Telecoms managers blast Oftel

To paraphrase Shakespeare: "Something is rotten in the state of competition". This is the kind of fighting talk that members of the Communications Managers Association (CMA) can expect to hear from the chairman of their new look organisation at its annual conference in Brighton this week.

After 42 years of being the Telecommunications Manager's Association (TMA), the body which fights the good fight on behalf of telecoms staff everywhere, has finally caught up with the idea of voice and data services converging, and renamed itself accordingly.

At the same time, to show that it has teeth, the CMA has launched a scathing attack on UK telecoms regulator Oftel, claiming that its attempts to regulate BT have been ineffectual and it has failed to provide users with a competitive market in which to buy their telecoms services.

"All Oftel has done is put out guidelines with no force behind them. Oftel is toothless and BT has filled that vacuum by issuing its own terms," argues John Wright, chairman of the new CMA.

Members speak out
The CMA's statements were based on the user group's eighth annual poll of members' opinions released last month. The survey of 400 communications professionals indicated that BT is still the dominant supplier of fixed communication services, with 59 per cent using the company as their main vendor and 80 per cent using it in some other capacity.

BT Cellnet also came out on top for providing mobile business services, with 34 per cent of companies using its offerings compared with 31 per cent using Vodafone, down from 39 per cent last year.

The survey also showed that 78 per cent of communications professionals believe Oftel has "failed to deliver effective competition in all parts of the UK". Almost three-quarters said rival services are only available in major cities, and the same number said they see no competition in the leased line market.

Although 85 per cent of companies are deploying ecommerce systems, and a third said their businesses are now dependent on the internet, three-quarters believed telecoms operators are not investing enough in infrastructure to support their future growth.

The vast majority of those surveyed were extremely dissatisfied with BT's asymmetric digital subscriber line (ADSL) rollout, with half saying they would not have access to it for two years. Respondents feel that the service should be included in BT's universal service obligation, with 45 per cent claiming that business is being held back as a result of not having access to ADSL.

"There is a massive failure in government policy in providing universal high-speed access over copper. There is only one provider in Scotland, where only six per cent of people will have access. That is crazy," says Wright. "The overwhelming majority of communications professionals are saying access to broadband is very important and they have expressed strong dissatisfaction with BT's rollout."

"It's not good enough that it depends on where you live," adds CMA deputy director general Mark Smith. "We are disappointed that little or nothing has been done to give people access to broadband. This is a major issue for the country."

Unbundling local loops
Although a European Commission Directive states that local loops should be unbundled across member states by 31 December this year, Oftel and BT have tried to delay this until July 2001. The Commission said no, however, so Oftel has gone for a partial unbundling.

"Oftel is claiming that it has met its target of 31 December, but that is a fudge," says Wright. "It is highly unlikely that all of the local loops around the country will be unbundled by July." He estimates that competitors will have installed equipment in only 400 of the country's 6000 exchanges by then.

The CMA is also critical of what it claims is Oftel's failure to set reasonable prices and conditions for rivals connecting to BT's network. "The contracts are one-sided. All the risks are on the shoulders of the entrants," he argues.

But Wright pointed out that it is difficult to criticise BT as it is simply protecting its shareholders' interests. "The problem is that, from a customer's point of view, they come a poor third after shareholders and Oftel," he says.

Wright revealed how the then TMA had exchanged furious letters with Oftel's former director Don Cruikshank in an attempt to prove that there was no competition for providing ISDN lines and that prices were higher in the UK than in the rest of Europe. "He [Cruikshank] refused point blank to regulate, saying he was unwilling to get into micro regulation," says Wright.

He continued that Oftel has also refused to regulate the leased line market for the same reasons. "The only conclusion that can be drawn is that regulation has not been successful. After 16 years of Oftel, we still do not have proper competition. It's alright if you are based in the City of London, where you are spoiled for choice. Once you move outside, the choice is BT or BT. If you have lots of branches and want a one-stop shop, you have to choose BT," Wright claims.

The future
So what should be done now? "In the short term, Oftel director general David Edmonds is going to have to get tougher on BT, and the government is going to have to back him. Long-term, we have to move to a new regulatory regime," says Wright.

"But Ofcom - the body mooted to converge the telecoms, communications and broadcasting industries - is at least 18 months off," he adds. "Patricia Hewitt told the Labour party conference that she expects a White Paper on convergence by December, but it was not clear whether that is this December or next. Trying to put these industries together is going to be really difficult. The last thing we want is another ineffective, toothless Oftel."

Wright concludes with the stark warning that, if Oftel doesn't shape up, any decision to clamp down on BT may eventually be taken out of its hands because the European Commission is taking an increasing interest in how the UK regulates its telecoms industry.

"I would not have said this a few years ago - but today we have to acknowledge that national regulation is driven by what happens in Brussels," he says.

The CMA claims to be the new voice of communications managers

From now on, the TMA will be known as the CMA. What prompted the name change? Its members' job titles are now as likely to be project manager or managing director as services delivery or telecoms manager.

"The TMA is no longer a club for voice techies. Our new name is meant to reflect that 35 per cent [of our members] have an IT background," says director general David Harrington. "It is also meant to reflect that our membership is broader than ever before, and includes more people with business and corporate roles.

"We have seen a seismic shift in the roles our members perform. CMA members are middle and senior managers, responsible for information and communications technology in medium and large organisations around the UK," he adds.