Telecoms watchdog Oftel has rejected suggestions that BT should be broken up.
A report issued in May by the Culture, Media and Sport Committee had proposed Oftel - or its successor, Ofcom - should separate the telco's network from its retail business in order to increase competition in the broadband market.
The regulator said it had sufficient powers to develop a competitive market in broadband and added that "breaking up BT is therefore not on its current agenda".
"Competition in the broadband market continues to increase, with prices cheaper in the UK than in France or Germany," Oftel said in a statement.
Last month Oftel ordered BT to open up its network to companies trying to roll out fast internet connections. Among the interested parties are Thus, Colt and Energis, which has now been taken over by former Asda boss Archie Norman.
The move follows criticism from Thus and Energis. BT owns almost all the connections between homes and small business and the exchange itself.
The alternative telcos can now offer telecoms services to customers, cutting out any involvement from the incumbent.
Oftel said the UK is on course for 750,000 broadband connections by the end of July.
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