MPs call for BT breakup

New Net access fee plan shows BT doesn't have a clue about the online world, say MP critics

MPs called for the break-up of BT Friday, following its announcement of special Internet tariffs this week.

The announcement -- offering ISPs a set fee of £10 for around 18 hours of Internet time per user -- has outraged ISPs and users, who have denounced the scheme as nothing more than a repackaging of old tariffs.

Derek Wyatt, Labour MP and head of the all-party Internet group, is outraged by the offer, describing it as "appalling". "It is time BT was broken up. They are not an Internet company and with these tariffs have completely lost the plot. They are stopping the country from getting online," Wyatt said. He believes BT was forced to make its tariff announcement because of pressure from government to introduce cheap access. "If they think this is going to placate Patricia Hewitt [the e-Minister] they are mistaken," he said.

Richard Allen, Liberal spokesman on technology agrees that BT should be broken up. "For truly competitive prices the company offering the packages should not be the same as the company controlling the wires. Then the retailers could compete at a retail level and the infrastructure providers could concentrate on developing and improving the infrastructure," he said.

BT has admitted that the package is aimed mainly at daytime users, since it would make off-peak-level rates available during the day. Allen thinks this is missing the point. "For the development of the Internet to happen we need attractive unmetered tariffs for low volume users," he said.

Allen believes a break-up of the telco giant could be imminent, referring to recent speculation BT is to float its Internet business. "BT may well be making that decision," he said.

Both Wyatt and Allen are calling for an immediate unbundling of the local loop -- in which BT would hand over parts of its network to other operators. The current timetable for unbundling is July 2001 but Allen thinks it could be done much sooner. "I would like to see it done sooner. Gas was unbundled fairly rapidly and that was a very complex network. The telecoms network is more straightforward," he said.

While shadow technology minister Alan Duncan stops short of calling for a break-up, he is sceptical about the new tariff. "Until we see clear evidence of bills actually falling, we remain to be convinced," he said.