{"id":10172,"date":"2015-09-21T08:53:09","date_gmt":"2015-09-21T07:53:09","guid":{"rendered":"http:\/\/www.ispreview.co.uk\/?p=10172"},"modified":"2015-09-21T13:21:24","modified_gmt":"2015-09-21T12:21:24","slug":"iod-joins-sky-talktalk-and-vodafone-in-call-for-uk-competition-probe-of-bt","status":"publish","type":"post","link":"https:\/\/www.ispreview.co.uk\/index.php\/2015\/09\/iod-joins-sky-talktalk-and-vodafone-in-call-for-uk-competition-probe-of-bt.html","title":{"rendered":"UPD IoD Join Sky, TalkTalk and Vodafone in Call for BT Competition Probe"},"content":{"rendered":"

The Institute of Directors (IoD), INCA and Self-Employed & Freelancer Association (IPSE) have today joined Sky (Sky Broadband<\/a>), TalkTalk<\/a> and Vodafone<\/a> in a new open letter that calls for the\u00a0telecoms regulator to subject BT<\/a> to a competition probe, which could result in the operator being split up.<\/p>\n

<\/p>\n

Only last week Sky’s Chief Strategy Officer, Mai Fyfield<\/strong>, criticised BT<\/a> for an alleged “under-investment<\/em>” in its national infrastructure and attacked their “unacceptable levels of faults and service problems<\/em>” (here<\/a> and here<\/a>), while BT<\/a> naturally denied the accusations and described them as “plain untrue<\/em>“.<\/p>\n

Sky, much like TalkTalk<\/a> and Vodafone<\/a>, have over the past couple of years repeatedly called for BT to be split from control of their national broadband and phone network (Openreach<\/a>), which would be a radical move and one that requires Ofcom<\/a> to give its support and then refer BT to the Competition and Markets Authority<\/a> (CMA).<\/p>\n

The national communications regulator is of course gearing up to publish the initial findings from their Strategic Review of the country’s Digital Communications Market (here<\/a>), which is also giving “serious<\/em>” consideration to the possibility of a BT split, and so naturally the operator’s rivals are piling on the pressure.<\/p>\n

Today’s letter, which was initially hidden behind the FT’s paywall but has now been made public by the ISPs, suggests that BT delivers a “substandard experience for millions of customers<\/em>” and warns that the operators “fundamental problems<\/em>” (e.g. such as a perceived “conflict of interest in the role of BT, poor quality of customer service and difficulties in enforcing the existing regulatory regime<\/em>“) won’t be resolved through Ofcom<\/a>’s usual “tinkering<\/em>“.<\/p>\n

Meanwhile BT freely admits that it still has work to do on the customer service front, although they claim to have met the vast majority of Ofcom<\/a>’s regulatory requirements and warn that separating them from Openreach<\/a> would result in “huge uncertainty<\/em>” and “fundamentally undermine the case for future investment<\/em>“.<\/p>\n

The Open Letter:<\/strong><\/p>\n

SIR\u2013 Every home and business in Britain deserves fast and reliable broadband access. It is essential if Britain is to fulfill its potential to be the world\u2019s leading digital economy. Unfortunately, today\u2019s broadband market is letting customers, businesses and Britain down. It is time we considered radical reform.<\/em><\/p>\n

Ofcom is currently conducting the most fundamental review of the communications market in a decade, and has identified serious problems with the ownership of the national telecoms network by BT Openreach<\/a>. These include a conflict of interest in the role of BT, poor quality of customer service and difficulties in enforcing the existing regulatory regime. The result is a sub-standard experience for millions of customers and diminished opportunity for alternative providers to compete effectively.<\/em><\/p>\n

There is an urgent need for increased competition so that alternative providers are encouraged to invest and innovate to solve the challenges ahead. These include investment to deliver broadband coverage in hard to reach areas, improved service quality and reliability, fibre products suitable for Britain\u2019s SMEs, and new ultrafast broadband services.<\/em><\/p>\n

We do not believe that the fundamental problems identified by Ofcom can be addressed by tinkering with the existing regulatory framework. Ofcom has done a good job of delivering competition on the old copper network, but the powers given to it are insufficient for the new superfast world.<\/em><\/p>\n

It is therefore crucial that Ofcom moves as quickly as possible to ask the Competition and Markets Authority (CMA), with its far reaching powers, to undertake a full market investigation. Only the CMA, with the support of Ofcom, can address the structural barriers to competition that will unlock the next wave of investment in communications infrastructure that the country urgently needs. We cannot afford to wait.<\/em><\/p>\n

Yours sincerely<\/em><\/p>\n

Chris Bryce, Chief Executive, Association of Independent Professionals and the Self Employed<\/em>
\n Chris Pateman, Chief Executive, Federation of Communication Services<\/em>
\n Malcolm Corbett, Chief Executive, Independent Networks Co-operative Association<\/em>
\n Simon Walker, Director General, Institute of Directors<\/em>
\n Jeremy Darroch, Chief Executive, Sky<\/em>
\n Dido Harding, Chief Executive, TalkTalk<\/a><\/em>
\n Jeroen Hoencamp, Chief Executive, Vodafone<\/a> UK<\/em><\/p><\/blockquote>\n

Meanwhile Ofcom’s CEO, Sharon White<\/strong>, has previously said that she favours a “lighter approach<\/em>” to regulation and it’s difficult to see how that would chime with the “radical<\/em>” idea of Openreach’s separation; unless of course you perceive that a post-BT dominated market might adopt lighter regulation than today.<\/p>\n

