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BT forced to offer unmetered access to competitors

And other very interesting happenings at Oftel

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Oftel, the winged watchdog, has told BT it must offer its competitors an unmetered rate of access to its network. The decision follows a complaint by MCI Worldcom that BT refused to offer it a flat-fee service, offering instead the usual pay-as-you-use metered access.

The decision means that ISPs can now get to grips with competitive unmetered Internet access for consumers and business - something that everyone, bar BT, has been arguing for since the beginning of e-time and which brings us in line with the US (AOL wrote a triumphant press release just for the occasion).

The news had been greeted with nave joy by the press and cleverly used by Oftel to boost its image. The simple fact is that Oftel didn't have a single reason not to rule against BT.

The watchdog's ludicrous way of working (must have official complaint, only act if proof of anti-competitive behaviour) has worked this one time. BT unveiled its unmetered Surftime package which was blatantly anti-competitive, since no one else could afford to do the same.

MCI asked for the means to compete effectively, BT said no way, MCI made a formal complaint.

It is instructive how Oftel has dealt with the issue. There was no mistaking the conclusion it came to. But how interesting that it produced a press release entitled "Oftel publishes consultation document on pricing of unbundled local loops" on 24 May, another entitled "UK consumers benefit from lowest prices for certain key telecoms services" on 25 May, before finally releasing "Oftel requires BT to support Internet access for other operators" on 26 May.

If you didn't know better you'd think Oftel was a strong, battling crusader for consumer rights.

But this press manipulation is anything but bad. In fact it comes as a relief to see Oftel waking up and beginning to act like a telecoms watchdog with real teeth.

Even more incredible is that Oftel has made full reports easily available over the Net and (gasp!) has even started included useful figures in its announcements, as opposed to saying they are confidential. So startling is the change that we may even start calling its press office again.

Why has Oftel changed tack and why do I care?
So what if Oftel has woken up is what many of you will be asking. Very simple. If we can assume that it is now functioning as a reliable check on the industry, future announcements can be analysed using logic and commonsense, without having to peer through the Oftel filter. This is good news for the industry and hence consumers.

Of course there is also a complementary danger, stemming from the reason why Oftel has changed. Clearly, Oftel and its head David Edmonds have been under huge political pressure - we don't know what conversations went on in Whitehall but it's fair to assume that head of a watchdog is not a job for life. The plus side is activity and speed, the down side is that Oftel is embarrassingly trying to prove itself.

It can hardly control its joy when it reports the UK has the lowest-cost off-peak Internet access in Europe. It flags this prominently and conveniently forgets all the negative aspects of the independent report. Is this the action of an autonomous watchdog? Surely its job is to scare the industry into action by making it transparent, not tell us what a great job it is doing?

A closer look at the report also shows up some clever data manipulation. The UK isn't the cheapest for European telecoms, no way near. In most situations it is one of the most expensive. The Internet access figures appear to presume the best possible scenario for each package and also gone with the best deals.

It says that "non-price factors, such as quality of service, availability and choice have also been considered" - but have they? Who knows. What good is a cheap ISP if you can't get on the Net during the evening?

There is little doubt that the huge and heavy competition in the UK ISP market is bringing down the prices but the implication is that this is thanks to Oftel, rather than in spite of it. Hopefully Oftel will stop looking over its shoulder and get on with acting like a consumer champion. ®

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