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#Public Sector

BT wants to end Ofcom imposed subsidies to BSkyB, TalkTalk

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BT has asked Ofcom to let is stop providing broadband to its rivals BSkyB and TalkTalk at subsidised rate arguing that the companies have profited enough from the rules designed by the telecom watchdog to open up broadband market to competitors.

BT has asked Ofcom to now promote a level playing in the wholesale broadband market as the telecom regulator has now achieved managed to its goal of bringing competition into the broadband market, which was once dominated by BT.

“Ofcom has successfully created one of the most competitive broadband markets in the world”, notes BT in a press release. “BT’s share of the retail broadband market now stands at around 31 per cent, compared with 41 to 52 per cent for other ex-incumbents in Europe.”

BT Consumer CEO John Petter said that both BSkyB and TalkTalk have profited enough from the Ofcom imposed subsidies over most part of the decade and that both the companies “are more than capable of standing on their own two feet.”

“It is particularly unfair that BT has to give Sky a commercial leg up when they consistently refuse to provide us with fair access to their own services”, said Petter.

Petter credited Ofcom with the success of bringing in competition into broadband market, but argues that the success now “needs to be reflected in current regulation.”

“We know that Ofcom want to tackle this distortion but we want them to act now given this is a highly dynamic and competitive market. All we are asking for is a level playing field where prices reflect costs and consumers benefit as a result.”

BT cited a company-commissioned report from Plum Consulting stating that its competitor have already pocketed profits in tune of £600 million and are closing in on making a whopping £1 billion in unfair subsidies.

BSkyB and TalkTalk are unmoved by BT’s claims. BSkyB said that BT is arguing against “the very principle of regulatory certainty that BT itself argues for when making investments of its own” notes The Financial Times.

TalkTalk on the other hand said: “What BT is actually calling for is for consumers and businesses to pay more for broadband, and for that money to go straight into BT’s pockets.”