BT must open up 'loop' faster, says Cable & Wireless

Published on Sunday 13 November 2005 00:03

CABLE & Wireless boss Francesco Caio has warned BT that the industry remains sceptical about its plans to open up the telecoms network to rival operators.

BT launched Openreach in September in response to criticism that it was restricting access to local telephone exchanges - the 'local loop'.

C&W's internet arm Bulldog is installing its equipment in around 800 BT exchanges to enable it to run broadband services over BT's network.

But speaking at a telecoms industry conference in Edinburgh last week, Caio said he was not yet convinced that Openreach would work and it was necessary for BT to show "equivalence of behaviour and cost".

"We will be watching very closely how Openreach works. Not only the technicalities - LLU is a cumbersome process - but also in its attitude and behaviour.

"It's very important for everyone to realise that LLU will contribute to delivering choice. There's a lot to be done and it's got to happen."

Caio told delegates at the Ofcom conference that his colleagues in Bulldog complained that the service they had received form BT was not up to scratch.

"Only in the last few weeks have we got 65% to 70% of services right first time from BT. When I speak to colleagues in Bulldog [about the performance of Openreach], they say: 'We won't tell you because you tell the press and then people in BT get angry.'"

BT has run into trouble over allowing rivals access to its local-loop network - the last mile of copper wiring between consumers' homes and its local exchanges. Rivals such as ntl, Thus and C&W have complained on numerous occasions and many pulled out of LLU altogether.

Earlier this year, Ofcom considered referring BT to the Competition Commission over the issue, which could have lead to BT Retail and BT Wholesale being split.

But that was avoided when Openreach was created this year complete with 25,000 staff.

BT chief executive Ben Verwaayen described it as the "biggest change since BT was privatised 20 years ago".

Ofcom has made it clear that this is BT's last chance to set up a level playing field, and the regulator's chief executive Stephen Carter used last week's conference to warn the telecoms giant that it would act if BT does not do this.

But if rivals and Ofcom feel this is not happening, the demerger threat could arise again for BT.

Ian El-Mokadem, managing director of Onetel said last week that he believed Openreach to be a "good solution", but said: "Ofcom does have controls and if things don't work out we would urge it to use them."

A BT spokesperson said: "The creation of Openreach is good news for BT and good news for all the other service providers. Openreach will be operationally distinct from BT, delivering transparent and equal access to the local BT network for all communications providers."