CityFibre, the telecommunications firm behind a superfast broadband network in Aberdeen, said yesterday it was ready for the challenge of taking on bigger rival Openreach.
BT is legally separating from its infrastructure arm, Openreach, following an agreement with industry watchdog Ofcom.
The regulator ordered the move in November amid mounting pressure from BT’s rivals.
A “long-term regulatory settlement” will see Openreach become a distinct, legally separate company with its own board, within BT Group.
Around 32,000 employees will transfer to the newly formed Openreach Limited following Tupe – transfer of undertakings (protection of employment) rules – consultation and after pension arrangements are in place.
Openreach Limited – focused on building and maintaining the tens of millions of copper and fibre lines that run from telephone exchanges to homes and businesses across the UK – will have its own branding that will not feature the BT logo.
BT chief executive Gavin Patterson said: “I believe this agreement will serve the long-term interests of millions of UK households, businesses and service providers that rely on our infrastructure.
“It will also end a period of uncertainty for our people and support further investment in the UK’s digital infrastructure.”
Ofcom said it did not need to enforce the change through regulation as BT was acting voluntarily.
Sharon White, the regulator’s chief executive, called it a “significant day” for phone and broadband users and pledged to “carefully monitor” how the new Openreach performs.
But Mark Collins, strategy and policy director at London-based CityFibre, said the move highlighted “the UK’s shocking fibre (broadband technology) gap”’.
Mr Collins added: “Whilst it is welcome that these time-consuming negotiations seem to be at an end, there is nothing in this announcement to suggest Openreach will now start to build the fibre infrastructure this country needs.
“Ofcom’s focus needs to shift to encouraging alternative fibre builders to do the things Openreach can’t or won’t do – whatever its legal status.
“CityFibre is well-placed to take on that challenge and to meet Ofcom’s strategic objective of reducing the UK’s reliance on Openreach to get the job done.
“The substantial (UK) Government funding for fibre announced in the budget this week will help to accelerate our own full fibre roll-out programme.”
CityFibre’s Gigabit City network in Aberdeen allows businesses and hundreds of public buildings to take advantage of superfast broadband.
