Kitz Forum
Announcements => News Articles => Topic started by: Black Sheep on November 29, 2016, 07:14:16 AM
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Mike McTighe to be first ever Openreach Chairman
As part of Ofcom’s Digital Communications Review (DCR), we announced in July we had volunteered to make governance changes to further enhance the independence, autonomy and transparency of Openreach.
There are many areas of alignment between BT and Ofcom about the DCR, including the creation of an Openreach Chairman and Board with a majority of independent members. This will establish a more independent Openreach to serve the needs of industry. The Board will be accountable for setting the strategy and overseeing and managing the performance of Openreach, working with Clive Selley and his leadership team. It will also ensure Openreach continues to treat all customers equally.
Today we’re delighted to announce that Mike McTighe has been appointed Chairman of Openreach from January. Mike will oversee the new Openreach Board which will operate from early 2017 and he will be instrumental in selecting further independent members to join the Board. Mike is an experienced telecoms executive and regulator who spent eight years on the Board of Ofcom. Openreach will benefit from his detailed industry and regulatory knowledge.
We know for colleagues, particularly those in Openreach, Ofcom’s review has been unsettling. However, we’ve said all along that we believe the changes we’ve proposed are the right thing to do to improve customer service and how Openreach works with industry.
We remain in discussion with Ofcom to reach a voluntary agreement which we believe is the best way forward. Further updates on this and the structure of the Openreach Board will follow as soon as details become available. We’re hopeful that this significant move can help underpin a sustainable, proportionate and fair regulatory settlement that is in the interests of all concerned.
Gavin
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Admin - Topic title amended
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http://www.bbc.co.uk/news/business-38141510 (http://www.bbc.co.uk/news/business-38141510)
BT ordered to legally split from Openreach by Ofcom
Telecoms regulator Ofcom has ordered BT to legally separate its Openreach division, which runs the UK's broadband infrastructure.
Openreach should become a distinct company within the BT group, the regulator said.
BT had not voluntarily addressed competition concerns Ofcom laid out in July (http://www.bbc.co.uk/news/business-36891446), it said.
Ofcom said it was preparing a formal notification to the European Commission to start the process.
The regulator has resisted calls to split Openreach off entirely.
Ofcom said BT had not gone far enough (https://www.ofcom.org.uk/about-ofcom/latest/media/media-releases/2016/update-on-plans-to-reform-openreach) to address its concerns about BT's ability to favour its retail business when making investment decisions in Openreach.
It wants Openreach to become a distinct company with its own board, with non-executives and a chair not affiliated with BT.
Openreach would also have a duty to treat all of its customers equally, the regulator said.
Analysis: Dominic O'Connell, Today programme business presenter
BT's rivals, including Sky and Talk Talk, had complained bitterly about the service they received from Openreach, saying it charged too much for the use of broadband lines and was unresponsive to their demands. They wanted a full break-up of BT, with Openreach being turned into a separate company.
Ofcom has come some of the way, with Openreach now to become a legally separate entity, with its own independent board. But crucially it will still be owned by BT. Telecoms experts say the devil will be in the detail - how much control will BT be able to exert over Openreach under the new structure?
Sky and Talk Talk will be watching for any signs of too much influence - but if BT has no say at all over Openreach, it may in the end decide to break itself up anyway.
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I think all know my view on this. It is where we should have been all along, it should never have been allowed to have BT effectively owning and running the broadband infrastructure. Lets hope they force it through.
Stuart
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Dr Peter Cochrane's view:-
20 Years ago I advised BT to split into 2 or 3 divisions/companies: International; Long Lines; Local Loop. All with an eye to FTTP roll out. Now it has happened on the back of the failure to provide the BroadBand Services the country desperately needs + £Bns wasted on marginal copper upgrades that were outdated before they even went live! A real shame for the company and the country.
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Do you have a link to that Cochrane quote?
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Thanks BS for the info.
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Oh this isn't a good idea. Far better to merge Openreach and Wholesale and separate the end user facing segments.
Peter Cochrane is basically a zealot whose opinion on this stuff should be treated with extreme scepticism. His PhD has absolutely no relevance to his obsession with FTTP and complete tunnel vision to any of the consequences or benefits of it.
