Warning over BT split with Openreach

The UK’s communications watchdog has revealed how it plans to hold Openreach to account as it splits from BT.

Ofcom said it would set up a dedicated monitoring unit which will assess whether the new company is delivering on its targets, and whether the rules are being observed by BT.

It added that if it emerged the reformed Openreach was not working, or if BT failed to comply with its commitments, it would revisit the model and “consider new measures”.

In March, BT reached an agreement with Ofcom to legally separate its infrastructure arm Openreach following a drawn-out battle with the regulator.

The telecoms giant agreed Openreach would become a distinct, legally separate company with its own staff, management and strategy, while remaining a subsidiary of BT.

Ofcom has now said it expects the reformed Openreach to “engage with industry” to deliver widespread fibre networks.

“The new company should provide a good service to meet the needs of all the people and businesses who rely on its network, together with a step change in quality of service,” Ofcom said.

“We will measure how far Openreach is improving its network and helping to deliver better quality of service.” BT will not escape scrutiny either. The regulator warned the FTSE 100 firm will be closely monitored to see whether it is complying with its new commitments, and creating a “successful culture” to promote Openreach’s independence.

“Ofcom will closely monitor BT’s compliance with its new commitments, and how effectively Openreach serves the whole industry,” the regulator said in a statement.

“The unit will assess whether new governance rules are being observed, and whether Openreach is acting more independently of BT, making its own decisions, and treating all its customers equally.”

Ofcom chief executive Sharon White commended BT on the “positive progress” made since March towards implementing its new reforms.

“Once they are complete, Ofcom will keep a careful eye on whether Openreach is working for telecoms users, ensuring BT and Openreach live by the letter and spirit of their commitments,” she added.

“If we see problems emerging, we won’t hesitate to act.”

Picture: PA. Openreach is being legally separated from BT.