Oftel speeds up unbundling

British Telecommunications PLC (BT) will begin construction of co-location facilities before April 15 to allow its competitors to install their broadband Internet access equipment in the most sought after of its local exchanges, according to a statement from the U.K. national telecommunications regulator released late Thursday evening. Previously, such facilities were not expected to be available until July.

The statement was released after an emergency meeting called by Oftel (Office of Telecommunications) Thursday to determine why, despite regulatory efforts to separate service delivery and infrastructure ownership in local telecommunications services, competitors are staying away.

Last week, the first 25 of BT’s local exchanges were opened to co-location bids, but BT’s rival telecommunications companies only placed orders at 14 of those sites, Oftel said.

In its efforts to spark some life into the stalled effort to bring DSL (digital subscriber line) and other broadband services to the U.K. market, Oftel is also launching an investigation into the costs of co-location space, the regulator said.

“BT is happy to agree with the proposals by Oftel,” said company spokesman David Orr on Friday. “They are all proposals we ourselves made before Christmas.”

Which calls into question the need for Oftel’s “emergency” meeting in the first place.

“No one, be it Oftel, BT or its competitors, has shown remarkable foresight,” said Tim Johnson, principle analyst for market research company Ovum Ltd.

“The situation has changed quite radically. A few months ago, people were screaming to get into the exchanges and now it seems those companies aren’t putting their money where their mouths are,” Johnson said.

Oftel determined in November 1999 that BT has a monopoly on the local network lines and directed the telecommunications operator to lease the local loop to its competitors. It said BT must upgrade the local loop to handle new broadband digital services for faster Internet connections, to encourage competition.

It then gave BT a deadline of July 2001 to unbundle the local loop. However, the European Parliament said in October last year that unbundled services should be available in all of the European Union by this month.

The opening of the “last mile,” or section of the telephone line leading directly to the end user’s home or business, has been plagued by controversy with Oftel weathering heavy criticism recently that it has not been doing enough to regulate BT.

For example, as Johnson points out, the exchanges that BT has been offering have been scattered in terms of geography, which, among other things, presents difficult marketing challenges to BT’s smaller, telecommunications competitors.

“But couldn’t Oftel have anticipated and worked out those sorts of problems months ago,” Johnson said.

“The whole thing is very difficult for all concerned because it’s completely new. But one gets the feeling that the panic in the telecoms sector is settling down a bit, though I may be being a bit optimistic,” Johnson said.

One U.K. telecommunications company, Redstone Telecom PLC, had already decided not to simply rely on Oftel and BT.

So as to eliminate the need to wait for work to begin on co-location facilities, Redstone has been building its own street cabinets outside of the local exchanges. “It’s a project we’ve been working on since November with both BT and Oftel. We’re on a parallel process with Oftel,” said Redstone spokesman Bob Cushing on Friday.

As a result the company announced on Friday that because of its own discussions with BT, it was pushing forward from July to April its launch date for DSL services. The first service should be in available on a trail basis in Portsmouth from April followed by Southampton, Newbury, Nottingham and Cambridge — all areas serving large business communities, Cushing said.

“We had a pre-meeting with Oftel yesterday and determined that we didn’t need to attend (the emergency meeting),” Cushing said.

So while Oftel’s announcement that the deadline for construction of co-location facilities has been sped up was “contemporaneous, it was not directly linked (to our announcement),” Cushing said.

Oftel, in London, can be contacted at http://www.oftel.gov.uk/. BT, in London, can be reached at http://www.bt.com/. Redstone Telecom, in Borehamwood, England, can be contacted at http://www.redstone.co.uk/.