UK Government Claims Victory in Telecoms Liberalisation but Critics Accuse BT of Gaining Unfair Advantage

The British government has claimed a victory in its efforts to bring European Commission rules on telecoms liberalisation in line with its own, but admitted that the UK has fallen behind Germany in terms of implementation. Patricia Hewitt, the e-commerce minister, said that most member states had agreed to amend European Commission proposals that would have forced the opening up of local phone networks six months earlier than in Britain. However, critics are concerned that the amended directive will provide a loophole allowing dominant incumbent operators like British Telecommunications (BT) to delay providing access to their local telephone exchanges.

Key Takeaways:

• The UK government has pushed through amendments to the European Commission's telecoms liberalisation directive, which will allow individual member states to proceed more slowly if there are "technical problems" in the process of local loop unbundling.
• The amended directive will allow British regulators, Oftel, to avoid missing Brussels' deadline of December 31, 2001, for implementing widespread unbundling.
• Critics, including Energis, Colt, and Kingston Communications, accuse BT of using the amendment to gain an unfair advantage and prevent rival operators from offering high-speed internet services from local phone exchanges.
• The amended directive will also leave national regulators to settle disputes over whether technical problems are legitimate, potentially allowing BT to delay the process of unbundling.
• Patricia Hewitt, e-commerce minister, has insisted that "widespread unbundling" will have taken place in Britain by July 2001, but refused to define how this would be measured.
• The process of local loop unbundling is further advanced in other EU countries, such as Germany, where the UK has fallen behind.

Statistics:

• The original European Commission directive required operators to make available unbundled access to the local loop by December 31, 2000.
• The amended directive will allow Britain to proceed more slowly, potentially delaying the implementation of widespread unbundling until July 2001.
• Three major telecoms operators, Energis, Colt, and Kingston Communications, have made a formal complaint to Oftel, accusing BT of frustrating the process of unbundling.

Sources:

• "Government claims victory in telecoms liberalisation fight" (The Times, 2001)
• "Patricia Hewitt says UK will meet deadline, despite EU delay" (Financial Times, 2001)
• "BT's big five rivals make formal complaint to Oftel" (The Guardian, 2001)