The physical copper wire circuit between a customers’ premises and the telecom company’s local exchange in the local access network is known as the local loop. The local access network is one of the least competitive segments of the telecoms market in Europe. Providing unbundled local loops will increase competition in the local access network, making high speed internet access more widely available.
The government recently stated publicly that it welcomed a new proposed European regulation on unbundling access to the local loop. Telecoms minister Patricia Hewitt said on 3rd October, “"Far from dragging its feet, the UK has been accelerating local loop unbundling. We will be fully compliant with the regulation, and we fully support it." However, Oftel has said that BT has until July next year to unbundle access to its local loop; while the proposed regulation states:
“Notified operators shall make available to third parties, by 31 December 2000 at the latest, unbundled access to the local loop, under transparent, fair and non-discriminatory conditions.”
This is clearly at odds with Oftel’s proposed timetable and, unless the government acts soon, it will be at odds with Patricia Hewitt’s statement of compliance. The proposed regulation also gives Oftel the authority to resolve disputes between BT and aggrieved competitors. FT.com suggests that the government is less enthusiastic with Oftel’s attempts to accelerate unbundling than it has suggested. There is a risk that if Oftel does not act, it will itself face legal challenges.