gluke - Fotolia

Ofcom ethernet installation compensation plans spark channel fears

Ofcom's measures against BT's Openreach operation might have consequences for those resellers that provide connectivity and installation services to customers

Just days after BT's Openreach operation was critised by Ofcom and handed a record £42m fine fears have been expressed that compensation plans aimed at softening the blow of bad service to customers will hit the channel.

Ofcom handed out the fine to BT earlier this week and ordered the telco giant to pay £300m to corporate customers for delays in installing high speed lines.

BT's Openreach arm was ticked off for failing to compensate telecom providers for delays to high speed ethernet lines that had been instaled between January 2013 and December 2014.

“These high-speed lines are a vital part of this country’s digital backbone. Millions of people rely on BT’s network for the phone and broadband services they use every day," said Gaucho Rasmussen, Ofcom’s investigations director.

“We found BT broke our rules by failing to pay other telecoms companies proper compensation when these services were not provided on time. The size of our fine reflects how important these rules are to protect competition and, ultimately, consumers and businesses. Our message is clear – we will not tolerate this sort of behaviour," he added.

Going foward there are guidelines that mean that if high speed lines are not installed within a set period, or a customer has not been explained that there could be a delay, then fixed levels of compensation will be triggered.

It is around that compensation that some channel concerns have emerged with Neil Watson, head of service at Entanet, choosing to voice his worries in a blog post.

“Like every supplier in the UK using the BT backbone, we rely on Openreach to fix any faults on the BT network, and conduct any installs. When something breaks on the BT network, or an Openreach engineer doesn’t turn up – why should reseller A (the ‘retail provider’) have to bear the brunt of the compensation claim?” he asked.

“It’s far from uncommon to have issues where Openreach have difficulty finding the root cause of the issue and where it lies (e.g. on which network – BT’s or the suppliers’) or won’t admit that the issue is on their network," he added.

Watson said that he had no problem with the concept of compensation but customers needed to understand that from time to time there might be issues and perhaps more focus could be put on SLAs.

Read more on Finance and Credit