News: Britain’s BT to build fibre ‘like fury’ after regulator’s greenlight.
LONDON (Reuters) – UK-based BT announced that it would provide fiber optic broadband to 20 million homes and businesses this decade after regulators gave it pricing flexibility to reduce the £ 12.8 billion cost of the plan. 8 billion US dollars).
The company’s shares rose to nearly 13-month highs Thursday as it allowed BT to charge broadband providers more for premium services to fund its investment. In the afternoon business, they rose 0.9%.
Chief Executive Officer Philip Jansen said it was “the green light we’ve been waiting for to go ahead and build up like anger”.
“Full fiber broadband will be the foundation of a strong BT and a shot in the arm for the UK for decades to come as we better recover from this pandemic,” he said.
The regulator Ofcom will offer companies long-term flexibility in the pricing of their fastest services as well as measures to protect competition.
“We want to give all companies the opportunity to achieve a fair return over their entire investment period and do not expect them to introduce cost-based pricing for fiber optic services for at least ten years,” it said.
Melanie Dawes, CEO of Ofcom, said companies could “invest more in the future of the country with full fiber”.
“This is a once in a lifetime opportunity to make the UK a world leader in digital economy,” she said.
The UK has left European competitors behind in building gold standard fiber optic networks for homes and businesses, and millions are relying on a mix of fiber and legacy copper links struggling to meet increasing demand.
According to Ofcom, around 70% of UK customers would have a choice of gigabit networks.
The five-year regulations allow BT to keep the price it charges operators for 40Mbps broadband and slower copper flat-rate entry-level customers and charge more for full-fiber services.
“This approach improves the investment position for BT and its competitors by giving them scope to build the new networks,” said Ofcom.
BT, which operates the national Openreach network, is well on its way to reaching 4.5 million full fiber premises this month. By the mid to late 2020s, 20 million properties are to be linked, including 3.2 million properties in rural areas.
The government plans to provide funding to reach the remaining 20% of the property.
“We will shortly publish the Gigabit project to explain where we will get the best broadband connections first and how we will tackle the most inaccessible spaces,” said Junior Secretary Matt Warman on Thursday.
Alternative Providers like Virgin Media and CityFibre are building competing networks in cities.
CityFibre chief executive Greg Mesch said the regulation would “instill confidence and unlock a decade of innovation and investment” from competitors like his company.
He said Ofcom prevented BT from lowering prices in areas where it was exposed to competition without the approval of the regulator.
The protection meant providers like TalkTalk, Sky and Vodafone could bring customers to CityFibre with no worries, he said.
Once the fiber is installed, copper regulation is lifted so that Openreach doesn’t have to maintain two networks.
($ 1 = 0.7160 pounds)
Additional coverage from Kate Holton; Adaptation by Sarah Young, Kate Holton and Emelia Sithole-Matarise
Original Source © Reuters