GREED OF THE COMPANY DRIVING US ALL MAD...

THERE are few topics more likely to make the blood boil in normally stoical British citizens than mention of telecoms behemoth BT and the quality of its broadband and customer service. Everyone seems to have a tale of woe to relate about frequent breaks in transmission, missed engineer appointments and a generally unreliable service.

Yet anyone listening to the media will have come across a fast-talking senior BT executive – for example the firm’s highprofile chairman Sir Mike Rake, or its rakish chief executive Gavin Patterson – telling a very different story.

While this smooth-talking pair waffle on about ultra-fast broadband and laying fibre-optic cable from Inverness to St Ives, the bitter truth is that Britain’s digital superhighway is barely adequate and way behind the standards enjoyed elsewhere, from Estonia to South Korea.

In a digital age, when businesses and consumers are increasingly dependent on fast broadband, the unreliability of the service which BT provides, through its notoriously inefficient Openreach arm, is a scandal.

Openreach is the wholesale network provider which owns and runs the big telecoms exchanges up and down the country – the tunnels and conduits which connect our largest conurbations and the copper wires which run into the green BT cabinets located on roads, which ultimately wire into our homes and businesses.

Whether you are a BT customer or are using a competitor such as TalkTalk, Sky or Vodafone, it will be a BT Openreach van which comes to your door to fix a line.

But the shameful truth is that, despite its huge responsibility to the British people, the monopoly that is BT has hopelessly failed to invest properly in this vast, complex network. Yesterday, the telecoms regulator Ofcom, run by former Treasury mandarin Sharon White, announced that it would not propose the forced separation of Openreach from BT, and thus fully expose the firm to raw market competition.

Instead, Ofcom has concocted a messy compromise under which Openreach will have an independent chairman and a majority of independent directors on its board, and produce its own budgets.

But its accounts and operations will still be consolidated within BT. The resultant Openreach will be required to give rivals confidential access to BT’s investment plans, including future expansion of faster broadband. This may sound sensible, but with BT still the Fat Controller – overseeing access to exchanges and street cabinets – it is hard to see how rivals will be able to make a significant impact on the former nationalised group’s dominance.

Its is both remarkable – and depressing – to think that three decades after privatisation, and with all the benefits of the technological revolution which has led to satellite broadcasting, the cabling of most of our major cities and the rise of mobile networks and wi-fi, that BT still has such an adamantine and incompetent grip on the way that we communicate.

Earlier this year, its near-stranglehold increased when the supine Competition and Markets Authority, which is meant to challenge the dominance of major players, allowed BT to acquire the mobile operator EE for £12.5billion – gifting it 35 per cent of the market. In contrast, the EU blocked a plan to merge networks O2 and Three over concerns this would ramp up prices.

Meanwhile, the truth is that in recent times, BT has become a licence to print money. Even though we live in an age when mobile phones are so prevalent, millions of homes are still heavily reliant on traditional landlines to deliver telephone services for which people pay a quarterly rental charge. But they are badly let down by BT, whose rental charges are nothing less than a poll tax on communications.

WHAT’S more, BT is making vast profits out of a service that was originally built by the State with taxpayers’ money. Instead of investing heavily in Openreach, BT – which generates up to £3billion a year of surplus cash – has gambled millions on acquiring sports rights and Hollywood films to put on its TV services, using them as a battering ram to beat away rivals. The focus on building a media empire, rather than investing in the best ultra-fast broadband technologies and customer service, is why, I believe, BT cannot be trusted any longer to run Openreach.

One of the excuses made by BT bosses to see off Ofcom was tantamount to blackmail. They claimed that having to sell off Openreach would pose enormous problems for funding the pensions of the 30,000 current employees and existing retirees.

But experience shows this is not true. The privatisation of Royal Mail two years ago and the current take-over negotiations between the Government and Tata Steel show that if there is a will to overcome such difficulties, there is a way.

The failure to free Openreach from the slug-like grasp of BT is, tragically, a barrier to Britain’s drive to become the online commercial champion of Europe. As a matter of urgency, the Government should challenge Ofcom to look again at this scandal and act to help free our telecoms system from an over-powerful and irresponsible owner.