BT fined £42m in line installation delay row
BT Group has been fined a record £42million and faces a £300million compensation bill over delays installing high-speed cables.
Telecoms regulator Ofcom found BT guilty of a “serious breach” of its rules after it reduced compensation payments to other telecoms providers for late installations.
Ofcom launched an investigation into BT’s Openreach infrastructure network in November 2015 after mobile phone giant Vodafone alleged BT had failed to compensate it for services delays.
Under Ofcom’s rules, BT is obliged to install ethernet services – high-speed cables used by its wholesale customers such as Vodafone and Talktalk – in accordance with its contracts and to pay compensation for late delivery.
Ofcom’s investigations director Gaucho Rasmussen said: “These highspeed lines are a vital part of this country’s digital backbone. Millions of people rely on BT’s network for the phone and broadband services they use every day.
“We found BT broke our rules by failing to pay other telecoms companies proper compensation when these services were not provided on time.”
BT was also fined an extra £300,000 for not providing Ofcom with all the information it asked for.
Rivals have long called for Openreach to be split from BT. A deal was recently agreed for it to be legally separated.
BT chief executive Gavin Patterson said: “The investigation revealed we fell short of the high standards we expect in serving our communications provider customers.
“We take this issue very seriously and we have put in place measures, controls and people to prevent it happening again. My management team and I are determined that BT applies the highest standards when serving our customers.”
Hargreaves Lansdown equity analyst George Salmon said: “BT is definitely on the naughty step at the moment.
“This latest misdemeanour follows hot on the heels of an accounting scandal in Italy, and the enforced separation of the Openreach business. As a result the demands on BT’s cash flow are adding up, in the short-term at least.”