Broadband UK: BT says Virgin should open its networks for more competition

Rapidly becoming the Itchy and Scratchy of UK telecoms, BT Openreach has renewed its call for Virgin Media to increase broadband competition by opening its networks to other ISPs.

The remarks follow Virgin’s calls for broadband expansion funds to be targeted at competitors to BT Openreach to cut the cost and increase the speed of broadband services in the UK.

Virgin claims that low prices and higher speeds in areas where it competes with BT Openreach demonstrate that competition improves the market for everyone.

Openreach is the division of BT responsible for building and maintaining the ‘last mile’ from the local telephone exchange to consumers’ homes and businesses. It’s independent of BT Retail.

A BT spokesman said: “BT would be more than happy to compete directly with Virgin for BDUK funds but we doubt that will happen.

“That is because Virgin have steadfastly refused to provide open wholesale access to their network – a key BDUK requirement – and because they have shown no interest to date in supplying rural areas with broadband.

“This is in contrast to BT, who offer broadband services on a wholesale basis to 99 per cent of UK premises.

“Fujitsu have announced their intention to bid for funds and so there will be a competitive process. We are already seeing this in several part of the UK”.

Andrew Barron, Virgin Media’s chief operating officer, told the House of Lords communications committee that Virgin doesn’t want to compete for Broadband Delivery UK funds.

“The well-intentioned provision of public subsidy should not automatically go to an incumbent like BT, and that does not necessarily mean us,” he said.

“It should ensure that where there is an incumbent, there is competition, but that does not mean that we would want to build in those areas.”

Virgin puts an extra 150,000 homes in reach of its network every year, said Barron, with an annual investment of £800million.

Broadband Delivery UK is responsible for distributing more than a billion Pounds of funding to ‘stimulate private sector investment to deliver the best super-fast broadband network in Europe by 2015.’