Speaking at BT’s Delivering Britain’s Digital Future event in London, Patterson said BT’s network build and investment had played a key role in building the foundations of the digital economy, and that his four pledges would help support and maintain the lead that the UK has built up.
Ofcom support
Patterson called on both the government and, more importantly, the telecoms regulator Ofcom, to support its ambitions. “This success story has been driven by massive investment and a competitive landscape that has stimulated competition and take-up,” he said.
“These pledges depend on Ofcom and the government to ensure the right regulatory and policy framework exists, but have the potential to underpin the digital economy for years to come,” he added.
Fighting talk
Following the publication of an open letter from rival broadband providers, including Sky and TalkTalk, that renewed calls for the structural separation of BT from Openreach, Paolo Pescatore, director of multiplay and video and CCS Insight, said BT’s pledge card showed Patterson was spooked and wanted to come out fighting ahead of Ofcom’s market review and the Competition and Markets Authority’s probe of its EE takeover.
“BT is putting up a strong defence. Its latest pledges will address some of the shortcomings raised by its rivals, notably investment and service quality. However, this is unlikely to satisfy its rivals, and they will still call for full separation, lower prices and greater access to BT’s network,” said Pescatore.
“While there are merits of BT’s acquisition of EE and retention of Openreach, regulators will be duty bound to listen to the comments of their competitors who will feel less positive about the transaction and the increasing monopolisation of the telecoms sector.”
Citing a KPMG report that suggested BT’s commitments could deliver between £20bn and £30bn of value to the UK economy by 2025 if BT achieved its ambitions, David Thomas, global lead at KPMG’s economics and regulation practice, called on Ofcom to reconsider the idea of structurally separating Openreach from BT.
“It is not clear to us that you would get that benefit if you went down the structural separation route,” he said.
Speaking at BT’s event, Openreach CEO Joe Garner stuck to his guns: “Openreach, supported by BT, can deliver the telecoms infrastructure that Britain needs for the 21st century. We have the track record, ambition and commitment to deliver,” he said.
