Cable & Wireless calls for industry restructuring

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CABLE & Wireless has called for a complete restructuring of telecommunications regulation in the UK, alleging that BT is still free to abuse its dominant position in the market.

Lord Young of Graffham, C&W's chairman, said regulation had failed to give operators, including its Mercury subsidiary, fair access to BT's network - which they need to deliver calls or other services - on acceptable terms or at a reasonable price.

At the same time, regulation had failed to keep up with the development of technology and changes in the market, Lord Young said.

But the company said that if a fairer system was introduced, the Government should lift the restriction on BT that stops it sending broadcast television over the telephone wires.

Until now, C&W has been a supporter of the ban, which BT says could prevent it from building a pounds 15bn network to deliver multimedia services throughout the UK. But in evidence to the Trade and Industry Select Committee, Lord Young said: 'We would give up the benefit of BT being unable to deliver TV if they would give up restrictions they impose on us.

'The current regulatory framework should be reformed to remove all barriers to competition and to ensure that BT and all the other telecommunications operators are unable to abuse their market power or otherwise engage in anti-competitive practices,' he said.

Lord Young said that reform would restore Britain's leading position in telecommunications regulation and bring a variety of services from television and home shopping to long-distance medical care to homes and businesses throughout the UK.

Oftel, the regulator, recently announced a more open approach to BT's charges for rival operators to use its wires. But C&W and others argue that Oftel's efforts are insufficient and will take years to have any real effect. Lord Young said the result was that the companies keen to deliver a range of services to the home over the telephone network were being unnecessarily held back.

The cable television industry later attacked Lord Young's view that the ban on BT delivering television could be lifted.

The Cable Television Association said removing the restriction could stifle investor confidence in cable and kill plans in the industry to invest pounds 6bn by the end of the decade.