BT has outlined why the firm should retain its Openreach network division in response to Ofcom’s digital review, just two weeks after unveiling its digital ambitions for the next five years.
BT has come under pressure from the likes of Sky, TalkTalk and Vodafone to turn its Openreach division into a separate company, and its rivals have used Ofcom’s review of the communications market to lobby heavily on the issue.
However, BT has always maintained that Openreach benefits most from being part of the company, explaining that it has invested some £20bn in the division over the past 10 years.
BT has reiterated this stance in its submission to Ofcom, in which BT Group chief executive Gavin Patterson argued that continuity of the regulatory landscape is vital to ensure continued digital growth.
“We are now at a critical point in the development of the UK as a digital nation. Broadband has become central to our economic and social life today, and the industry must therefore invest to meet this growth in customer expectations and demand,” he said.
“BT is driving the transformation of Britain’s digital infrastructure, but we need the right regulatory regime that supports fair competition for all and large-scale investment.”
Patterson also used the response to try to turn the tables on Sky, arguing that Ofcom should focus its energies on the pay TV market rather than the broadband market.
“Ofcom has the opportunity to level the playing field by tackling Sky’s dominance in pay TV,” he said.
“That dominance has led to poor outcomes for UK consumers and it is about time that converged regulation was introduced to deal with a converged market. The current lop-sided approach isn’t serving customers well.”
BT’s stance is not surprising, and follows its commitment to ensure 5Mbps-10Mbps services for all by 2020 and 1Gbps services for many if regulatory support remains, clearly putting pressure on Ofcom to maintain the status quo.
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