BT Chairman: We’re Prepared To Create Independent Openreach Board

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BT Chairman Sir Mike Rake accepts more must be done about Openreach transparency and service levels but warns formal separation would be disruptive

BT would be prepared to create an Openreach board with an independent chairman and allow major communications firms that use the network to deliver their own broadband services, such as Sky, TalkTalk and Vodafone, a greater say over how the division is run.

The future of Openreach, which is currently owned by BT, has been debated ever since the start of a major review by Ofcom last year, the initial findings of which were published in February.

The regulator said BT had to make Openreach more independent or face a forced divesture – a course of action advocated by rivals who claim the current model BT has no incentive to invest and makes decisions for its own benefit.

BT Openreach future

Sir Mike Rake BTMPs have also got in on the act. Last week, a report from Department for Culture Media and Sport (DCMS) select committee that claimed Openreach suffered from a shortfall of “hundreds of millions of pounds” as BT used the open access network division to subsidise expansion into high risk areas, such as premium sports television.

Sir Mike Rake, BT Chairman, told BBC Radio 4 the company accepted improvements had to be made in the areas of customer service and transparency, but reiterated the firm’s long held stance that investment would be harmed and the rollout of ultrafast broadband would be hindered if Openreach was made independent.

“We accept that we need to do more to improve the transparency. We’re absolutely willing to form an Openreach board that will have an independent chairman and a majority of independent directors,” he said. “We want to formalise more their ability to listen to CPs so they’re engaging with them, ensuring that we can also make sure we’re delivering for them as well as for BT retail.”

Ever since Ofcom indicated formal separation was an option, BT has made noises about ultrafast broadband and has held trials of both G.Fast, which speeds up copper connections, and fibre to the premise (FTTP). In May, it delivered concrete plans of how it planned to deliver ultrafast to 12 million properties by 2020 in a £6 billion rollout.

Ofcom is due to publish its views on the future of Openreach tomorrow.

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