Ofcom: We're going to shake up the digi comms market

Long term review promises infra and competition reforms

UK regulator Ofcom has announced a wide-ranging review of digital communications, looking at infrastructure and competition.

The review will examine incentives for efficient investment and effective competition drive good outcomes: coverage, choice, price and quality of service for consumers, citizens and businesses.

It will cover both fixed and wireless networks and services, and take account of over the top services.

The review will be done in two phases. The first phase involves research, which appears to be working out the unknown unknowns, and the second is to take that information and make a plan for the future.

While the document doesn’t say how far away that future is, it makes lots of references to a 2005 review, so the implication is that this is a plan which will run to 2025.

The organisation has published a terms of reference document (PDF). This is not a consultation document but does call for stakeholders' input. Interestingly, the word “spectrum” only appears in the document once, as a reference to the historic 4G auction. It’s not mentioned in the context of the planning; the terms of reference is far too broad-brush for that.

Unlike consultation documents there is no proposed direction here, beyond the view that further deregulation is A Good Thing.

It does, however, muse that the outcomes might mean no major change to current approaches, but greater clarity on our strategic approach for the future; identifying areas of change, including deregulation, which can be implemented via the current framework; or a common view on how future regulatory frameworks should evolve, including at European level.

Sky responded to the announcement with a canned quote from Jeremy Darroch, group chief executive: "We welcome OFCOM's announcement of a review of the UK's telecommunications sector. The sector is vital to the UK's future but there are serious questions about whether the existing structure can deliver the infrastructure, innovation and choice that consumers and businesses need."

"Structural separation of Openreach, the UK's only nationwide broadband infrastructure, is at the heart of creating a sustainable industry; one that provides the capacity and incentive to invest whilst also harnessing the power of multiple competing retailers to drive higher take up and lower prices for customers."

"Ofcom must now take the opportunity to address Openreach’s conflict of interest as a subsidiary of BT or risk extending the problems that are affecting the industry and its customers today."

"We look forward to playing a full part in Ofcom's review."

The view that Openreach should be further separated from BT is common among BT’s rivals, with Sky, TalkTalk, EE, Virgin Media and Vodafone - who are all members of the UK Competitive Telecommunications Association (UKCTA) - lobbying Ofcom on this. Vodafone also tried to get the EU to mandate pricing on fibre last year.

The previous major review ran from 2003 to 2005. Ofcom plans to be a little speedier this time: it anticipates finishing phase one of the review this summer, and phase two by the end of this year. ®

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