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Openreach to become separate company but stay under BT control

Ofcom has rejected calls for the Openreach broadband access programme to be taken away from BT despite widespread criticism of how the company has managed it.

A recent report from the Culture, Media and Sport Committee said that Ofcom should keep the option of taking Openreach away from BT “firmly on the table” after finding that the programme had focused on implementing broadband in more accessible properties in order to stay on target.

However, Ofcom has now proposed a model where Openreach will be established as a separate company, but BT will still own it.

It said that Openreach should have its own brand and employees and appoint its own CEO, although BT would appoint the non-executive directors. It would develop its own financial plans but with a net spending capacity set by BT.

Sharon White, chief executive of Ofcom, said that the proposals were “the biggest shake-up of telecoms in a decade” and would deliver “the best possible services for people and businesses across the UK”.

Alex Neill, director of policy and campaigns at consumer group Which?, said customers would expect the reforms to deliver “big improvements in service” in order for them to be a success.

Gavin Paterson, chief executive of BT Group, said: “We have listened to Ofcom and industry and are introducing significant changes to meet their concerns. These changes will make Openreach more independent and transparent than it is today, something both Ofcom and industry have requested.”

Ofcom’s proposals are open for consultation until 4 October. To take part, click here.

(Image c. BDUK)

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