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Introduction

On 22nd September 2005 Ofcom decided, instead of making a reference to the Competition Commission, to accept undertakings from BT to address a number of competition concerns in the telecoms markets . This report, the third in a series of quarterly reports, provides information on BT’s progress toward implementation of its Undertakings.

In each area of the Undertakings, this report describes:

• relevant sections in the Undertakings and the primary owner;
• progress made by BT and/or Openreach towards delivering on its commitments (and, where relevant, relevant activity by Ofcom and others);
• future commitments in the Undertakings that need to be delivered and dates/milestones where these are specified; and
• any major outstanding issues or risks that have been identified to date.

To maintain clarity within the document, milestones which have passed, and on which there are currently no significant open issues, have been moved into Annex 1.

The aim of each report is to provide an up-to-date statement of recent progress and does not, therefore, contain the content of the previous report in an unedited form. Readers are therefore urged to read previous reports for information on progress prior to the last quarter and a more complete picture of overall progress.

It should be noted that whilst the implementation reports describe BT implementation in respect of its Undertakings, any statements will not be definitive as Ofcom can only reach a definitive view of compliance by undertaking the full process of enforcement action. Any statements made by Ofcom are based on the information currently before it and will not, and can not, prejudice the outcome of any enforcement action should a complaint be received or further information come to light.

Where reference is made to the content of the Undertakings, particularly in relation to future commitments/deliverables, in the event of any difference between this document and the Undertakings the text of the Undertakings takes precedence.

Alongside this document, Ofcom is also publishing a summary of the survey of BT’s wholesale customers carried out by Spectrum Strategy Consultants on Ofcom’s behalf . The survey was intended to go beyond assessing delivery to the letter of the Undertakings. In particular it focussed on how wholesale customers felt they were being treated as a customer of BT and included a view of delivery to the “spirit”. The interviews were conducted during March and April, i.e. six months after the signing of the Undertakings. The main messages in this report are as follows:

• Not much has changed so far, but it is still early days.
• Openreach’s management is enthusiastic, credible and approachable – however, Communications Providers’ (CPs) views on whether it will be able to deliver on its promises were cautious and there was a concern that the organisation might fail them.
• Within Openreach, there have been several teething problems related to the complexity of the restructuring involved in setting up the organisation, particularly account management, service delivery and EMP progress.
• Whilst most of Openreach’s customers appreciate that the pace of change has been such that there were bound to be teething problems, many stressed that the honeymoon period is now ending and that they required significant improvements within the next six to twelve months. Priorities include scaling up staffing and ensuring basic service delivery.
• The level of trust in BT Wholesale is lower than that for Openreach, and there is a particular concern over the 21CN consultation process.
• The majority of respondents outside BT felt that Ofcom should remain closely involved in the implementation of the Undertakings and the 21CN debate.

On Friday 28 April BT published its quarterly set of product key performance indicators. Included within that is a set of product KPIs, intended to compare product performance between BT’s external and internal customers.

More information on progress on implementation of the Undertakings is available on the Ofcom website at: http://www.ofcom.org.uk/telecoms/btundertakings/ and on the BT website at: http://www.tsrbulletin.com/

Should you wish to discuss this report, or have comments on it, please contact Graeme Hodgson on 020 7783 4417 or via email to: graeme.hodgson@ofcom.org.uk

• BT Undertakings - Third quarterly report [pdf]
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