A split would also raise the possibility of significant legal challenges, difficulties over apportioning BT’s debt pile\u00a0and pensions (would tax payers shoulder the burden or rival ISPs?), the impact on the price we all pay (improvements usually cost extra) and questions about how much future investment and commitment BT’s rivals would actually be willing to make. The grass might not be greener on the other side and things\u00a0could even get worse, depending upon Ofcom’s approach.<\/p>\n

As we said last week, consumers need to be given more thought and engagement in this debate. BT’s rivals are clearly serious about delivering an alternative, but they need to spell out precisely what they’d do and how much investment they’d stump up, then maybe it would be easier to judge whether Openreach is truly going to be better off in their hands. Otherwise business is business and we are all just numbers to be bargained over.<\/p>\n

The first preliminary proposals from Ofcom’s review should surface by around the very end of this year. A snap poll conducted by ISPreview.co.uk last week revealed that 46% of respondents expected the regulator to only make small changes to the market, while 35% anticipated full separation and only 16% though that they’d make some modest regulation and other tweaks to improve competition.<\/p>\n

UPDATE 1:14pm<\/strong><\/p>\n

The CEO of TalkTalk, Dido Harding, has also given her own personal opinion and naturally it echoes the above letter.<\/p>\n

Dido Harding said:<\/strong><\/p>\n

“For some time now I\u2019ve been arguing that the broadband market is letting customers and businesses down. There are always ways TalkTalk can be better, but many of the problems are caused by the way the market is structured. Over 500 telecoms companies exist in the UK, but most depend on a shared set of wires that connect individual homes to our networks. When BT was privatised, it was allowed to keep control of this network on behalf of the whole industry, and it is managed today by Openreach, a BT company. It\u2019s like one gas supplier owning the national grid, or one airline owning Heathrow.<\/em><\/p>\n

Unfortunately, that system isn\u2019t working because BT has used its sole control over the network to its advantage, rather than to benefit the network or customers. Openreach makes a lot of money, but it hasn\u2019t invested enough in maintaining the network, leaving customers suffering from poor quality of service and facing long waits to repair faults or install new lines. It allows BT to abuse its control to restrict choice for customers. It also makes it harder for the regulator to enforce the rules and be a powerful consumer champion. Put simply, it\u2019s a tired model not fit for a superfast future.<\/em><\/p>\n

Openreach is TalkTalk\u2019s biggest supplier; we couldn\u2019t operate as a business without it. So naturally, I\u2019ve got a vested interest in this debate. But what matters about today\u2019s letter is the breadth of the coalition calling for change. It includes some of the biggest companies in the industry who have tried \u2013 and failed \u2013 for years to improve the system, as well as smaller players battling to bring innovation and choice to the market, but let down by Openreach.<\/em><\/p>\n

Most importantly it\u2019s not just the industry calling for change, it\u2019s customers too. Today\u2019s letter is signed by organisations representing 100,000 customers, including tens of thousands of small businesses and home workers who depend on broadband for their living but who feel let down. That\u2019s more people than will fill Twickenham for the rugby world cup final!<\/em><\/p>\n

There is an alternative. Ofcom is currently conducting the most fundamental review of the market in a decade. One of the options being considered is whether customers would be better served by separating Openreach as an independent company. I firmly believe that they would.<\/em><\/p>\n

A separate Openreach would be able to focus exclusively on investing in improving the network, rather than struggling to get the attention and money it needs as a small part of a much bigger company. That means people\u2019s broadband would break less often, and when it did, it would be fixed quicker. Separation would allow other companies to compete more effectively, giving customers more choice to find better deals. It would also create a level playing field for others to invest in world-leading technology, such as the ultrafast network we\u2019re trialing in York.<\/em><\/p>\n

Before we get that far though, Ofcom first needs to refer the issue to the Competition and Markets Authority (CMA), which has the power to investigate the issue and force through the changes needed. Once referred, the CMA would then run a thorough, independent process, assessing the evidence and deciding whether there is a better way of serving Britain\u2019s broadband customers. Today\u2019s letter has a simple ask; that Ofcom refers the issue and allows the CMA to start work. There will be different views about the best way to improve the market, but it\u2019s too important not to ask the CMA to consider the issue.<\/em><\/p>\n

Customers are telling us loud and clear that they want change. Ofcom has the power to kick-start that process. Today I\u2019m asking that they seize it<\/em>.”<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

The Institute of Directors (IoD), INCA and Self-Employed & Freelancer Association (IPSE) have today joined Sky (Sky Broadband), TalkTalk and Vodafone in a new open letter that calls for the\u00a0telecoms regulator to subject BT to a competition probe, which could result in the operator being split up.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0,"footnotes":""},"categories":[1],"tags":[474,472,36,69,66,74,96],"class_list":["post-10172","post","type-post","status-publish","format-standard","hentry","category-uk_isp_news","tag-bt","tag-business","tag-ofcom-regulation","tag-bt-openreach","tag-sky-broadband","tag-talktalk","tag-vodafone"],"share_on_mastodon":{"url":"","error":""},"yoast_head":"\nUPD IoD Join Sky, TalkTalk and Vodafone in Call for BT Competition Probe - ISPreview UK<\/title>\n<meta name=\"description\" content=\"The Institute of Directors (IoD), INCA and Self-Employed & Freelancer Association (IPSE) have today joined Sky (Sky Broadband), TalkTalk and Vodafone\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ispreview.co.uk\/index.php\/2015\/09\/iod-joins-sky-talktalk-and-vodafone-in-call-for-uk-competition-probe-of-bt.html\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"UPD IoD Join Sky, TalkTalk and Vodafone in Call for BT Competition Probe - 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