Feeds

BT could jack up line charges to fill pensions hole

Ofcom consults - unbundlers set to scream

Securing Web Applications Made Simple and Scalable

Ofcom is pondering allowing BT to jack up its line charges to allow it to lighten the £9bn pension deficit hanging round the neck of the former state-owned telco.

The possible move by the regulator could see OpenReach, BT's wholesale arm, up its charges by as much as 4 per cent.

This would in turn land on those companies which lease lines form BT, such as Carphone Warehouse and Sky, forcing them to ramp up their own prices, or look for cost cuttings.

BT has long grappled with a pension fund that has liabilities of around £40bn, and which is currently about £9bn short of what it needs to keep former British Telecom/GPO workers off the breadline.

Ofcom said, "Because of the financial significance of these payments in the case of BT, Ofcom considers it right to consult on whether or how such payments should be factored in when setting BT's regulated prices."

It said it was launching the consultation, "to promote a broad debate on whether it is appropriate for Ofcom to maintain or change the approach it currently takes to the treatment of BT's pension costs."

It added, "So far Ofcom has not taken a view on whether it is appropriate or not to change its current principles in relation to pension costs. If Ofcom changes its approach, any adjustments in wholesale charges would not necessarily be felt proportionately by consumers."

This suggests the regulator is leaving open the possibility that those third party providers might be expected to take up some of the slack themselves.

Afterall, they do benefit from a network that was built and maintained over the course of many years by an army of BT engineers who are either now happily ensconced in retirement, or pondering wondering they'll get to retirement before their jobs are outsourced. ®

Build a business case: developing custom apps

More from The Register

next story
Airbus promises Wi-Fi – yay – and 3D movies (meh) in new A330
If the person in front reclines their seat, this could get interesting
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
UK Parliament rubber-stamps EMERGENCY data grab 'n' keep bill
Just 49 MPs oppose Drip's rushed timetable
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
Want to beat Verizon's slow Netflix? Get a VPN
Exec finds stream speed climbs when smuggled out
Samsung threatens to cut ties with supplier over child labour allegations
Vows to uphold 'zero tolerance' policy on underage workers
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
US freemium mobile network eyes up Europe
FreedomPop touts 'free' calls, texts and data
prev story

Whitepapers

Top three mobile application threats
Prevent sensitive data leakage over insecure channels or stolen mobile devices.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Mobile application security vulnerability report
The alarming realities regarding the sheer number of applications vulnerable to attack, and the most common and easily addressable vulnerability errors.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.