Ofcom says its review of the UK’s digital communications market will be ‘overarching’. It plans to examine competition, investment, innovation and the availability of products in the broadband, mobile and landline markets.
The regulator explained the review would consider wider questions complementary to those addressed by its regular, three-yearly reviews of individual telecoms markets.
It follows comments made in May last year, when the regulator said that the 10th anniversary of their introduction would mark a suitable point to review the effectiveness of rules introduced at the last review.
Steve Unger, Ofcom Acting Chief Executive, said: “We have seen huge changes in the phone and broadband markets since our last major review a decade ago. Only five years ago, hardly any of us had used a tablet computer, high-definition streaming or 4G mobile broadband.”
Ofcom anticipates that it will focus on three aspects in particular:
- ensuring the right incentives for private-sector investment, which can help to deliver availability and quality of service;
- maintaining strong competition and tackling obstacles or bottlenecks that might be holding the sector back; and
- identifying whether there is scope for deregulation in some areas.
Sky group chief executive welcomed the review, but said there were serious questions about whether the existing infrastructure would meet consumer needs. In particular he raised the question of a break up of BT Openreach: “We welcome Ofcom’s announcement of a review of the UK’s telecommunications sector. The sector is vital to the UK’s future but there are serious questions about whether the existing structure can deliver the infrastructure, innovation and choice that consumers and businesses need.”
His point was echoed by TalkTalk chief executive Dido Harding, who said it was increasingly clear the current market structure was not fit for purpose: BT’s proposed merger with EE threatens to make a bad situation worse. It will further starve Openreach of the focus and capital it needs and will extend BT’s dominance of the market. The larger group will have nearly 40% of the entire consumer telecoms market and nearly 70% of the wholesale market,” she said.
In January that it is testing technology for delivering ‘ultrafast’ broadband speeds, with a plan to roll out to most of the UK within a decade. The following month, Virgin Media announced plans to extend its network to around four million new premises over the next five years.
