Broadband News

Openreach has had its first board meeting

The Ofcom led market review into whether or not Openreach can remain within the BT Group PLC but operate more independently or full separation is the not the only topic with strong views it is very reminiscent of a vote the UK public made in June 2016 which had a close 52/48 split over the UK leaving the EU.

As part of the changes underway and some that the BT Group and Openreach hope will allow the local loop operator to remain within the group is the appointment of an independent board for Openreach, and on Tuesday 31st January 2017 this new board held its first meeting.

There are two new independent members on the board in the form of Sir Brendan Barber, former General Secretary of the Trades Union Congress and current chair of Acas, and Edward Astle, a former Board member of National Grid who joined the chairman Mike McTighe. A fourth independent non-exec member of the board will be appointed shortly.

"Openreach’s network and connectivity underpins Britain’s digital economy and we know that our customers have very high expectations of us.

I understand that customers sometimes feel let down by Openreach because we haven’t always delivered the service they expect or that we hope to provide. We have made a lot of progress since Clive Selley joined as CEO a year ago - for example on halving the number of missed appointments, making our fibre network available to millions more people and accelerating our plan to introduce a new generation of ultrafast technology. But we need to do more to re-build trust and credibility. This will be the Board’s focus and we are currently in consultation with BT Group about agreeing the plan to deliver better service, broader coverage and faster speeds for consumers and businesses across the country.

We are determined to meet our customers’ expectations and to strengthen the autonomy, governance and transparency of Openreach to facilitate the delivery of better outcomes for everyone who has a stake in our business."

Mike McTighe, Chairman of Openreach

The challenges ahead for Openreach are many and while some may prove easy to achieve, the difficult part will be winning over hearts and minds as almost no matter what, any metric you can measure is often met by criticism from those that fell outside the metric be it fault repairs, install times or simply the availability of decent broadband.

The future is fibre and pure fibre, and while this does get acknowledged by various people within the BT Group, it may be that to get people on board much more clarity is needed on what the long term plans and visions are.

Comments

It was the governments decision to privatize our telecoms so I feel it's a little unfair the BT have there hands forced in this manor and it could lead to the tax payer footing the bill but on the other hand openreach provide a service and the lack of investment isn't putting customers first ,Maybe the way forward is to draw up an agreement for ultrafast being rolled out and fttp within reasonable timescales and actively cut out aluminum with fines put in place if the work isn't done on time .

  • 2doorsbob
  • 7 months ago

if the government are so keen for Britain to have fttp then they should help the market maybe though tax relief and granting permission though local councils for work to be carried out

  • 2doorsbob
  • 7 months ago

Ofcom have a primary duty to encourage competition and it has to be asked if they are carrying out this duty properly. Openreach is a monopoly and it may well be better left alone, but how can ISPs justify their ever increasing charges and it seems that they all seem to act very closely and it is time this was investigated. There is no point in rolling out a service that is not affordable for the majority. Existing customers are put on long term contracts with no price fix with no recognition of loyalty.

  • jabrady10
  • 7 months ago

"The future is fibre and pure fibre"

That's a rather fundamentalist and simplistic point. Pure fibre may be the ideal, but that doesn't make it the future or economically justified in all circumstances. You seem to have placed no reference to economic value or cost on that statement.

It's a bit like saying high speed rail is the future without qualification as to it being economically justified.

  • TheEulerID
  • 7 months ago

@TheEulerID: Steve, it was only a matter of time before you would show up with your negative attitude again. Are you still holding on to your BT shares?

Notice these statements come from within the BT Group. Fortunately, there are still some who have a genuine interest in BTs future and welfare. You are not one of them, because your thinking is a decade behind current developments. You have no vision about what's needed to secure BTs long term future.

  • JNeuhoff
  • 7 months ago

2doors bob -- no one wants to spend amy money ISP's they just want a cheaper copper prices that today

  • fastman
  • 7 months ago

@JNheuhoff

Your statements are nothing more than easily spouted platitudes. In the real world issues such as cost, finance, economic value and markets matter. What you call negative is the application of hard-headed realism, not the sort of woolly-minded unquantified sloganising that you seem to favour.

If pure fibre was an overriding objective, then the regulatory authorities should not have set up a market regime that emphasised minimising wholesale costs and fragmenting revenue.

