BT unveils 'first mile' company openreach

bealtine

BT unveils 'first mile' company openreach

BT unveils new multi-billion pound business

BT today unveiled openreach, a new multi-billion pound business that will be responsible for the nationwide local BT network.


openreach is set to become a familiar household name as it will contain BT's field force of 25,000 engineers. These engineers make more than 3.5 million home visits every year on behalf of hundreds of companies. They are the men and women who install new lines, upgrade the local network and maintain the green cabinets at the side of the road. In short, they are the people who ensure that tens of millions of people across the UK have reliable local access to telephony and internet services.


The business, as well as having a new name, will also have a dramatic new look. Its 22,000 vans are to be re-sprayed to distinguish them from the rest of the BT fleet. They will be instantly recognisable by the bright multi-coloured waves that stretch the length of each vehicle.



openreach is being created as a result of the new regulatory settlement (see release DC05-612). It will be operational from January 2006 ensuring all service providers have transparent and equal access to the local BT network. This network covers the "first mile" of wires that connects homes and business to BT exchanges across the UK.


It will be led by chief executive Steve Robertson, whose appointment was confirmed today. Whilst remaining an important part of BT, it will have its own headquarters, distinct identity and around 30,000 staff. These staff will come primarily from BT Wholesale and BT Retail.


The business will be the second largest within BT Group by number of employees and will have assets of around £8 billion and revenues of more than £4 billion. This makes it comparable in size to some FTSE 100 companies.


openreach will have its performance monitored by the newly created Equality of Access Board (EAB). This Board will monitor the delivery of the undertakings given by BT to Ofcom and so will also monitor the performance of BT Wholesale in certain areas. Carl Symon, one of BT's non-executive directors, will chair the Board which will have a majority of independent external members.



openreach chief executive Steve Robertson said: "The local BT network is one of the UK's most important assets and my role is to ensure everyone has equal access to it. My team will be responsible for ensuring tens of millions of homes and businesses have access to the wider world and to faster and more exciting services in the future. Now we have a green light we can get down to delivering a business that everyone can be proud of. There's a huge amount to be done by January but, given the progress we've already made, I am sure we will be ready."



The structure of BT Northern Ireland will not be affected.

eth0_

That is BT UK, not BT Ireland, and therefore doesn't make any difference to us in Ireland...

dahamsta

Of course it makes a difference. It sets a precedent that ComReg should require of Eircom, but won't <.cg snipped>.

bealtine

http://networks.silicon.com/broadband/0,39024661,39152621,00.htm

BT's new broadband unit: Did they jump or were they pushed?

Don't expect any price cuts, says Verwaayen


By Jo Best

Published: Thursday 22 September 2005

Ben Verwaayen, CEO of BT Group, today revealed details about the company's creation of a new services division, openreach, and the telco's successful avoidance of a break-up at the hands of regulator Ofcom.

Verwaayen stressed that the decision to create a new division was "good news" for BT and maintained that the company had jumped, rather then been pushed by Ofcom, into making the decision.

"This is a settlement - we're not going for some regulated construct where we've been dragged kicking and screaming," he said.
Will the new-look BT actually make any difference to the industry on a large scale and to service providers in particular?

However, Lars Godell, principal analyst in Forrester's telecom and networks research team, said he would be surprised if that was the case. "[BT] have been masters at playing the regulatory game for many years. I'm not sure they got as good a deal as you would expect."

According to the BT boss, openreach is expected to be operational in four months' time with products available to ISPs in the spring of next year. The new division will encompass BT's 25,000 engineers, whose vans will be rebranded as part of the changeover.

ISPs will also see some differences in how they deal with the telco, with a new engineering booking system and postcode database.

The whole process is expected to cost the telco around £200m, in addition to marketing and retraining costs.

Steve Robertson will head the new BT unit and will be among the execs who will receive what he called "incentives" if openreach hits its targets. While the benefits are yet to be finalised, Robertson said: "They will translate into cash - and hopefully plenty of it."

Conversely, Ofcom could also impose penalties over BT if it fails to abide by certain regulations, among them proving it is providing all other ISPs with the same processes, systems and service that it provides to itself.

BT is expected to start its discussions with ISPs on these arrangements from as early as two weeks' time.

Will the new-look BT actually make any difference to the industry on a large scale and to service providers in particular? The UK's ISPs seem to be treating the announcement with cautious optimism.

Cable and Wireless chief executive Francesco Caio said in a statement: "The undertakings that Ofcom has won and the new division BT has had to create demonstrate the effect its monopoly control of access has had in undermining competition to date. Together, they present an opportunity to drive real change but there is still a difficult journey ahead."

Meanwhile others, including easynet, said the question of local loop unbundling would be the key test of the telco's dedication to opening up the market.

