Prospect publishes response to Ofcom

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Prospect publishes response to Ofcom

Prospect has published a response to Ofcom's Strategic Review of Digital Communications, which we would urge members to read.

The response focuses heavily on the issue of the 'structural separation' of Openreach, the networks business arm of BT – ie whether Openreach should be established as a stand-alone business entirely independent of BT.

Openreach was established in 2005 in pursuit of Ofcom's previous strategic review, and supplies services to all its customers – including BT's own retail arms, Sky and TalkTalk et al – on an equivalent terms basis.

Prospect believes that structural separation is the wrong remedy, because it would:

  • chill investment in superfast broadband
  • represent a high-risk diversion and would create uncertainty
  • undermine essential improvements in quality of service
  • jeopardise the pan-BT research effort, from which all customers benefit
  • raise Openreach's costs.

Nevertheless, we have also used our response to outline in detail our vision for the future, in which investment and quality of service form a virtuous circle; and also to comment on convergence trends, particularly as regards fixed-mobile communications, which are driving the merger proposals that we are now seeing in the industry.

Ben Marshall, Prospect national secretary, commented: "Structural separation is an enormous and untimely distraction from the essential challenges at hand, which are to extend and improve the coverage of superfast broadband and quality of service. That's where the consumer interest lies. We think Ofcom should make an early move to rule this out of its consideration.“

Nevertheless, the union does see a case for some change in the regulatory approach, in particular as regards quality of service, where the industry as a whole does not have a strong record. Marshall pointed to the new Consumer Charter which Openreach has published – and which the union strongly supports - as something which could make a real difference to quality of service. "We are excited by the possibilities that the Charter represents to give effect to our vision for a permanent increase in quality. The industry needs to get together to agree standards which Ofcom can support and which will serve the interests of all consumers," said Marshall.