29 July 2016
Earlier this week, Ofcom outlined major reforms to deliver better broadband for people and businesses across the UK.
On the whole, the UK has performed well to date. Nearly nine in ten homes can get superfast broadband and speeds have increased dramatically from the dial-up days of a decade ago.
But improvements cannot come quickly enough for people who still suffer from poor, dismal or non-existent broadband. I share their anger and frustration. I hear first-hand about people’s problems with sluggish broadband or days lost sitting at home, waiting for an engineer who doesn’t turn up.
For many, the effects can be profound. To a small business, reliable broadband can mean the difference between survival and failure. For the elderly or vulnerable, broadband can be a lifeline preventing social isolation. So we must improve people’s connections.
We’re in the middle of a major review of the communications market to make sure this happens. Our plans are about giving telephone and broadband users the service they need and deserve. I want everyone, whether they’re in a city high-rise or a rural hamlet, to enjoy the benefits of decent broadband.
It will mean faster, more reliable broadband. Engineers arriving quickly, on time, to install lines or fix faults. New, fibre-optic broadband cables to the doorsteps of homes and businesses, so the UK has the connections it needs to be a leading digital economy.
And when things go wrong, phone and broadband companies should provide automatic compensation. That would mean a cheque in the post or credit on your account - without having to ask. We are discussing with companies how this would work.
We also need a fundamental shake-up of Openreach, the BT company that runs the UK’s largest telecoms network.
This reform, the biggest in Openreach’s history, would make it a distinct company, legally separate from BT. We believe Openreach should have its own Board, obliged to serve all the UK’s telecoms companies equally.
Openreach should consult all of its customers on big decisions, not just BT. An Openreach working for the entire telecoms market, not its owner’s interests, can deliver improvements to broadband that homes and businesses need. This is fundamental change and we will keep the pressure on Openreach to make sure it happens.
Some people think we should go further, splitting BT and Openreach completely. On paper, that looks like a simple solution to people’s broadband woes.
But I’m convinced that our plan will give us the vast majority of the benefits but without risks and delay. Selling off Openreach would mean very significant disruption and costs, not just to BT but to the wider telecoms industry and consumers. It could mean too much time and money spent wrangling, which would be better used improving the country’s broadband.
If split, BT would have to spend time and potentially billions restructuring the UK’s biggest private pension plan, and renegotiating thousands of land contracts. Do we want them to do that or invest in its network, reforming Openreach quickly and efficiently, so that it works for everyone?
We need better service and more investment now. The UK cannot wait for better broadband.
Once agreed, our reforms would take months, not years, to take effect. But they would still provide what Openreach needs - more independence from BT and the ability to work everyone. And for those who argue that our powers would be greater once we leave the EU, I’m clear that we have the powers to act today.
What if we don’t see the improvements we need? Quite simply, if Openreach fails to up its game, we will return to a plan to break up BT and Openreach, however difficult.
Our plan for better broadband goes wider. We’re also promoting more choice for customers by making Openreach open up its network of telegraph poles and underground tunnels to allow rivals to build their own, advanced fibre networks, connected directly to homes and offices. This will reduce the country’s reliance on Openreach.
So no-one gets left behind, we’re implementing the Government’s new universal right to fast, affordable broadband for every home and business. We’re working on tougher rules on fixing faults, quicker repairs and installations. We’ve already made it easier for people to change provider on Openreach’s network, and if broadband speeds fall below what people are promised, they can walk away from their contract.
Openreach is often a lightning rod for people’s frustration for poor service and all companies need to do better. We already reveal the most-complained-about providers and plan to do more to show the best and worst, so customers can shop around with confidence.
Improving broadband for people and businesses is at the heart of our plans to make communications work for everyone. We’re working hard to make that happen.