Scott Morrison, research director at analyst firm Gartner, said the reaction from ISPs was justified. "The caution comes from past experiences - things don't ever go as smoothly as they hope. The optimism comes from if it works out, it will genuinely represent an open playing field."

Forrester's Godell, however, said the changes will benefit ISPs rather than end users.

"To me, this shows that Ofcom are more interested in the welfare of ISPs than of end users. It's a constant dilemma for European regulators - do they benefit the end users or the competitors?" he added.

It's a suggestion borne out by Verwaayen himself. "At the end of the day, the cheaper part is at the behest of the service providers," he said.

There have also been suggestions that BT is grooming openreach for a spin-off. It wouldn't be first time the telecoms giant has launched a new company on the market - think mmO2 - and, although Verwaayen denied such a move would ever be seen during his tenure, industry watchers aren't ruling it out.

SkepticOne

So should Eircom launch something similar?

How about Eircom CustomerFirst. New jackets for all the engineers. New CustomerFirst telephone line which you can ring up to be told why it is not feasible to provide you with basic dial-up speeds etc.

jwt

Complete with new corporate logo, a clenched fist with the middle digit extended?

Or

a clenched fist with a tube of KY jelly beside it?

And new sexy answering software......

If you live within 1 nm of an exchange press 1 to continue otherwise hangup
[User presses #1]

If your line has passed our tests once press 1 to continue otherwise hangup
[User presses #1]


If your exchange has been broadband enabled press 1 to continue otherwise hangup
[User presses #1]


If your internal wiring is perfect press 1 to continue otherwise hangup
[User presses #1]


If you really really want broadband press 1 to continue otherwise hangup
[User presses #1]


Are you sure? Press 1 to continue otherwise hangup
[User presses #1]


I'm sorry there is no one available to take your query at the moment, please call later.
[Answering system cuts the connection]



John

Sponge Bob

jwt wrote:

Complete with new corporate logo, a clenched fist with the middle digit extended?

Or the brown back end of a particularly hairy , unwashed, shaggy connemara mountain sheep with the slogan

"Service With a Smile"

BT jumped because they took Ofcom seriously, Eircom are laughing at Comreg .

It wont happen here

dahamsta

Sponge Bob wrote:

BT jumped because they took Ofcom seriously, Eircom are laughing at Comreg .

It wont happen here

Absolutely. I used to think that Eircom simply thought of ComReg as a mild annoyance, but at this stage I'm convinced they're an object of ridicule and comedy in the board room. cgarvey can delete my comments all he wants but the fact is I was speaking the truth: ComReg is useless, and Gov.ie isn't going to anything about it without a boot up the hole. IrelandOffline has the right idea addressing this at the European level.

Sponge Bob

We are behind the UK by 3 - 4 years and 2 or 3 new acts in the Dáil and a ritual beheading of the first two layers in Comreg and their replacement with vertebrates .

Regrettably the next chair of Comreg is probably Mike Byrne. Eircom loOOOOOve Mike. Mike (none other) decided that the internet was overcooked at 2.4k when faced with having to define what Functional Internet Access meant back in early 2003. Mike decided that the Internat was functional at 0k .

Essentially this has not changed since despite an ultra ultra long winded consultation lasting over two years from July 2003 to September 2005 and resulting in Eircom being asked to pretty please please try not to pairgain their customers pleaaaaase or we might have to write letters to ye asking ye to pretty please please try not to .

Thats what Universal Functional Internet Access turns into when our dear Comreg get to implement an EU directive mandating it.

Mikes reward for keeping most of Ireland, by land area, in the communications stone age will be to make him Chairman of Comreg .

dahamsta

Sponge Bob wrote:

We are behind the UK by 3 - 4 years

Which is exactly where we've been since IrelandOffline was founded over four years ago. So in general, there's been zero competitive progress in Ireland. How proud I am.

bk

Ken Shabby wrote:

Which is exactly where we've been since IrelandOffline was founded over four years ago. So in general, there's been zero competitive progress in Ireland. How proud I am.

Actually I don't think 3 - 4 years behind is fair.

In terms of products and price (exluding line rental) we are actually almost exactly the same as the UK, for example:

- BT 2M with 15GB cap is €36 compared to €42.35 for the same from Eircom.
- NTL 3m/300k in Ireland is €45, in the UK it is €56 and in the UK you don't get the first three months free.

So we aren't doing too badly in price and products.

Where we are still behind on is in availablity. We are about 1 year behind the UK in availability in urban areas and more seriously we are about 2 years behind the UK in rural areas.

I say more seriously in rural areas because at this stage almost everyone in urban areas can get some form of BB, even if it is some form of crappy wireless, however many in rural areas can only get dial-up.

There has been a great improvement in Ireland over the last 2 years and IMO a lot of that has to do with the hard work of the people in IOFFL. However there is still a lot of work to do, in particular with LLU and availabilty to all.