In March 2015, Ofcom initiated an overarching review of the UK’s digital communications markets (the "Strategic Review"). Ofcom carried out a similar strategic review ten years before in 2005 which focused on the question of separating British Telecom's ("BT") upstream access network, Openreach, from the rest of its commercial operations.
On 25 February 2016, Ofcom published its initial conclusions from the Strategic Review in a comprehensive Statement. Today, Ofcom announced further details on how it proposes to achieve the following key objectives addressed in these initial conclusions:
The Strategic Review is aimed at examining changes in the way consumers use digital communications. It comes at a time when the UK electronic communications sector is going through a period of unprecedented change. Market consolidation, together with BT's push into the pay TV market, is reshaping the industry. In addition, the growing dominance of alternative communication via over-the-top ("OTT") services, such as WhatsApp and Facebook, is challenging traditional business models.
The Strategic Review was intended to address the following broad issues:
1. Increased independence for Openreach
As part of its initial conclusions in February, Ofcom announced that Openreach would become more independent from the BT Group. Today, it set out the following proposals for consultation on how to ensure that Openreach acts more independently from the BT Group:
According to Ofcom, the proposed model would
"[…] provide Openreach with the greatest degree of independence from BT Group that is possible without incurring the costs and disruption - to industry and consumers - associated with separating the companies entirely."
2. Facilitating greater investment in fibre networks
In its initial conclusions on the Strategic Review from February, Ofcom committed to improving access to Openreach’s telegraph poles and ducts. This is aimed at encouraging the roll-out of new "fibre to the premise" networks to homes and businesses that will serve as an alternative to BT’s planned innovation in copper-based technologies. Openreach will also be required to provide an online database showing the physical location and characteristics of its ducts and poles.
Ofcom announced today that BT has already started trials of new, simpler processes for sharing its network, working with five other telecoms companies. Ofcom will set out further detail on improved duct and pole access in the autumn.
In addition, Ofcom referred to new rules that will come into force in the UK on 31 July that will give telecommunications network operators further rights to access physical infrastructure and are designed to reduce the cost of deploying broadband networks[1].
3. Better quality of service across the industry
As part of its initial conclusions from February, Ofcom also announced a range of measures designed to ensure that all telephone and broadband companies provide a quality of service that UK customers expect.
Today, Ofcom summarised the steps that it has taken to ensure greater service quality and coverage, which include the following:
Ofcom will continue with this work over coming months.