VIDEO GEO UK Says it is Impossible to Take on BT’s Broadband Dominance

Chris Smedley, the boss of dedicated fibre optic provider GEO Networks, has warned in a new video interview that without better regulation from Ofcom it will remain “almost impossible to take on BT” in the United Kingdom’s broadband market; especially in terms of gaining economically viable access to the operators cable ducts and poles.

The interview stems from GEO’s “reluctant” decision to exit the governments Broadband Delivery UK (BDUK) framework during November 2011 (here), which at the time was partly blamed on the “heavy restrictions” that had been imposed upon BT’s Passive Infrastructure Access (PIA) product.

PIA was designed to save money by giving rival ISPs access to use BT’s existing cable ducts and telegraph poles to run their own fibre optic connections, which would be cheaper than building a new alternative broadband infrastructure. Unfortunately GEO found that the business case for PIA didn’t quite stack-up.

In the new interview Smedley states that the idea initially “looked pretty good” but PIAs use as a product was eventually “limited to residential broadband provision.. which by value is a minority part of the telecoms market in the UK“; this meant that GEO and other ISPs couldn’t deliver services to the more lucrative business, public or mobile sectors and serving just homes would not be enough to turn a profit.

A BT Spokeswoman told ISPreview.co.uk today:

“Ofcom defined the regulatory parameters of the PIA product and clearly stated that its primary use is for NGA based services. They concluded that there is no regulatory requirement for BT to allow other companies to use its ducts and poles to provide backhaul services, mobile/wireless connectivity or leased lines. BT already provides plenty of other wholesale access options for such services.”

Smedley told Telecom TV’s interview, “Without the regulatory backup, without the intervention in this market.. without that it’s just too much of an exposure to our very successful other business“. The disgruntled CEO then suggested that any operator, such as BT, that takes public money from BDUK to improve the national broadband network should be required to adopt fibre leasing (Smedley described this as being the equivalent of local loop unbundling in the copper network).

UPDATE 4:55pm

Added a comment from BT.