Ofcom warns on tighter Internet regulation

If the Internet industry does not better regulate itself, then public and political opinion may force tighter regulation upon it, warns Ofcom, which still has an eye on local loop unbundling

The Internet could face tougher regulation unless the industry does a better job of sorting out pressing issues, the deputy chairman of Ofcom said on Thursday night.

Speaking in Central London at the annual ISP Awards, or ISPAs, Richard Hooper warned of action on everything from improper content, spam and piracy to local-loop unbundling. If you do not regulate yourselves," said Hooper, "then the danger is that the political and public opinion machines will come down the turnpike at you. Don't underestimate the power of these bodies."

As the new super-regulator, Ofcom oversees the UK's broadcasting and telecommunications sectors, and rolls up several agencies, including the Oftel, the Radiocommunications Authority, the Independent Television Commission, the Broadcasting Standards Commission and the Radio Authority.

"Newspapers are intensely interested in [content, spam, and piracy] issues," warned Hooper. "You are working in an area where public opinion and political opinions can come together very forcefully."

Hooper also issued a thinly veiled warning to BT over the state of local-loop unbundling. "We will do our very best to ensure there is fair and effective competition in broadband retail and wholesale," he said, to a cheer from the audience, which comprised most of the UK's Internet industry: "We have not forgotten local-loop unbundling."

LLU forces incumbent telecoms operators -- BT, in the UK -- to open up their local exchanges and allow competitors to install their own kit and offer wholesale broadband services. It was intended to break the stranglehold that Europe's incumbent telcos enjoyed over their national markets in the 1990s, but in practice few exchanges have been opened up.

In a hint that Ofcom may take action on the issue this year, Hooper said "I hope that next year you'll do us right" -- in a reference to the Internet Hero Award, which was presented later that evening. Ofcom was not nominated, though Hooper appeared more concerned that Ofcom was not nominated for the Internet Villain Award.

The only companies making notable progress in local-loop unbundling in the UK are Easynet and Bulldog.

Easynet plans to have installed its broadband equipment in 229 local exchanges by the end of 2004. Bulldog -- which claims to be the only telco using local-loop unbundling to provide alternative products for consumers as well as businesses -- offers its services in London, Birmingham, Manchester, Leeds, Cambridge and parts of South-East England.