Ref: 37/03
Date: 24 June 2003

Oftel has today confirmed that BT’s charges to Vodafone for providing links to connect up parts of its mobile network must be cost oriented.

Vodafone use these links to connect its radio base stations to the rest of its network.

BT will now need to reduce these charges, in line with European legislation which requires that they are cost oriented.

Up until now, Vodafone has purchased these links from BT at retail prices. As a result of Oftel’s action today, Vodafone will now be able to buy them more cheaply, allowing it to manage its network more efficiently.

Chris Kenny, Oftel’s Director of Compliance, said today:

"Oftel has today taken action to ensure that BT will provide Vodafone with links at cost oriented prices, as required under European law.

"This will allow Vodafone to run its network more efficiently and, where appropriate, reinvest the savings in other parts of its business.

"Oftel’s decision is consistent with the new framework it finalised last year for the provision of partial private circuits."

Notes to Editors:

1. A Direction to resolve a dispute between BT and Vodafone regarding wholesale connections between BT’s and Vodafone’s networks (radio base station backhaul circuits) has been published today and is available on Oftel's website at www.oftel.gov.uk/publications/broadband/leased_lines/btvo0603.htm. Hard copies are available to the media from Oftel's Press Office, telephone 020 7634 8991, and to the public from Oftel's Research and Information Unit, telephone 020 7634 8761.

2. Oftel finalised a new pricing and quality of service regime for BT's wholesale business broadband services on 23 December 2002. This followed a consultation Oftel launched in September 2002.