Ofcom: No public funding for 21CN competitors

Regulator's chief Ed Richards has dismissed the idea of public money being used to fund competition to BT's next-generation network

The chief executive of Ofcom, Ed Richards, has dismissed the idea of public money being used to fund an alternative next-generation network.

In an interview with the regulation-related blog Ofcomwatch, Richards denied that a serious competitor to BT's 21st Century Network (21CN) would need any kind of public funding.

21CN is a new telecommunications infrastructure currently being rolled out across the country by BT. The idea is that the next-generation network (NGN) should make it easier for third parties to roll out various bandwidth-intensive services to customers, but the scale of the project has also led some to fear that BT would end up without significant competition in this market. As the regulator that forced BT to open up access to its broadband infrastructure in 2005, Ofcom itself has hinted that some form of regulation might be needed to avoid BT creating a new monopoly through 21CN.

Richards, however, pointed to the initial rollout of broadband across the UK as an example of how the market can handle such developments without state intervention: "When broadband started in this country, people said to me at the time, 'We have to have broadband all over the country. It will never be provided for by the market. The market might go to 60 percent but there'll have to be government funding for the rest'."

"I remember saying in response, 'Well let's just wait and see… if there really is a problem'. What level of coverage do we have for broadband now? 99.6 percent! How much public money was necessary to do that? Zero! Would it have been a waste of taxpayers' money to spend it on supporting rollout? Yes," Richards continued.

Richards maintained that alternative NGNs would need no public funding to roll out, but stopped short of promising they would never need such subsidies.

"It may well be that in due course we feel that a public subsidy ends up being necessary some years down the line, but it's definitely not where you start," Richards told Ofcomwatch. "I would not be surprised if it turned out that we didn't need any subsidy and the bulk of next generation access was done by the market in exactly the same way that current generation broadband evolved."

The only significant alternative NGNs to 21CN currently being rolled out are those of Cable & Wireless, Easynet and Thus, although those networks are on a much smaller scale than the one planned by BT.


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