BT and Openreach: Splitsville or not? We'll not find out till Feb – at the earliest
Fate of infraco might not be decided until 2017 says Ofcom
UK comms regulator Ofcom's much-awaited digital communications review, which will determine whether to break BT's broadband monopoly by forcing a spin-off of Openreach, will not be released until late February at the earliest.
The Strategic Review of Digital Communications will set the regulatory framework for the industry for the next 10 years.
It had been anticipated the document would be out in January, but the regulator had not set a concrete date for the proposals beyond saying they would be out by the turn of the year.
Speaking in the House of Commons this week, digital minister Ed Vaizey said that Ofcom is due to report towards the end of February, "when it will make clear what it regards as the appropriate way forward for Openreach. We will wait to see what the independent regulator concludes in that respect.”
Vaizey has previously indicated he is not in favour of a complete spin-off. “I think full separation would be an enormous undertaking, incredibly time consuming [and have] lots of potential to backfire,” Vaizey told the Financial Times in September.
Once the proposals are put forward, industry will be given the opportunity to respond. It is understood that Ofcom hopes the conclusion of the review will be wrapped up by the end of 2016.
However, Ofcom's last market review in 2005, which resulted in Openreach being repositioned to become a separate part of BT, took two-and-a-half years to conclude.
That means the fate of Openreach, along with other major industry regulations, might not be decided until 2017.
It ought to be clear by then whether the planned merger between O2 and Three will be waved through by the EU - the outcome of which will no doubt be taken into account in the final document. Ofcom has also voiced its concerns about the deal, with its chief executive Sharon White having said "four operators is a competitive number."
Back in July last year Ofcom opened its original discussion document, which proposed looking at four areas: investment and innovation in the market; giving consumers and businesses more power to choose and switch between providers; keeping regulation targeted at areas of concern; and deregulating where possible. ®