Oftel scraps exchange allocation programme

UK telecoms watchdog Oftel has denied it has abandoned plans to open up BT's network despite scrapping its programme of allocating space in the telco's exchanges.

Oftel has ditched the next stage of its programme for allocating space in BT's local exchanges, known as the "bow wave" process, after holding an industry meeting last week.

The bow wave process was introduced to determine the order in which BT would open up exchanges to allow competing operators to place their own switching equipment. Two rounds of the programme have already taken place but plans for a third has now been scrapped.

Space in 700 of BT's 6000 local exchanges has been allocated following the first two rounds. Oftel, which said it was decided that a third round of the process was "not necessary", said applications for space could now go direct to BT instead.

A spokeswoman for Oftel said: "We have not abandoned plans for opening up BT's network. Unbundling is moving forward. The bow wave process was always a temporary measure put in place for the initial allocations of exchanges."

"Operators can now place orders for whichever BT exchange they wish. All measures and requirements on BT for providing unbundling are still in place," said the spokeswoman.

Companies including Thus, Telewest and Kingston Communications have already ditched unbundling plans, with many of BT's rivals arguing it was impossible to make business plans for offering services under the bow wave process.

Steve Maine, chief executive at Kingston, said last month that it was impossible to secure sufficient exchange space under the current allocation process, while Thus said it was unable to justify the economics of installing equipment into BT's exchanges.

Tim Johnson, an analyst with research firm Ovum, said Oftel's decision to end the bow wave programme could be a positive one and may lead to more equilibrium in the industry.

"It is always better to deal directly with the supplier," said Johnson. "There has been a lot of emphasis on how many people have been dropping out, and the situation is clearly chaotic."