It seems BT feel they are not in a position to carry forward with some of their upgrade plans unless they get special treatment from OfCom, the UK telecommunications regulator.
http://www.theregister.co.uk/2008/11/17/bt_livingstone_fibre_threat/For several months BT has been pushing the line that Ofcom will have to give it more control over wholesale access and pricing to make investments in fibre worthwhile. Now chief executive Ian Livingstone has issued a threat that even the £1.5bn so far allocated might be imperilled by the economic climate if regulators don't play ball.
Livingstone was quoted in The Guardian on Friday warning that some mean shareholders might not let him spend the money. "But I have to tell you there are some shareholders who say 'you know something, don't do that, don't do a whole lot of other things. That leaves you with a lot more cash and cash today is worth a lot more than cash in a few years' time'," he said.
The implicit threat is "let us run things how we want to, or we might not bother at all". So far BT has committed only to fibre to the premises at the new Ebbsfleet development in Kent, and announced two 10,000-customer pilots of fibre to the cabinet in London and Wales.
This of course wont affect the 24Mb ADSL2 roll-out they are currently working on but will affect any further roll outs of even faster speeds achieved using fibre-optic cable. A recent report stated that the cost of covering the UK completely with a fibre-to-home system would cost approximately 25Bn, the cheaper but less effective fibre-to-roadside-cabinet would increase speeds somewhat but would fall seriously short of delivering the foreseeable future-proof speed fibre-to-home would deliver, the cost of this was about 20% of the larger plan, 5Bn.
Whichever company does end up delivering such a service, its clear they have a large portion of the UK internet demand to fall back on and BT is merely in my view just haggling terms, money sitting idle is not going to earn them any future revenue and investment in proven technology with willing customers is a no brainer.
