Eye2Eye: Oftel's Edmonds on unmetered

In the middle of November Oftel announced it would enhance even further the Friaco agreement which most operators agree is the only way for UK operators to get a fair deal on unmetered.

Insisting that BT takes unmetered calls even farther into its network it will allow operators to roll out alternatives to the telco's unmetered service SurfTime. Although BT was required by Oftel to make a wholesale version of SurfTime available from the summer, numerous complaints slated the offer as unfair and unworkable.

Here David Edmonds talks about the negotiations which made the Friaco deal possible and how the UK finally got unmetered Internet access.

Edmonds refuses to accept that the original SurfTime wholesale agreement was a mess and allowed BT to gain advantage in the market, but he fails to name a single operator which rolled the wholesale service out from June -- when BT launched its unmetered service.

"My argument is that we are a regulatory agency that works very methodically, very carefully... it doesn't always work overnight," he says.

Read all about it:

Oftel had two big announcements last week on local loop unbundling and unmetered access. Could you take a few minutes to talk about the background leading up to what have been viewed as quite harsh judgements on BT?

I'd quarrel that they were harsh judgements. Oftel has been totally coherent throughout the whole process -- both the delivery of unmetered access and in terms of the need to unbundle the local loop in the UK. Some of the press comments suggested that these were reactions to recent criticisms. That is absolutely not the case.

The announcement on Friaco II which extends unmetered connectivity into the network is actually a major exercise which was launched back in June/July. The report we commissioned from technical experts illustrated why it was necessary to take four or five months to look at what the network could actually cope with.

It doesn't help competition surely to have BT able to roll out half a product when one half of it isn't worked out. Surely you made a mistake there?

I don't think we did. From the moment that the BT product was available so too was Friaco.

I think a lot of operators would argue with you there.

Some operators started to make use of it quite soon and we have now developed a better product.

Who [made use of the original]?

When did AOL launch?

A month ago when they finally got what they wanted.

You have a choice with these things, don't you? You try and create a framework and that is what Oftel is all about, creating a framework for competition, but you also want to encourage BT to innovate in the market.

My job is to make sure BT does not innovate unfairly, doesn't put one over on the competition by dominating the marketplace through producing a product that other people cannot compete with. My argument is that on unmetered access we have produced conditions where there is now greater competition.

Why did it not happen at the same time as BT rolled out SurfTime?

Friaco I was a product. It was there and it was utilised. Friaco II takes connectivity deeper into the network and was put in place after we had listened to the complaints of operators and after we had analysed the strengths of the network. No one would thank the regulator if we took a bunch of decisions that led to failures in different parts of the network.

Would you accept that SurfTime in its original state was a mess?

No, I wouldn't accept that it was a mess. In its original state it actually opened the door to what we have now got. Look back in the UK at what we had and look at what we have now got in terms of unmetered access. Lowest off-peak Internet access prices in Europe and pretty close now with peak time.

But have consumers been treated to a fair deal with so many of the unmetered ISPs that were set up consequently collapsing or changing terms and conditions?

The regulator can't do the business plan for individual companies. My job is about creating a framework.

And the framework wasn't in position in June.

We've been working through this, getting towards a framework. Look at the progress we've made. Name anywhere else in Europe that has developed as quickly as we've done.

I would hope that the UK market was independent and didn't always have to been seen as better or worse than somewhere else. That it could just be good for itself.

When you are knocking me for producing something that didn't work as well as you, and perhaps some of competitors, had hoped at the outset -- and perhaps as well as we would have hoped -- you have got to take it in the context of an overall marketplace and I think you would be criticising me if I didn't benchmark myself or benchmark Oftel against progress elsewhere. It is a very complex technological area.

The technical report sets out the complexity of the BT network. Internet traffic is doubling every ten and a half months. The fact is that you have to analyse risks before you open it up. My argument is that we are a regulatory agency that works very methodically, very carefully.

Our sole goal is to produce products for the consumer that work. It does that mainly through enhancing competition but it doesn't always work overnight. You have got to take a one, two, three year view. One and a half million consumers have now got unmetered Internet access. That is a heck of an achievement.

Go to Part II

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