The settlement, which follows Ofcom’s acceptance of legally binding undertakings from BT, is based on the principle of focusing regulation only where it is needed and rolling it back elsewhere. It will deliver clarity and certainty to the whole telecommunications industry. It represents the biggest regulatory change since BT was privatised more than twenty years ago.
As part of the settlement, BT has agreed to create a new business called openreach (see accompanying news release DC05–613). This business, which will be up and running by January 2006, will ensure all service providers have transparent and equal access to the nationwide local BT network. This network covers the “first mile” of wire that connects homes and businesses to BT exchanges across the UK.
BT chairman Sir Christopher Bland welcomed the settlement:
“This is a real achievement for the whole communications industry. It will benefit consumers, businesses and the UK economy. Ofcom have shown real vision, and BT looks forward to competing in this new regulatory environment”.
BT chief executive Ben Verwaayen added: “This settlement is a defining moment for the industry and BT is totally committed to it. It offers a fresh start and means that companies will be able to focus entirely on their customers without being distracted by micro-regulation. It provides everyone with greater certainty and clarity. That, in turn, will release investment and innovation from which everyone will benefit.”