BT has declared it will invest £6bn in its broadband and 4G coverage in the UK. This news comes as the company is locked in talks with Ofcom regarding the fate of network infrastructure wing Openreach. The news was announced alongside its annual financial results which showed a a 15% rise in pre-tax profits to £3bn.
The investment would be part of a three-year strategy to bring superfast broadband to 10 million homes and businesses via its G.Fast programme. It would also see BT hire another 1000 engineers.
BT also pledged to lay fibre optic lines to around two million premises across the UK – with investment focusing on new housing developments, high streets and business parks through the replacement of ageing copper wiring.
However, Group CEO Gavin Patterson has said the investment is subject to “regulatory certainty.”
As Patterson dangles investment and jobs over Ofcom’s head which way will they sway? This isn’t the first time BT has threatened to halt investment plans if regulations don’t go their way.
BT has recently come under pressure to invest more as rivals claim a conflict of interest with BT’s wider business interests have created an unfair landscape in which to compete.
Firms such as Sky, the owner of Sky News, and Virgin Media have accused the regulator OFCOM of not going far enough in a recent review of Openreach’s operations which stopped short of recommending the division was split from BT though a final decision is yet to be taken.
Patterson commented, “Customer expectations are increasing all the time and we need to work hard to meet those new demands.
“That is why contact centre work is being returned to the UK and why Openreach is aiming to halve the number of missed appointments within a year.”
Greg Mesch, CityFibre Chief Executive, commented on the news, “This announcement is simply a reluctant response by a sluggish incumbent to the tightening noose of regulatory scrutiny. While intended to grab headlines on infrastructure commitment, BT’s announcement is largely signposting continued deployment of outmoded technology.
“While any business constructing pure fibre infrastructure for our nation’s homes and businesses should be encouraged, focusing on the entrenchment of an incumbent operator overlooks the essential contribution of alternative infrastructure builders like CityFibre.
It is only through the growth of alternative operators and the stimulation of a truly competitive infrastructure market that the UK will see the innovation and better value services it so badly needs.”