Sky, TalkTalk And Vodafone Outline Vision For ‘BT-Free’ Openreach

BT’s rivals, including Sky, TalkTalk and Vodafone, have issued an open letter to Ofcom CEO Sharon White detailing a ten point proposal on how they think a more independent Openreach should be run.

In its once-in-a-decade review of the UK communications market, Ofcom opted against recommending Openreach become a fully independent company but made it clear to BT that the open access division must open up more of its infrastructure to rivals and take its own decisions regarding strategy and budget.

Many of the signatories of the open letter would prefer to see Openreach made an entirely separate company, citing concerns about BT’s market strength and quality of service, but say they are pleased the process between BT and the regulator is “transparent”

Ten point proposal

They want Openreach to become a legal separate company with an independent board appointed by Ofcom and an independent adjudicator. No member of the board would be a BT employee.

Openreach would be given complete control and ownership of its assets with separate finance, legal, and product design teams. It would also have its own “distinctive” identity void of the BT brand.

The signatories also want Openreach to provide the same service to all communications providers, consult with partners about strategy and proposed investments and ensure that other infrastructure providers can compete for the wholesale contract for BT’s consumer business.

TalkTalk in particular claims that without the ability to compete for BT’s consumer business, it is impossible to build alternative competing infrastructure. Additionally, BT would be prevented from ‘overbuilding’ its network to areas where alternative infrastructure is in place – such as those operated by the likes of CityFibre and Gigaclear.

BT response

“If implemented in full, these reforms should deliver the step-change in effectiveness that customers need and remove barriers to a competitive market,” reads the letter. “The measures we have proposed are not controversial or drastic, but reflect arrangements which are commonplace for large listed companies. Our proposals are straightforward, simple, and can be achieved quickly and cost effectively.

“We are committed to helping Ofcom achieve its goal of a more independent and responsive Openreach to the benefit of consumers. Reform is crucial to delivering the improved digital connectivity Britain needs. We believe that our plan is a vital step in achieving that vision.”

BT has repeatedly insisted that Openreach is better off under its control as it can benefit from the capital and research and development capabilities of the wider group. It told TechWeekEurope the proposals outlined by the letter are unworkable and that it continues to work with Ofcom.

“We at BT are in talks with Ofcom, discussing constructive ideas to further enhance the independence of Openreach from the rest of BT Group,” a spokesperson told TechWeekEurope.

“Key suggestions made by other companies today seem incompatible with the legal responsibility that the Board of any listed company has when it comes to stewarding shareholders’ money responsibly.”

“We will publish proposals on the future of Openreach in the summer,” added Ofcom.

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