BT and Openreach Threatened With Divorce by Ofcom

By Gary Cutlack on at

Ofcom is in the process of putting together a comprehensive digital communications review, looking at how our internet and mobile services might be delivered to us over the coming years. One of the largest changes it's looking at is the option of breaking BT away from Openreach, a move it says could encourage a fairer market and one that frustrated consumers and competitors have been asking for for years.

The worrying bit for BT (shareholders) comes from Ofcom's Strategic Review of Digital Communications, in which one of the options put forward is:

Separating Openreach from BT could deliver competition or wider benefits for end users. It would remove BT’s underlying incentive to discriminate against competitors. Separation could also offer ways to simplify existing regulation. However, the process would be challenging and it may not address some concerns relating to Openreach - such as service quality, or the timing and level of investment decisions.

A fourth and even more transformative option is to deregulate the market entirely, which would help rivals like Virgin Media spread their own infrastructure and give Openreach a bit more competition. Nothing's set in stone yet, though, as this bit of public deliberating only marks the first stage of Ofcom's Strategic Review of Digital Communications. [Ofcom]