Openreach will open up telecoms market

Seperate access infrastructure business will foster competition says industry

IT directors will benefit from more diverse and competitive telecoms services following the launch of BT’s new Openreach business, say experts.

Openreach is responsible for the nationwide network that connects users to BT’s infrastructure and local exchanges.

Its creation is part of a settlement between Ofcom and BT to create a more fair and transparent separation of BT’s infrastructure for telecoms companies offering services such as broadband or telephony that require access to BT exchanges.

‘Ultimately the creation of Openreach will benefit large enterprise users,’ said Rob Bamforth, telecoms analyst at researcher Quocirca.

‘It will open out competition in local loop-based services. This will create opportunities to offer alternative, innovative or value-added services to the standard connectivity packages offered by service providers.’

Bamforth says network providers will now find it easier to offer customers additional services such as security, connectivity and mobility.

‘I would urge the formation of overall large-enterprise framework contracts that work on a multinational basis that allows for local sourcing of services,’ he said.

Mike Read, chief executive of ISP Pipex, says Openreach will allow BT’s competitors more equal access to the local loop that connects users to the national fixed- line network.

‘More services need more bandwidth,’ said Read. ‘And Openreach is the perfect vehicle to bring down bandwidth costs to providers.

‘It is very difficult to predict what those services will be in six months’ time, but it is important for BT to get network repair times down in the meantime. All this is helping us to support customers better.’

Openreach will bring together 30,000 engineers and other operational staff, currently employed by BT’s Wholesale and Retail divisions, into one organisation that will begin trading in January 2006.