Ofcom unveils regulatory framework to unbundle BT fibre

Ofcom has laid out a regulatory framework to allow operators to have access to BT's fibre lines in order to offer rival services.

While operators are beginning to offer fibre in the UK, Ofcom said there was a long way to go to deliver the networks of the future that the UK needs.

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It said the framework will encourage competition and investment in super-fast broadband for both urban and rural areas.

Through the framework network operators will have access to a dedicated virtual link over new fibre lines laid by BT (known as virtual unbundling). This will give other companies control of the lines to provide super-fast broadband services to their own customers, Ofcom said.

It said BT will be able to set prices for these wholesale products, which should promote investment by enabling the company to make a fair rate of return reflecting commercial risk. These prices will be constrained by the highly competitive wider broadband market and will be subject to rules to prevent anti-competitive pricing.

Talk Talk has become the first operator to unveil its plans to use the BT network, according to a report in the Financial Times. The newspaper spoke to chairman Charles Dunstone who said, "We are working on a commercial launch."

Ofcom's ruling also requires BT to propose plans early in 2011 for opening up its ducts and telegraph poles to allow rivals to lay their own fibre cables in areas outside of BT's fibre network. The aim is to allow broadband providers to offer services in rural areas where BT decides it may not be commercially viable to provide its own links, or where BT's fibre has yet to reach.