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Vodafone: So what exactly is 'ludicrous' about the Frontier report?
BT: You heard what we said about Openreach. Leave it
Vodafone has struck back at BT’s claim that the Frontier Economics report on Openreach’s apparent profiteering is “ludicrous”, with Matthew Braovac, Vodafone's head of competition and regulatory affairs, writing to his BT opposite number asking for a justification of the claims.
“Far from being ludicrous, the report is based upon an analysis of BT’s own regulatory financial statements. [These have been] applied in line with established regulatory approaches, as practiced by Ofcom,” Braovac added.
This is not the first time Voda has asked BT to explain itself, with Braovac saying he had mailed BT before over the initial findings from Frontier.
When BT dismissed those findings, it indicated that there would be what Braovac called a “substantive response setting out BT’s own analysis, comparing return on average capital employed in SMP markets with its weighted average cost of capital”.
However, that response was never received by Vodafone. BT said it took the form of a letter, which it sent not to Vodafone, but to The Sunday Times [paywall].
But even if it had sent it to the right place, it’s doubtful that a few paragraphs of text, glaringly devoid of numbers, would have fulfilled Vodafone’s lust for a spreadsheet.
El Reg asked BT for more details of its reaction to the Vodafone claims, but the company said it would not be commenting further.
There is a wonderful irony in communications companies failing to communicate. Behind this, Vodafone is seemingly maneuvering for an Ofcom Strategic Review of Digital Communications.
A TalkTalk spokesperson said the company concurred with the views of Vodafone:
“We have long argued that the current market structure is no longer fit for purpose and is a barrier to Britain realising its digital potential... It is increasingly clear that the best way to deliver the competitive modern infrastructure the country needs is to formally separate Openreach, thereby stimulating innovation, consumer choice and lower prices.”
In the last review, Ofcom stipulated that Openreach should be run as a separate organisation to the rest of BT. Vodafone, Sky and TalkTalk have lobbied for a more complete separation of the two organisations. ®