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Thanks BS for the info.
Pleasure as always, kitz. :)
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...... and another release from Gavin .......
Digital Communications Review
We’re already implementing many of the things that were mentioned in Ofcom’s announcement today on the Digital Communications Review.
Making Openreach more independent is something both BT and Ofcom agree on and, as you saw in my note last night, we’re making progress on this. We’ve taken the first steps by appointing Mike McTighe as Chairman of Openreach. The unions and other stakeholders including the BT Pension Scheme Trustee have also given their views as part of Ofcom’s ongoing consultation.
Ofcom’s announcement today does not recommend structural separation of Openreach from BT. They acknowledge this would drive large and disproportionate costs and it is not their preferred approach.
There are many areas of alignment between BT and Ofcom and we remain in discussion. We will keep you up-to-date as things progress. We’re committed to reaching a voluntary agreement that recognises the needs of all communications providers and is good for customers, shareholders, employees, pensioners and investment in the UK’s digital future
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Gavin
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Oh this isn't a good idea. Far better to merge Openreach and Wholesale and separate the end user facing segments.
Yup. That has always been my stance. It just further complicates things. If any splitting needs to be done then split off retail.
I really dont see how this is going to improve things, but cba to bother repeating what Ive said for the past 2 yrs. Whats done is done now.
I dont think Sky & TT will be happy until its fully dissolved. The last campaign by TT was pretty dirty IMHO. Lots of people thought they were signing for faster broadband but instead it basically sent mail to OFCOM saying they agreed that openreach needed to be split.
Peter Cochrane is basically a zealot whose opinion on this stuff should be treated with extreme scepticism.
Ahh.. yes Peter who quote says
"In 1986, I managed to get fibre to the home cheaper than copper and we started a programme where we built factories for manufacturing the system. By 1990, we had two factories, one in Ipswich and one in Birmingham, where were manufacturing components for systems to roll out to the local loop".
Reference How Thatcher killed the UK's superfast broadband before it even existed (http://www.techradar.com/news/world-of-tech/how-the-uk-lost-the-broadband-race-in-1990-1224784).
btw, where's JT at now? I'm sure he used to have lots of stuff on his site about the progress, but it all seems to have vanished since it hit problems and things didnt go as smoothly as planned.
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Clive's turn ................. I prefer facts to gossip and here-say, mad as I am. ;) :)
Ofcom’s digital communications review
Many of you will have seen Gavin’s note today and you may have seen Ofcom’s announcement. The TV and press reporting is confusing.
I want to reassure you that what has been announced by Ofcom does not recommend structural separation of Openreach from BT. They acknowledge this would drive large and disproportionate costs and is not their preferred approach.
There are many areas of alignment between BT and Ofcom about the Digital Communications Review. And we remain in discussion with Ofcom on some points with the intention of reaching a voluntary agreement which we believe is the best way forward.
Ofcom said that their current view that a form of legal separation, with Openreach as a wholly-owned subsidiary of BT, is the approach with which they are minded to proceed. This would mean Openreach becoming a distinct company within the BT Group - with its own board accountable for the business strategy and operational delivery, making Openreach more independent and transparent. Making Openreach more independent is something that both BT and Ofcom agree on. We have taken our first step in this - announcing yesterday that Mike McTighe has been appointed as the chairman of Openreach.
In our discussions with Ofcom we remain very focused on ensuring the right outcome for our people as well as our customers, industry and the UK's digital economy. We will keep you up to date as things progress.
As I said yesterday, remember please that we in Openreach will continue to be judged by the service we provide. Let’s stay focused and do what matters most - delivering a better service, broader coverage and faster speeds - giving customers the experience that they want and expect from us. We are making progress as you can see from our big bold plan achievements.
Thank you for all you are doing in serving our customers.
Clive
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btw, where's JT at now? I'm sure he used to have lots of stuff on his site about the progress, but it all seems to have vanished since it hit problems and things didnt go as smoothly as planned.
By JT you mean Jersey Telecom?
There was a bit of a kerfuffle a year back
As I recall.....
The island's government (and owners of J.Telecom) decided they were a bit short of cash so they were going to "require" J.Telecom to issue a special dividend to fill the black hole in the Gov's finances.
