Monday, May 11, 2009

BT Model for United States?

Competitor mandatory wholesale access to voice and broadband access services has been good for BT and the United Kingdom, and might be useful in the United States, says Sir Michael Rake, BT chairman. Though rules are not completely finalized for new optical access lines, BT's massive loss of market share in the landline voice and broadband access markets has forced the company to be more aggressive about new services, he says.

"It was painful at the time but has been better for the country and consumers in the long run," Rake says.

Today, BT generates annual revenues of about 20 billion British pounds, the same as five years ago. Accounting for inflation and new services, one might argue the results have been negative for BT, as good as they have been for retail consumers.

The average speed for broadband access has nearly doubled to 2 megabits a second and the price for service has been reduced by an average of 50 percent from five years ago.

The best way to get more people to adopt high-speed Internet is to create competition through a regulatory framework that forces the biggest players to open their networks, Rake argues.

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