BT is in talks to open up its infrastructure to a rival in a landmark test of Ofcom’s plan to introduce more competition for its much criticised Openreach network monopoly.
Openreach is in discussions with City Fibre, the alternative broadband network builder, about a large-scale fibre-optic roll-out over BT’s ducts and poles in Southend, according to industry sources. It is understood that BT is currently surveying its infrastructure in the Essex town to get the project under way.
The success of the proposed 50km project could prove crucial to BT’s discussions with regulators over the future shape of the company.
Ofcom earlier this year stopped short of recommending a break-up of the former state monopoly, but said there should be more competition at the infrastructure level. It said BT’s rivals should get cheaper access to the its ducts and poles to make building ultrafast broadband more feasible.
After initial relief that it would not be broken up, BT investors have grown worried that Openreach will cease to provide the strong cash flow it has over the last decade. Sharon White, the chief executive of Ofcom, has said Openreach has made £4bn in “excess profits” over the period and vowed to clamp down.
Fears were stoked by the Government’s response to the Digital Communications Review, which backed the regulator to take “radical” action to curb BT’s power.
The company is due to report full-year results on Thursday in the shadow of its discussions with Ofcom. City consensus predicts total sales of £18.8bn, up 5pc on the prior year, and pre-tax profit of £3.4bn, up from £3.2bn.
