I know, although it was slightly before my time. It is this expectation that making something state owned will suddenly mean it will spend money to make everything right for people - it is more likely less money would be spent and we probably wouldn't have anything near what we have now.

OpenReach doesn't have to be fully taken over. As I recall, back in the day, BP was 51% owned by the government with the rest being privately owned and it didn't appear to inhibit BP's operations. Don't see why the same couldn't be done with Openreach.

At least the government/taxpayer would receive a dividend payment on that part of the company it owned.

In reply to a post by ian72:

I know, although it was slightly before my time.

It was well within mine� I lived in Newbury and until the early/mid 1970's when you wanted to make a phone call you lifted the receiver and waited for the operator to take the number and connect you.

The white heat of technology hit a big bucket of cold water when it came up against the GPO

And where would the Billions come from to buy the shares? They Government could always borrow it at around 5 or 6% interest and get a 1or 2% return on the investment!

That is the easiest question I've had in a while... HS2.

Edited by deleted (Fri 29-Nov-13 09:42:13)

HS2 does not have any money - it will be funded by loans at 5 to 6% interest. So, the question still stands.

In reply to a post by MHC:

And where would the Billions come from to buy the shares? They Government could always borrow it at around 5 or 6% interest and get a 1or 2% return on the investment!

Fair point, but I don't think the dividend on BT shares is that low although I agree there may be some dilution due to a greater number of shares. It probably depends on exactly how you do it. If you include externalities - greater spread of broadband with greater business efficiency, fibre to the home - then whilst the monetary returns might not be great, the overall benefit to the economy would make up for it. Current funding pushed through BDUK seems inefficient - doing it via a part nationalisation might be a better way.

Edited by Tacitus (Fri 29-Nov-13 11:05:42)

just look at how tightly regulated Openreach's costs are. Most of BTs real profit comes from business comms and not residential or OR activities.

In reply to a post by MHC:

They Government could always borrow it at around 5 or 6% interest and get a 1or 2% return on the investment!

What?

http://www.bloomberg.com/markets/rates-bonds/governm...

Could always have the BoE print it. Isn't like they haven't monetised 350bln of gilts already or anything.

Internet communications has joined energy, rail etc as one of the many markets that the UK government has broken. The older I get the more cynical I get... it seems government just set these markets up to benefit their mates in large companies. Why else would they continue to engage with BT? BT, like most large companies these days, is run by bean counters who care about cutting costs to get to their next quarterly statement with something positive to say. They don't even care about building a larger, more robust business, innovative technologies or anything like that, they just want to keep the pension funds that invest in their shares happy and their CxOs in nice big bonuses.

It is possible for new entrants to build their own network; look at what Google is doing in the States. They are decimating the incumbents in the few locations they have entered (Kansas... not sure if they've gone elsewhere).

The trouble is this requires massive infrastructure investment and as the government would rather spend some money on a few train sets rather than a 21st century telecommunications network (FTTC is a pitiful enough attempt to appease the masses) we're going to slip further and further behind. The government *could* do something by investing for the future and actually opening a *real* market to *many* competitors, but it would rather just hand taxpayer cash to BT.

Maybe the only sensible thing to do is hedge it by purchasing BT, British Gas, npower et al shares... That said I could've said the same thing about Railtrack!