No let-up on BT, says Oftel: Watchdog will not be taking a back seat as rivals take market share, reports Mary Fagan

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The Independent Online
DON CRUICKSHANK, the new director general of telecommunications, has warned of continued tough regulation of British Telecommunications for the foreseeable future, in spite of increased competition in the marketplace.

'It will be a long time before competition is effective and settled,' said Mr Cruickshank, who joined the watchdog Oftel in April.

He dismissed BT's belief that regulation should take a back seat as rivals take market share: 'BT's managers have no idea what they are talking about - in that they have no idea what it is like to compete with a monopoly. They have no real experience to bring to that debate.'

He said BT could not understand the anxieties of the shareholders of new telecoms rivals - including cable television companies and start-ups such as Ionica and Energis, owned by the National Grid - when faced with the market strength of BT.

He also rebuffed concerns, often voiced by BT, that many UK cable television companies are backed by huge North American telephone operators. 'I am here to ensure that consumers get choice and quality. The thought that people with market experience are walking the streets of Britain fills me with cheer,' he said.

Although Mr Cruickshank sees further regulation as the way forward, he also admires BT's improvements in quality of service in recent years. He said he was not interested in breaking up BT but would require accounting separation of different parts of its business by the end of the financial year.

This is viewed as crucial in working out fair interconnection charges for rival operators that need to use BT's wires. 'It is very, very important to get this right,' Mr Cruickshank said. 'It is a first stage and there is more to come.'

He hinted a similar approach might also need to be taken with telecoms operators other than BT.

At the same time Mr Cruickshank plans to take a more pro-active approach to regulating BT rather than waiting for people to complain.