As expected, British Telecom will be forced to give rival service providers access to its local telephone lines within two years, the Office of Telecommunications (Oftel) announced today.
In its Access to Bandwidth: Proposals for Action report, the industry watchdog recommended that alternative infrastructure providers be allowed to upgrade BT's local loop in order to provide their own services to customers.
BT must also offer competitors fair access prices to local lines which it has upgraded, Oftel said.
BT is shortly expected to announce a major investment program to upgrade its network to provide high speed services using ADSL. (see Newswire 5 July)
Rivals must be given immediate access to this enhanced infrastructure at fair prices to enable them to offer competing services to BT, the report stated.
Oftel director general David Edmonds said it was vital that homes and businesses had access to high speed communications as soon as possible.
"We will require BT's upgraded network to be an open platform so that other service providers can compete from the outset," Edmonds said.
"In addition, Oftel considers that other operators, apart from BT, should have direct access to the copper lines so they can invest in new technology in order to provide these services," he said.
"They should not have to wait for BT to make decisions that determine the timetable for the roll-out of new services," he concluded.
In a statement, BT said the move to unbundle the local loop was unnecessary and raised "significant operational, technical and security issues".
Instead, the provider believes that offering wholesale prices to other broadband providers will provide sufficient competition and customer choice.
A spokeswoman for Oftel said further consultation would iron out such issues as they arose.
"We don't foresee any major problems," she said.
Competing operators are expected to have access to the local loop by July 2001, following technical trials.
"It's a challenging timetable but we're keen to get this process out," the Oftel spokeswoman said.
VNU Newswire will provide full analyst reaction to the Oftel decision later today.
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