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Friday, 6 October, 2000, 16:27 GMT 17:27 UK
Oftel extends internet probe
UK telecoms watchdog Oftel has threatened 'firm' action over the high costs of surfing the web, as it fights criticism that is has allowed the former monopolist British Telecom to stifle internet growth,

Oftel on Friday extended its review campaign to internet access services for home users and small businesses, after a study found UK rates for surfing the net at peak times were amongst the highest in Europe.

In September, the regulator launched an inquiry into mobile phone sector, and recently heightened its watch on the high-speed, or 'broadband', services used typically by big companies, following complaints that it had been slow to end BT's near-monopoly.

The new enquiry will investigate whether competition among telecoms firms for 'narrowband' users, generally individuals and small firms, is resulting in lower charges for consumer.

Low prices

"Oftel is actively pursuing competition in internet access," the regulator said on Friday. "[We] will act firmly if necessary. Oftel wants to see prices for internet access in the UK compare favourably against the UK's main competitors."

A study released by the Organisation for Economic Co-operation and Development (OECD) two weeks ago showed that the costs of surfing at peak times were higher in the UK than in many other EU countries, including France, Germany, Greece and Italy. Worldwide, peak access was cheaper in Japan, Mexico and Australia.

"We have some work to do here," an Oftel spokesman told BBC News Online.

But log-on costs at evenings and weekends were among the world's lowest. "The US is better than us, but we have the cheapest in Europe," the Oftel spokesman said.

Wide-ranging review

The narrowband inquiry, set to be completed by next May, will review access facilities from users through telecoms networks to internet service providers, such as Freeserve or AOL.

BT engineer
BT engineer at work in an exchange
Following pressure over broadband services, in which BT has a dominant position thanks to ownership of the so-called 'last mile' of copper cable between local exchanges and the computer modem, Oftel has accelerated the timetable for opening the market.

The regulator has given BT until January, wherever possible, to open up exchanges, and allow rival firms to install their own broadband equipment. The deadline was originally set at July next year.

"The matter is receiving Oftel attention on a day-to-day basis," the Oftel spokesman said.

However, European Union officials have called on Oftel to be stricter with BT. They believe the UK watchdog should set tougher deadlines and allow BT less flexibility in giving competitors access to local exchanges.

They warned the UK could drop into the "relegation zone" of European telecoms if Oftel failed to prise open the markets.

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