I promise to stop soon, really. But one last BT article. Please?
The proposed OFCOM regulatory regime for BT of “equivalence” won’t work. The concept is that the retail arm of BT will be treated the same as any other outlet by the wholesale arm that runs the network.
Chinese walls work in the financial industry — for example between equity research and brokerage — because what you’re trying to prevent is time-sensitive operational data leaking across. You’re trying to keep a secret. The CEO probably doesn’t know or care about most of the secrets, and doesn’t have to file half in her left brain and half in her right brain.
Telecom is about sinking capital and then trying to wring out the value of the bits that pass over the network. There aren’t many operational secrets. So when BT Retail investment project A lands on the CEO’s desk, and BT Wholesale project B gets dumped on top for approval, they can’t be considered separately. The retail strategy will always be considered in the light of the wholesale one and vice versa. The retail arm will always have a head start on outsiders.
This approach from OFCOM will only serve to highlight BT’s world-class abilities at regulatory capture. Real structural separation is needed. This may even go further than a two-way split. Why not create a scheme by which individuals or communities can effectively recapture control of their loops and exchanges with reasonable recompense to the BT shareholders?
Posted by Martin Geddes at 09:28 PMTrackBack URL for this entry:
http://www.telepocalypse.net/cgi-sys/cgiwrap/mgeddes/MT/mt-tb.cgi/356.
Listed below are links to weblogs that reference Big Telco, Bad Telco:
»
Telecoms Political Economy from Business Organization Management
The role of the regulator is partly to sustain economic forces (competitiveness) and ethical forces (fairness, value for money) in the face of social/political games. And partly to sustain the overall viability of the ecosystem in the face of social/ec...
[Read more]
Never underestimate the internecine office politics within former monopolies. I've worked at an incumbent Telco's ISP arm (FT/Wanadoo). The wholesale arm seemed more preoccupied with bringing the upstart ISP to heel and getting us to accept its proposed ATM-based backbone than with actually helping us compete.
This dysfunctional behavior can effectively negate any internal synergies in terms of early notice of network plans.
Posted by: at December 8, 2004 01:39 AMYou're right, but relying on the disfunctionality of the incumbent telco is no way to run an information-fueled society.
Martin
Posted by: at December 8, 2004 07:09 PM"relying on the disfunctionality of the incumbent telco is no way to run an information-fueled society."
Actually if the incumbents weren't dysfunctional there'd really be no problem with them and an information-fueled society.
The failure of the incumbents to recognise any other strategy than intransigent resistance and colossal mercentary grasping has done much to foster "routing around damage" solutions by customers.
Customers peering directly has been encouraged by dysfunctional interconnect attitudes and tariffing by incumbents, and the resistance to LLU (Local Loop Unbundling) will IMHO in the long run drive the development of the Open Neutral Peering exchange, with its innate choice of "Last Mile" and independent selection of "Service Provider" and render the CO (Central Office) as appealing as the garden of the selfish giant. (http://www.amazon.co.uk/exec/obidos/ASIN/0140503838)
While I would hate Telepocalypse to go away, it might be worth contemplating Napoleon's dictum: "Never interrupt your enemy when he is making a mistake."
Posted by: at December 17, 2004 12:48 AM