The Battle between BT and TalkTalk

Posted by Karen on Sep 26, 2014 12:00:00 AM
Improving Internet speeds across the UK is proving to be a longwinded process as certain companies are currently monopolising the market and failing to provide their customers with adequate services. BT in particular has been criticised for providing sub-standard Internet speeds, which is why the regulatory body Ofcom has recently launched an investigation into the ISP.

Unsurprisingly, BT Openreach (BTOR) customers have welcomed the investigation into the company, however other ISPs such as TalkTalk have also voiced their approval. In fact, TalkTalk has gone so far as to say that if Ofcom forces BT to lower their wholesale costs they will subsequently lower their fibre broadband prices. Dido Harding, chief executive of TalkTalk, said: “Not enough people take fast broadband. BT is charging double what it should. We pledge to pass on any price cuts to customers to expand fibre.”

However, a spokesperson for BT has rejected Harding’s accusations and said: “TalkTalk are after a free ride when it comes to fibre despite having their initial complaint rejected by the UK broadcast regulator Ofcom. BT’s wholesale fibre prices are among the lowest in Europe and TalkTalk have benefited from those to make a profit from fibre. The UK would be much better served if TalkTalk invested themselves rather than playing regulatory games to try and keep the UK stuck in the copper slow lane.”

The battle between BT and TalkTalk is mainly based on who has what percentage of the market share, however this is just one of the issues that Ofcom is addressing in their investigation. Ensuring that UK businesses adhere to competition laws is just one way to make sure that individuals and businesses receive adequate Internet connection speeds, however there are also other issues that need to be addressed. Discussing their investigation into the UK broadband market, Ofcom said that they are concerned that SMEs are being impeded by slow Internet connections.

In their report they stated: "Large businesses are typically able to secure good outcomes by virtue of their scale and a highly competitive market to supply services to them. Ofcom is concerned about whether or not similarly good outcomes can be achieved by SMEs. Better availability for SMEs as well as residential consumers is a priority. Communications services like broadband and mobile can be particularly important for businesses in rural areas.”

The report went on to note that in the future the regulatory body will be working with Advisory Committees in areas that struggle with rural broadband issues, and added: “This will help shape future policies to support small businesses at local and regional level.” Meanwhile, Ed Richards, Ofcom's Chief Executive, said: "Our work will help ensure the market is delivering for businesses of all kinds and to make sure that the right protection is in place for them if it isn’t.”

Last month BT attempted to assure both their customers and industry regulators that they are taking their responsibilities seriously by publishing a plan on how to improve their fibre services, however they did not issue a time frame for completion. Unfortunately, this means that other ISPs will continue to struggle to provide their customers high speed Internet connections, especially if they use BT phone lines.

Fluidata already works with over sixty five ISPs in order to offer our Service Exchange Platform (SEP) solution that resolves the issue of rural broadband across the UK. However, without the largest providers in the country providing adequate services the issue cannot be resolved in a short time frame. Hopefully, Ofcom’s report will encourage more competition in the UK’s Internet sector and ultimately improve speeds for both individuals and SMEs.
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