J.Telecom were hopping mad saying this would wreck their investment in their FTTP roll out plans and others were proclaiming loudly this is what always happens when an industry is under government control - rather than invest Gov's plunder the profits to waste on bondoogles and socialism.
I've no idea what happened next.....
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It would be great move if customers could actually get in touch with Oprenreach directly when reporting faults and setup a fault call center when OR becomes independent and transparent I have come to the conclusion that OR is neglecting it's own network due to lack of OR engineers and contractors so unless that is addressed then the customers will still be unhappy.
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Direct customer contact? Just imagine the Trustpilot reviews! :lol:
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http://www.telegraph.co.uk/news/2016/11/29/ofcom-oders-bt-split-openreach-network/
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Oh this isn't a good idea. Far better to merge Openreach and Wholesale and separate the end user facing segments.
Peter Cochrane is basically a zealot whose opinion on this stuff should be treated with extreme scepticism. His PhD has absolutely no relevance to his obsession with FTTP and complete tunnel vision to any of the consequences or benefits of it.
The thinking probably is that BTw compete with talktalk, zen and vodafone, who all provide wholesale backhaul as well and BTw would have the unfair advantage owning openreach. (zen sell to idnet)
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I think this is going to run & run..... I simply do not believe that it is in the best interest for the main BT group to retain any control at all over Openreach. Independent means a complete split in my view. BT will move heaven and earth to retain control over OR and the investment plans which to my mind completely means NO INDEPENDENCE at all.
Stuart
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From today's Times (paywalled) http://www.thetimes.co.uk/edition/business/openreach-stalemate-as-bt-pensions-fears-grow-krjr7bn3b
Worries over the size of BT’s pension deficit have become a sticking point in talks over the future of Openreach, the broadband business at the centre of a dispute over competition in the industry.
The Pensions Regulator is seeking assurances from Ofcom about its proposal to force the legal separation of BT Openreach, which operates the backbone of Britain’s broadband internet network.
In what is likely to prove an embarrassing move for Sharon White, chief executive of the telecoms watchdog, the Pensions Regulator has demanded clarity over the implications of the proposal for more than 302,000 BT pensioners who rely on the scheme, which had assets of £46 billion in June last year but far higher liabilities.
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Sadly more and more companies are failing to support their employees pension funds properly and it becomes a headache in situations like this. I think there needs to be some quite forceful intervention by government to ensure companies realise and fix the black holes in these funds. I do think some companies might use this to prevent either splits or takeovers in future (I am not suggesting that BT is doing or has done this) but some companies may just try it on so it needs fixing.
Stuart
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Oh yes , nothing more annoying than 'Pension Holidays' for company's ... Don't pay in during the good years... >:D
Take out to prop up the company dividend in bad years with no intension of putting it back, shareholders first pensioners second... :-\
If thats not bad enough, corporate take overs, only thing they ever look at is the 'Pension balance sheet', then siphon off any and all spare cash + management fees too......
Don't get me started..... >:(
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Well I guess this is movement at least. If it fails then at least BT can say they did what Ofcom wanted.
If it leaves us in a worst situation then BT themselves will be joining the complaining group too and give Ofcom a bigger headache.
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Frankly, its a rod of Ofcom's own making - they have refused for years to allow BT/Openreach to include the costs of its pension scheme when deciding what their regulated prices (i.e. line rental etc.) should be - unlike other regulators which allow pension costs.
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which is made even more silly by the fact they allowed retail price rental to be way above what openreach actually charge. Making their strict pricing on openreach pointless.
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I didn't know about Zen and IdNet.
1. Hope Zen might have a chance to sell to AA. I wonder?
2. I wonder if the likes of Gigaclear resell to small retail ISPs?
3. Wonder if B4RN might ever wholesale? Then locals would have a choice of ISPs over the excellent clean simple infrastructure.
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2. I wonder if the likes of Gigaclear resell to small retail ISPs?
3. Wonder if B4RN might ever wholesale? Then locals would have a choice of ISPs over the excellent clean simple infrastructure.
They both already do. Gigaclear via Fluidata's Service Exchange Platform, B4RN at the same prices per line as retail directly.