  • TheEulerID
  • 7 months ago

To be "positive" one thing that Ofcom could consider is giving OpenReach the power to withdraw (with notice) MPF products where a pure fibre solution is put in. Further, the wholesale costs for rental will be allowed to be set at a cost-orientated price to reflect the capital invested. What it means is in "full fibre" areas, wholesale costs for lines will be higher until such time as the extra capex is recovered.

Or, Ofcom could do what they do in the US and not force wholesaling on new fibre networks (so a position like that of VM, Gigaclear and so on).

  • TheEulerID
  • 7 months ago

@TheEulerID: While I agree that LLU copper lines should be discontinued your idea does nothing much to help BT. BT has hardly any pure fibre areas, it mainly uses VDSL, hence from an economic perspective your proposal hardly makes any difference.

There is nothing much to work with at BT because it has no long term strategy, which is damaging to itself and its shareholders. It should become a full commercial company, but that would mean to divest itself of subsidiaries which currently are under heavy Ofcom regulation and are therefore more of a burden to BT.

Meanwhile sell the BT shares!

  • JNeuhoff
  • 7 months ago

@JNeuhoff

You appear to miss the point that Ofcom's policies make it impossible to recover the costs of the investment by forcing copper to be simultaneously available at close to marginal cost levels. By sustaining LLU it completely wrecks any sustainability of a network replacement with full fibre.

  • TheEulerID
  • 7 months ago

@TheEulerID: Nobody forces the BT Group to keep loss-making subsidiaries which are under heavy Ofcom regulations! BT is digging its own grave, to the detriment of its shareholders, if it doesn't do anything about it. Its shares dropped from about £500 back in March 2016 to close to £300, it still is in a downward trend.

  • JNeuhoff
  • 7 months ago

Those share prices figures are in pence. Today's close was 305.85 pence, up 1.75p on the day.

  • uniquename
  • 7 months ago

@JNeuhoff

Openreach is not a loss making subsidiary. Indeed, whilst there is very heavy regulation by Ofcom, they are at least obliged to provide a return to the asset holders. As such, OR should give a reliable return, even if the growth prospects are limited (or non-existent - it's probably never going to be allowed to be more than a £5bn turnover company, which is what it's been since founded).
The issue is how Ofcom might encourage more investment in OR. BT management might decide to float off all the other bits of BT and leave OR with the pension liabilities...

  • TheEulerID
  • 7 months ago

all parts of the business have to make a profit and cannot be subsidised -- no BOGOF you cannot cross subsidisation against your apparatus / Network Business (its against condition of licence)

  • fastman
  • 7 months ago

jenuehoff so when you funding FTTP to your of Brightlingsea

  • fastman
  • 7 months ago

@2doorsbob,
All that anyone is interested in is cheap prices. Each time a telecomsCo raises it prices you get the endless howls of disgust and outrage on forums.
As to tax relief/subsidy - I guess you have not been following. That's called unfair state aid and is subject to approval (or not) by the EU....which fortunately from now on need not bother about anymore - and you know how I hate the EU.

  • mdar5
  • 7 months ago

@TheEulerID: "BT management might decide to float off all the other bits of BT and leave OR with the pension liabilities... "

In your dreams! BT couldn't care less about its shareholders.

  • JNeuhoff
  • 7 months ago

@JNeuhoff

You haven't a clue about UK corporate law have you. There isn't some mysterious BT that lives in isolation making decisions. The board are responsible to the shareholders and they will be in very, very close consultation all the time with the major institutional ones. It was major shareholders that forced the O2 divestment.
I'm under no illusions about the position of minor shareholders, but if you think that the directors aren't acutely aware of the major ones, then think again.

  • TheEulerID
  • 7 months ago

"jneuhoff so when you funding FTTP to your of Brightlingsea" You surely don't expect him to pay do you? If he can't get it for nothing he will continue to post his meaningless ignorant rants so I suspect we'll be seing them for a good time yet.

  • MCM999
  • 7 months ago

@mdar5 I understand why people hate price rises especially when people don't see any improvement's in there service but we can't expect bt to foot the bill for fibre roll out and then have to hand it over for wholesale .we are dispensing with the EU so I'm sure if the government wanted to intervene they could ,I'm currently looking at an air fibre product that costs more than my current provider as I'm sick of dlm cab resets and having to wait 45 minutes in a call queue with my current provider plusnet

  • 2doorsbob
  • 7 months ago

@uniquename: "Those share prices figures are in pence"

Thank you for the correction.

  • JNeuhoff
  • 7 months ago

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