Oftel promises 'major' review of line charges

Oftel promises review of BT's leased line charges, admits prices in the UK are higher than European rivals

Oftel promised a "major" review of BT's charges for leased lines Monday as pressure mounts on the telco to drop its prices.

Oftel acknowledged prices in the UK are higher than in the US and launched a review which it claims will radically shake up the market. Currently ISPs have to lease lines from BT in order to deliver high bandwidth services.

Head of Oftel David Edmonds believes the review is necessary in order to ensure competition and the best deal for businesses wishing to take advantage of ADSL and other services. "This review will have a huge impact on leased lines and fast data services," he said.

An Oftel report on the current state of unbundling the local loop and ADSL is expected Tuesday. A press briefing is scheduled for 11am.

Nick White, head of technology and telecommunications at Unilever sent a stark message to BT on the issue. "In the leased line market there is still a monopoly and it should not be allowed to charge bloated leased line prices," he said. With cheaper prices in the US he warned UK businesses would be forced abroad. "Are we all going to have to follow Columbus in order to get competitive prices?" he asked.

White was among delegates gathered at the TMA (Telecommunications Managers Association) conference in Brighton. His remarks were echoed by Dr Spyros Konidaris, director of DGXII/G, the European Union body charged with regulating the European telecoms landscape. He acknowledged that prices for leased lines across Europe were too high. "There is immense room for improvement," he said, although he claimed it was not the job of the regulators to force price cuts. He believes pressure on BT and other European telcos to free up their networks by unbundling the local loop will be immense in coming months although he praised the UK for being "four or five years ahead of other European countries".

Not all delegates agreed with him. A spokesman for the Campaign for Unmetered Telecommunications (CUT) summed up the feelings of many delegates. "The feeling I get from the conference is that people are desperately calling out for unbundling as soon as possible. They are not pleased with Oftel and believe the regulatory system has got to change," he said. "BT is still running its business as a monopoly and the infrastructure exists to permit them to do so."

Vivienne Peters, director of regulatory affairs at American Express told delegates it was time for a review of the role of Oftel. "A regulatory structure that attempts to preserve monopolies should not be tolerated," she said.

Michael Portillo, the newly-installed MP for Kensington and Chelsea added his view to the calls for unmetered Internet access. In his opening remarks at the TMA conference he claimed metered access was holding back Internet take-up in the UK.

No BT spokesperson at the conference was prepared to comment on the issues. Chairman of BT, Sir Iain Vallance is due to deliver a keynote speech at the conference Tuesday.

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