A report by the Trade and Industry Select Committee (TISC) into the Telecoms Review, by the industry regulator Ofcom, concluded that they are "unconvinced" that the break-up of BT would benefit consumers.The TISC agreed with Ofcom that there is no need to split BT's retail and wholesale divisions, as Ofcom itself had warned, but said that BT might decide to divide itself sometime in the future."We reiterate our opinion that the case for forcing BT to structurally separate has not been made, and that Ofcom's pursuit of genuine equality of access is the best way forward. It may be that equality of access prompts BT to voluntarily separate; however, that is a matter for BT's management and shareholders." Martin O'Neill MP, Chairman of the CommitteeHowever, TISC raised some alarm at the recent proposals by BT to vary prices that are currently applied nationally, so that it can compete in areas where LLU takes off. The cuts of around 8% will only be applied in areas where there is "a combination of high customer demand, high take up and lower costs".While this may seem good news, this means that BT can change it's pricing on it's on products without any intervention from Ofcom, with the effect of changing the economic viability of LLU. Operators planning to install LLU equipment in BT exchanges would have no guarantee of BT's prices, with the threat of BT dropping wholesale prices to undercut them. "BT's decision to 'de-average' wholesale prices - vary them from area to area - has created uncertainty which may jeopardise future LLU plans."""...in the absence of substantial investment in end-to-end networks or alternative access networks, Ofcom's pursuit of Local Loop Unbundling (LLU) is the best way of introducing a more varied broadband market." TISC
