"There are some technical issues to overcome, but with concentrated work by the industry and successful trials concluded by the end of 2000, I am confident competing operators can have direct access to BT's network by 1 July, 2000," said Oftel chief David Edmonds.

BT, the former state telecoms monopoly, has been accused of dragging its feet over the vast expense of upgrading its so-called "local loop" copper network, which still links up 85% of homes and small businesses despite years of competition in the telecoms industry.

Fast track solution

The group says it is poised to start upgrading its network with ADSL (Asymetric Digital Subscriber Line) technology, amid mounting demand for speedy data and Internet services - and competition from cable firms, whose networks already handle multimedia transmissions.

Oftel is now proposing a twin-track approach, allowing rival operators to upgrade BT's local phone lines for their own high-speed services without having to wait for BT's own rollout plans, while the telecoms giant also beefs up parts of its network.

Competitive edge

The regulator promises that its proposals will help Britain win a competitive edge over other countries.

"By the end of 2001, the UK will have a better communications network than any other country of which I have knowledge," Mr Edmonds told a news conference.

Although BT said it would co-operate with Oftel and the industry during the consultation period and any trials, it dubbed the timetable "very ambitious" and said plans to allow rivals to upgrade its network were unnecessary.

"It raises significant technical and security issues which will need to be evaluated carefully," the company stated.

'Might as well go home'

One of BT's aggressive US rivals MCI WorldCom - which like companies such as cable groups Telewest Communications and NTL and high-tech Energis - is waiting in the wings for direct access to customers, said it was disappointed at BT's response.

"If implementing competition proves 'too difficult', we might as well all go home," said MCI WorldCom's UK Managing Director Michael Butler.

BT showed willing on Monday by announcing a multi-million pound order for ADSL equipment with Japan's Fujitsu and French telecom equipment firm Alcatel.

The technology will upgrade 400 of BT's 2,800 exchanges in Britain, covering nearly six million households and businesses.

ADSL turns ordinary telephone lines into high-speed digital channels and allows access to the Internet and multi-media services at up to 10 times the speed achieved across copper telephone lines.