Ofcom uses a carrot rather than a stick to make Openreach improve
Clive Selley, former CIO of British Telecom (BT) and appointed CEO of Openreach in January has avoided having to split the telecoms infrastructure provider from BT, but has to improve customer services the industry regulator Ofcom has said today in a major report.
Openreach, which BT owns, provides the core infrastructure and connection services to the UK’s telecoms network. Rival service providers, including Sky and Talk Talk claim that Openreach is uncompetitive and favours parent company BT too much. The appointment of former BT CIO Clive Selley (pictured) as Openreach CEO in January did nothing to persuade rivals differently.
Sharon White, CEO of regulator Ofcom denied that the regulator had “bottled it” in failing to force BT to spin off Openreach as a separate organisation, as the industry would prefer.
White, speaking on the Radio 4 Today programme this morning, said there would be increased governance and a new board at Openreach for the former BT CIO to report to.
“Ofcom reserves the right to spin off Openreach,” she said, adding that; “Openreach will behave more like an independent company.” The industry needs an independent company, not one that behaves like an independent company that is led by a loyal BT careerist.
White promised a strong focus on customer service improvement from Openreach and she admitted Openreach “does need major reform”. CEO Selley will be watched closely by his former CIO peers to deliver that reform and the improvement in customer service.
Today’s Ofcom report also discloses new opportunities for network providers to use existing infrastructure to increase the level of connectivity in the UK.