BT fined record £42m fine for delayed installations
Written by News on 27/03/2017
The telecoms regulator has imposed a record £42m fine on BT for "serious failings" at its broadband network division Openreach.
Ofcom said Openreach committed a "serious breach" of its rules by failing to pay other telecoms firms, such as Vodafone and TalkTalk, proper compensation over delays in installing high-speed ethernet lines.
Ethernet lines are used by large businesses and broadband providers to ensure fast services and was said by the regulator to "underpin the UK’s communications infrastructure".
The investigation into BT’s conduct was launched after concerns were flagged by Vodafone that it had been misusing contractual terms.
Ofcom’s investigations director Gaucho Rasmussen said: "These high-speed lines are a vital part of this country’s digital backbone. Millions of people rely on BT’s network for the phone and broadband services they use every day.
"We found BT broke our rules by failing to pay other telecoms companies proper compensation when these services were not provided on time.
"The size of our fine reflects how important these rules are to protect competition and, ultimately, consumers and businesses.
"Our message is clear – we will not tolerate this sort of behaviour."
Openreach CEO Clive Selley "apologised wholeheartedly" over the incident.
"This shouldn’t have happened and we fully accept Ofcom’s findings," he said.
The £42m fine is almost 10 times bigger than any sanction previously imposed on a telecoms provider.
Compensation will now have to be paid to affected providers within 12 months, Ofcom said.
BT has estimated the total cost of the compensation payments will be around £300m.
Earlier this month, BT reached an agreement with Ofcom to legally separate Openreach.
It followed growing calls from rivals to hive off Openreach and in November the regulator ordered a legal separation of the firm.
(c) Sky News 2017: BT fined record £42m fine for delayed installations
