BT agrees to separate from Openreach

Both firms will separate this year but BT will continue to set budgets for Openreach

BT has agreed to Ofcom’s conditions for a legal separation of it broadband division Openreach this year, after two years of negotiations.

The agreement will transform Openreach into a “distinct company” according to Ofcom in a statement, with its own staff, strategy and management “to serve all of it customers equally”. The regulator had threatened to force the separation after complaints of fairness from broadband rivals.

Under the agreement 32,000 staff will be transferred from BT to work directly for Openreach, “to develop its own distinct organisational culture.”

BT’s broadband rivals such as Sky, TalkTalk and Vodafone use Openreach’s infrastructure to provide broadband to its customers. These firms have in past complained on high charges, poor services and failure to invest in the sector. Under the new agreement Openreach will be obliged to report large-scale investments to its customers. Openreach will have control over budget allocation but budgets will still be set by BT.

The BT logo to be removed from all Openreach branding to reflect the separation.

Not just BT

Ofcom chief executive Sharon White said: “The new Openreach will be built to serve all its customers equally, working truly independently and taking investment decisions on behalf of the whole industry – not just BT.

“We welcome BT’s decision to make these reforms, which means they can be implemented much more quickly. We will carefully monitor how the new Openreach performs, while continuing our work to improve the quality of service offered by all telecoms companies.”

BT chief executive Gavin Patterson added: “This has been a long and challenging review where we have been balancing a number of competing interests. We have listened to criticism of our business and as a result are willing to make fundamental changes to the way Openreach will work in the future.”

The post BT agrees to separate from Openreach appeared first on Mobile News Online.

original article Mobile News Online
http://ift.tt/2msHrqG