think Openreach has done a particularly bad job. It (or its descendant) could certainly have done a lot worse. Truth is for all the whining the UK's per capita internet use is amongst the highest in the world and has been for a long time. Whatever you might think about connection speeds they are clearly very fit for purpose.

The main areas I think need addressing are: End-user accountability. The current game of secret squirrels (User->ISP->[Wholesale->]Openreach often causes problems. It'd be far better if we could report faults direct to Openreach. Timescales is the other issue but again if customers could talk to OR direct it'd be that bit harder for them to faff around.

Edited by Andrue (Thu 16-Jul-15 13:47:45)

I doubt if we'll ever had direct user-accountability from Openreach however it is owned. It would be like being able to complain to the manufacturer of supermarket own-brand baked beans if there was something wrong with one you have bought.

In reply to a post by Andrue:

My main concern is where the investment would come from for continued improvements.

This is a concern in my view.

My electric distribution company is Chinese owned. My gas distribution company is 50% owned by a foreign pension fund. My water company is owned by a foreign pension fund.

BT Group put £2.5Billion into Fibre broadband on a long payback during a very deep recession. I can't see a demerged Openreach being independent for long and I don't think the pension funds or foreign owners would put up the money.

In reply to a post by Andrue:

The main areas I think need addressing are: End-user accountability. The current game of secret squirrels (User->ISP->[Wholesale->]Openreach often causes problems. It'd be far better if we could report faults direct to Openreach. Timescales is the other issue but again if customers could talk to OR direct it'd be that bit harder for them to faff around.

There is absolutely no chance of this happening. The market was set up this way deliberately. Punters are free to choose between good and bad providers. The idea is that if you get bad provider, you move to a good one rather than trying to bypass their customer service.

Edited by deleted (Thu 16-Jul-15 14:27:55)

WHY ARE YOU SHOUTING?



I'll believe it when I see it.

In reply to a post by RobertoS:

It could only be a good thing.

Demerging Openreach and it probably being in the hands of a foreign pension fund or Far East firm soon after, is probably a bad thing in the whole.

However i can see some positive stuff for BT Group. For example, Openreach have to give preferential treatment to LLU providers for repair service. I don't think that would be allowed anymore.

Similarly, only BT Consumer have to fund Openreach staff pension deficit. Under a demerger, the other players would have to cough up through prices that reflect the deficit.

Lastly, shareholders may do alright out of it. The shares have not bombed today.