Minister jumps to Oftel's defence

The telecoms minister Patricia Hewitt yesterday sprang to the defence of Oftel and British Telecom as a group of rival operators lodged a formal complaint over the company's failure to open its local networks to competition.

The telecoms minister Patricia Hewitt yesterday sprang to the defence of Oftel and British Telecom as a group of rival operators lodged a formal complaint over the company's failure to open its local networks to competition.

The complaint to Oftel from around a dozen operators, including Energis, Colt and Kingston Communications, accuses BT of discriminatory behaviour by denying rivals access to the "local loop" to provide high-speed internet access and other services.

An Energis spokeswoman said they were demanding that BT be prevented from rolling out its ADSL (Asymmetric Digital Subscriber Line) technology until rival operators could install their own equipment in BT's 5,500 local exchanges. "BT should not be allowed to launch services that other operators are not able to launch," she added.

The opening up of BT's local networks to rival operators - or local loop unbundling as it is known - represents the biggest competitive threat to the company since privatisation. The growing row over its slowness in unbundling the local loop has left the head of Oftel, David Edmonds, vulnerable to charges that he has been too soft on BT.

However, Ms Hewitt gave the regulator her unqualified support saying: "Oftel is making tough decisions here to deliver local loop unbundling and it has the Government's full support in making those tough decisions."

The minister said that many other countries would "love" to have a regulator as tough as Mr Edmonds. If it were not for him, then no unbundling would be taking place in the UK at all. She added that Britain would "very soon" have caught up with countries like Germany, where local telecoms networks have already been opened up on a large scale. Ms Hewitt also indicated that she understood the stance taken by BT: "Incumbent operators have their own commercial positions to protect," she said. "It is very easy for people to make complaints against incumbents. Sometimes they are justified, sometimes they are not."

BT has already installed ADSL technology in a third of its local exchanges, giving it the ability to offer customers always-on internet access, much faster down-load times and other services like video-on-demand. By the end of the year, nearly all its exchanges will be fitted out.

But Oftel does not expect BT's local exchanges to be open to rival operators on a "widespread" basis until July next year. BT has been accused of dragging its feet, initially offering to open up just 360 of its exchanges, mostly in rural areas where demand is low, and citing capacity problems for not moving faster.

Telecoms ministers from EU member states meet in Luxembourg today to approve a tough set of regulations governing local loop unbundling.

The regulations, which takes effect next January, will allow new entrants to take incumbent operators to court unless they grant all "reasonable requests" for access to their local networks on terms that are "transparent, fair and non-discriminatory". Access can only be denied where it is not technically feasible or could harm network integrity. Ms Hewitt said it would be a great pity if every dispute ended up in court because it would slow down the roll-out of services.

She anticipated that the regulation would be approved today without amendment and that a German attempt to prevent shared access to local exchanges for voice and data operators would fail.