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Ofcom mulls delaying launch of BT unit Openreach's Equinox 2 scheme

17th Mar 2023 09:00

(Alliance News) - BT Group PLC unit Openreach's Equinox 2 scheme faces a setback in its planned launch next month, as UK regulator Ofcom on Friday said it needs more time to consider the new pricing arrangements for the fibre-to-the-premises services.

Network cabling and wiring service provider Openreach plans to introduce a pricing plan for internet providers from April 1.

At the beginning of February, Ofcom - the UK's regulatory competition authority for broadcast & telecommunications - had said its provisional view is that it should not intervene with Openreach's plan. Ofcom invited responses to its consultation by March 4 and planned to publish its final decision before the end of March.

However, the regulator on Friday contended it will need an additional two months for further analysis before issuing its final decision. The delay is due to a "number of detailed responses" to its consultation, "some of which raise issues which require further assessment", Ofcom said.

As a result, it said the planned launch of Equinox 2 on April 1 "would not be appropriate" until it has issued its final decision.

"We are considering issuing a direction to Openreach, using our powers under the Communications Act 2003, to achieve this, unless Openreach voluntarily defers the launch of the offer," Ofcom said.

Shares in BT were down 2.2% to 143.45 pence each in London on Friday morning.

In December, Openreach published plans to offer lower wholesale prices to other internet providers for access to its fibre network, but the move saw network rivals raise competition concerns. It announced plans to offer discounted rates on its fibre broadband products as part of its Equinox 2 scheme.

Ofcom on Friday also published two exchanges between itself and BT Chief Executive Philip Jansen from February.

Writing to Ofcom Chief Executive Melanie Dawes, Jansen sought to defend his comments in an article reported by the Financial Times in early February.

Jansen said several comments reported in the article entitled, "BT chief warns Openreach fibre push will 'end in tears' for rivals" were taken out of context. He told Dawes his comments also had been "explicitly" welcoming of competition on fibre building.

Responding to Jansen, Dawes noted the BT boss considered he had been taken out of context, but the comments nevertheless caused Ofcom "significant concern".

"The rules we implemented in [the wholesale fixed telecoms market review] ensure a level playing field for all fibre investors, constraining BT's market power to ensure that future success will be determined by competition on the merits," Dawes wrote.

"Were it to become apparent that BT is able nonetheless to distort competition in the market, we would not hesitate to take regulatory action to address this," she added.

By Elizabeth Winter, Alliance News senior markets reporter

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