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Oftel green lights telco access to BT's local loop

Another BT monopoly ended -- or will be by 2001

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Oftel has finally given the green light for telecoms companies to compete with BT and operate broadband services in Britain. The decision is a long-awaited and much-flagged milestone in the deregulation of the British telcoms market and effectively signals the end to BT's monopoly of the local loop -- the short distance that links people to the local telephone exchange. Once other telcos are in place, consumers should be able to chose which telco provides them with broadband services. That's the plan anyway. For this to happen Oftel has been forced to take strong-arm measures against BT by imposing mandatory conditions on the telco to co-operate with the regulator over unbundling the local loop. Oftel claims this will lead to greater competition and reduced prices, but due to a lengthy timetable it won't happen until July 2001. What's more, due to the technological shortcomings of Digital Subscriber Line (DSL) technology, a fifth of Britain won't be able to hook up to broadband service, effectively turning the country into a nation of e-have and e-have-nots. Among today's key announcements Oftel said that all telecoms operators would have the right to interconnect with BT's network and upgrade BT's lines with their own equipment. It said there would be no restrictions on the types of services that telecoms operators would be able to provide over BT's network, although this is subject to technical compatibility. Oftel also said it would take responsibility for setting the price for those telcos who want to use BT's local loop. Provisional figures aired today suggest that BT could charge operators between £100 and £115 a year for a single line. Once other operators' costs are taken into account consumers could be expected to fork out around £300 a year for ADSL access, although Dave Edmonds, Director General of Oftel, said he thought this was probably on the low side. "My decision today will enable a wide range of telecoms companies to compete directly with BT to deliver new higher bandwidth services to homes and small businesses using the local telecoms network," said Edmonds. "BT has assured Oftel that it will co-operate fully with the rest of the industry to meet this timetable. BT has agreed to work with Oftel to introduce a new licence condition, which will set out how these arrangements will work. However, since nothing involving BT or Oftel is ever straightforward, the industry will have to wait and see what really happens. ®

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