Profitability for BT's planned £1.5bn high-speed fibre broadband network is assured, says telecoms regulator Ofcom.
BT has said it will invest in the proposed fibre network only if it can make an adequate return by selling capacity to other telecoms operators.
Ed Richards, chief executive of Ofcom, has given the assurance that a new regulatory framework to be published next month will not be a barrier to this kind of investment, the Financial Times reports.
According to Richards, the coming regulations will enable companies to make a return which justifies the investment they are making.
BT stakeholders are looking for new revenue generating opportunities after the company reported an 81% drop in pre-tax profits for the third quarter.
The company blamed poor cost control in its Global Services division. The division saw sales rise 15% to £2.2bn but an operating loss of £501m.