BT 'not guilty' of broadband foul play

Claims made by Freeserve last month that BT was engaging in a range of anti-competitive practices in an attempt to stifle competition in the UK's broadband market have been dismissed by Oftel, the regulator said on Wednesday.

Freeserve alleged back in April that BTopenworld had received advance notification of the broadband price cuts that BT Wholesale made in late March. Such a tip-off would not be allowed, as BT is banned from giving preferential treatment to BTopenworld and must treat it like any other ISP.

BT was also accused of cross-subsidising BTopenworld's broadband prices, including the special offers it is currently running. In addition, Freeserve was unhappy about the use of the bt.com Web address in BT's broadband adverts -- claiming this would encourage customers to choose BTopenworld as their broadband ISP.

After looking into the issue, Oftel has decided there is no truth in the allegations. "We have conducted an investigation into these claims, and have decided not to uphold the complaint," an Oftel spokeswoman told ZDNet UK News. "We didn't uphold any of the allegations," she added.

Freeserve refused to speak about the issue, saying that their policy was not to comment until Oftel has made a formal announcement of the decision -- something that probably won't happen until the regulator publishes the next issue of its Competition Bulletin at the end of June. A Freeserve spokeswoman told ZDNet UK News that Oftel had notified the ISP of its decision.

The decision comes as BTopenworld faces speculation that its future could be in doubt.

Some in the industry believe that BT Retail's forthcoming "no-frills" broadband product -- that will just provide a high-speed Internet connection without additional services such as email and Web space -- will put many of the UK's ISPs at risk. BTopenworld, which last year lost £102m before interest, taxes, depreciation and amortisation of £102m, is thought by some to be on borrowed time.

BT has denied this, though. At a press conference last month, chief executive Ben Verwaayen insisted that it made sense to have BT Retail selling a basic broadband product, and BTopenworld providing a more value-added service, as this meant that BT would be providing services that customers wanted.

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