Telecom firms rage at US delay: American foot-dragging over licences alarms DTI

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The Independent Online
BRITISH TELECOM and other UK telecoms bodies are seething over the Department of Trade and Industry's failure to open up the lucrative US market, accusing it of being outmanoeuvred by the Americans on reciprocal concessions.

The DTI, headed by Michael Heseltine, is concerned that the Federal Communications Commission, the body that licenses telecoms companies to operate in the US, has been dragging its heels over access for UK companies.

Three weeks have passed since the DTI issued a licence to Sprint, the US telecoms operator, permitting it to operate in the UK. The DTI has already licensed a number of regional Bell operating companies to run cable franchises offering entertainment and telecoms services.

By contrast BT, which applied 18 months ago for an international simple resale licence so it could resell surplus capacity, has yet to receive a response from the FCC.

'That application is still pending. We are looking at it in the broader context of other issues, including equivalency, but I cannot give you a timeframe for making the decision,' said Wendell Harris, an FCC spokesman.

The DTI admits it is now anxious about the delay. 'We are concerned about the length of time the application is taking,' said a spokesman.

However, the UK telecoms industry believes the DTI has been at best naive in its dealings with the FCC. The Telecoms Industrial Association, which represents manufacturers, suppliers and network operators in Britain, has been lobbying for equivalent access rights and rules on ownership. Foreign shareholdings in US telecoms companies are restricted to a maximum of 25 per cent.

BT's proposed 20 per cent stake in MCI, the second biggest long-distance carrier in the US, falls well within this limit. But even so, it has been delayed by a judicial request to restructure the deal. By contrast, several cable companies in the UK are solely owned by the so- called 'Baby Bells'.

The TIA believes equivalence of access and ownership is vital to the long-term health of BT and other British telecoms companies. 'There must be a balanced global telecoms market, and a level playing field,' said a TIA spokesman.

'We'll certainly be stepping up our activities now that Sprint has been awarded a licence in the UK,' he added.

Several MPs share this view. 'I'm all in favour of trying to promote telecoms competition in this country, but we should at least expect that there are reciprocal arrangements for BT in the US,' said John Whittingdale, Conservative MP for South Colchester and Maldon.

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