Oftel Pushes BT to Open Local Loop to Rivals

The U.K. telecommunications regulator on Thursday upheld complaints that dominant operator British Telecommunications PLC (BT) is unfairly restricting access to its local loop network by rivals wanting to use its lines to offer high-speed Internet access.

Under the regulator's rules for unbundling -- the separation of infrastructure ownership and service delivery -- BT is obliged to allow competitors to install equipment in its local exchanges. However, in some cases BT has told operators that they cannot offer service because there isn't room for their hardware.

The regulator, the Office of Telecommunications (Oftel), has ruled that rivals be allowed to commission an independent survey if BT claims there is insufficient space in one of its exchanges for other operators to install the equipment necessary to run their broadband services. If the survey finds there is room for the equipment after all, BT must pay its rivals compensation.

Last October, a group including Kingston Communications PLC, Colt Telecom Group PLC and Energis PLC filed a formal complaint with Oftel asserting that BT's roll-out of broadband services discriminates against its rivals, specifically pointing out the undue preferences BT is giving to its ADSL (asymmetric digital subscriber line) customers. The operators also claimed that BT is purposely slowing down the process of unbundling the local loop, and accused BT of making up excuses in claiming there is a lack of space on those exchanges for other operators of offer broadband Internet services.

"Oftel has found in favor of the operators' complaints that the contract proposed by BT was not reasonable in a number of important areas," David Edmonds, director general of telecommunications for Oftel said in a statement.

Furthermore, Oftel determined that operators should have the right to independent verification of BT's proposed charges for co-location facilities and called on BT to "provide the same level of services to operators as it provides equivalent services for its own business."

"BT welcomes Oftel's efforts to resolve the contractual disagreements. A compromise position would be suggested. It is a very detailed document (from Oftel) and obviously we will be taking a closer, detailed look at it," a BT spokeswoman said.

When asked what those "compromises" would entail, the spokeswoman replied that it was a matter for Oftel.

Oftel determined last November 1999 that BT has a monopoly on the local network lines and directed the telecommunications operator to lease the local loop to its competitors. Furthermore, Oftel said BT must upgrade the local loop to handle new broadband digital services for faster Internet connections, to encourage competition. It then gave BT a deadline of July 2001 to unbundle the local loop. However, the European Parliament said in October this year that unbundled services should be available in all of the European Union by January 2001. Oftel said it is now "seeking further improvements to the timetable."

Oftel has allowed for a 28-day consultation period on its proposals, after which it will make a "formal Determination" of the terms and conditions for the unbundling of the local loop.

Oftel: http://www.oftel.gov.uk/. BT: http://www.bt.com/.

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