ISP TalkTalk Wants Gov to Worry About Lack of Fibre Broadband Competition

The CEO of budget ISP TalkTalk, Dido Harding, has warned a Westminster panel session that the UK government should “start to worry” about the lack of competition in the new market for fibre optic based superfast broadband services; where a true alternative to BT and cheaper fibre-based local loop unbundling (LLU) remains absent.

At present the dominant form of superfast broadband delivery on BT’s national UK telecoms network is Fibre-to-the-Cabinet (FTTC), which at best only offers a somewhat restrictive form of virtual unbundling known as Virtual Unbundled Local Access (VULA). Sadly this doesn’t provide the same level of price, direct control or flexibility as copper LLU services, which is technically difficult to achieve on fibre.

At present LLU still dominates the market for standard broadband (ADSL) services. But faster fibre-based solutions are slowly starting to grow and as a result TalkTalk are beginning to get a little nervous about the future.

Dido Harding said (The Register):

“I’m not in any way – to be clear – criticising the regime as of today, but I think looking forward – whether it’s in three years’, five years’ or 10 years’ time – a large proportion of the country will take their phone broadband as a superfast product, and I don’t think that we should live in a world where that is an unregulated product provided by the admittedly very talented and lovely monopolist [BT’s Openreach boss Liv Garfield sitting] on my right.

And so I think the time is now right to start looking at exactly what that regulatory framework should be to make sure that it is very clear that both parties are getting a fair price.”

Ofcom are already known to be pursuing alternatives (e.g. unbundling at the wavelength level on true fibre optic lines), which over the longer term could result in the development of a more competitive fibre market. But for the time being Harding warned that there was “simply … no alternative” to BT, especially at the infrastructure level.

Indeed it’s easy to see why TalkTalk and other ISPs might be worried, with BT Retail typically picking up the lion’s share of new superfast broadband subscribers via its FTTC products. Any advantage that an ISP can thus secure, in order to help differentiate itself from the dominant operator, would be welcomed; so far they don’t have much choice except to follow BT’s model.

On the other hand TalkTalk could perhaps put more effort into both advertising and revamping its own superfast broadband packages. For example, TalkTalk still only promotes its Superfast Fibre Broadband service as an optional upgrade (Boost) and that can cause confusion for new customers. A simpler package for new customers might help.

Separately Sky Broadband’s Fibre package does little to explain why you should pay more because they’ve opted not to clearly promote the typical service speeds. This makes it harder for ordinary consumers to tell the difference and as a result many might simply end up choosing the cheaper standard broadband solution.