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    • 1 Post By LeeH1978

    BT could be forced to divest Openreach after buying EE

    This is a discussion on BT could be forced to divest Openreach after buying EE within the General chat forums, part of the Community channel category; BT could be forced to divest Openreach after buying EE - Telegraph Forced spin-off of BT 's broadband is 'more ...

    1. #1
      Scubbie's Avatar
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      BT could be forced to divest Openreach after buying EE

      BT could be forced to divest Openreach after buying EE - Telegraph
      Forced spin-off of BT's broadband is 'more likely' after its 12.5bn purchase of phone company EE was approved, ahead of major industry review

      BT could be forced to sell Openreach, the network of copper wires and fibre cables it operates at arms-length, as an unintended consequence of its recent merger with EE.

      BT Group's ownership of Openreach, which is used by millions of home broadband and business customers, was scrutinised as part of the firm's 12.5bn bid to buy mobile phone company EE.

      But last week the deal was unconditionally approved by the Competition Markets Authority despite speculation that the firm might be forced to sell off its broadband infrastructure division, which is undergoing a change of leadership.

      Clive Selley, BT's head of technology, will replace current Openreach boss Joe Garner when he quits for Nationwide in the spring.

      However, a forced break with Openreach is now "definitely on the table" in light of the merger, ahead of a widely-anticipated review into the telecommunications market.

      "The CMA was unconvinced by arguments to sell off Openreach," said John Delaney of IDC, a mobile networks analyst.

      "But now the regulator will be keeping a close watch on BT's operations post-merger, to continue ensuring fair play in this area."

      Ofcom, the telecoms regulator, said it is "seriously considering" forcing BT to sell off the telecoms network and will reveal its decision in a once-in-a-decade report, due next month.

      Alongside its broadband service, Openreach also provides a service to mobile companies EE included which use its underground network of cables to carry voice calls and data.

      "Openreach provides a significant amount of 'mobile backhaul', which rivals say could now give a newly merged BT-EE an unfair advantage," Mr Delaney said.

      But the CMA rejected claims BT could discriminate against other mobile companies in its final decision, deciding that "while the merged entity might have the ability to pursue this strategy, it would be unlikely to have to incentive to do so".

      Rival telecoms firms have complained that Openreach provides poor service and does not invest enough in the network.

      But forcing a break with BT could be an "extreme reaction" that would drive up costs for consumers and delay improvements to infrastructure, said Matthew Howett, a telecoms analyst at Ovum.

      "A separate Openreach would cause disruption for a good few years full structural separation could cause chaos for customer service," he said.

      BT has said Britain could be condemned to "the digital dark ages" by a lack of investment in broadband infrastructure, should it be forced to sell off Openreach.


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      Re: BT could be forced to divest Openreach after buying EE

      Openreach needs to be a seperate company to BT. How BT have got away with it for so long, I will never know.

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      Re: BT could be forced to divest Openreach after buying EE

      Its fairly obvious why they don't want to sell it, BTO is the most financially viable part of their operations. It is used to underpin much of their other operations.

      TomD


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      Re: BT could be forced to divest Openreach after buying EE

      I strongly suspect that you are right there.

      I believe that BT Sport is being funded through profits from the money paid by the EU through BDUK for BTO to install Fibre across the country.

      ...but this is my suspicion. I would need to get a suitable forensic accountant involved and gain access to the unedited accounts from BT PLC to confirm this.

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      Re: BT could be forced to divest Openreach after buying EE

      Quote Originally Posted by Scubbie View Post
      I would need to get a suitable forensic accountant involved and gain access to the unedited accounts from BT PLC to confirm this.
      Shall we have whip-round?
      Scubbie likes this.

     

     

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