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OFCOM warns rivals over infrastructure share pricing

# 5 May 2011, 10:15 by Chris T

OFCOM has warned of the likely consequences if BT and its commercial rivals fail to come to an agreement over the price for access to BT’s pole and duct network.

Failure would likely result in Ofcom setting the price itself, a move that would almost certainly result in BT getting less money than it would like.

But it would also result in a lengthy consultation process and probably would not be finally resolved until the issue had been dragged through the Appeal Courts, the regulator warned.

Ofcom’s chief executive, Ed Richards, told the Commons Culture, Media and Sport Select Committee on Tuesday that he held out little hope of the rival companies coming to their own agreement on the issue.

BT has been locked in talks with companies including Virgin Media, TalkTalk and Fujitsu since revealing the prices it wants to charge for them to have the use of its poles and ducts in January.

“It would be much better if the parties could just agree a commercial rate … [but] I think it is unlikely they will agree,” Richards said.

Noting that the parties involved have until June to thrash things out, he added: “If after that there is no agreement, and there is a dispute brought to us, we will end up setting a price.”

Unveiling its proposed pricing structure in January – after being ordered to do so by Ofcom – BT claimed it had researched widely and had devised a fair pricing scheme for each pole, or each metre of duct, one of its rivals wished to utilise.

But a group of rival companies recently wrote to BT to complain that the proposed pricing was “anything but fair and reasonable” and claimed that it would be cheaper for them to build their own infrastructure.

Fujitsu hopes to use BT poles and ducts to roll out a super-fast fibre optic broadband network to some of Britain’s rural communities that are poorly served by current internet service products. It has signed up TalkTalk and Virgin Media to provide internet services over the network.

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