Sir Iain Vallance, chairman of BT,
Tuesday hit back at critics of the telco’s stance on
Internet pricing and the introduction of broadband technology.
It was time
to
face economic and commercial realities, he told delegates at the
Telecommunications
Managers Association conference in Brighton.
Sir Iain’s comments were made just as the Office of Telecommunications
was announcing that BT would be required to make its local telecoms lines
available to competing operators, thus enabling other companies to
introduce high-speed, unmetered services directly into the home.
BT has come under fire from members of parliament, industry, the press and
the Internet-using public for holding up the introduction of high-speed
services and not offering unmetered access. Sir Iain insists that BT is
right and, in a hard-hitting and persuasive speech, that everyone else
is wrong.
“Everyone, no matter how inexperienced, claims to know better than BT,” said
Sir Iain, first addressing the broadband issue.
“BT has been a pioneer in ADSL from the start. Much of the technology was
invented by BT, we chaired and led the ADSL forum, we lined up the
manufacturers and drove common world-wide standards.”
However, Sir Iain insisted that the planning and timing of the introduction
of high-speed services via ADSL was vital to the success of the project.
He compared those who want to adopt the technology quickly as being like
“over-exuberant children” who need to be stopped from “dashing across
the road at will.”
The prospects for broadband now look more promising than they did a
few years back, said Sir Iain. As a result, BT is currently equipping
400 exchanges which will provide coverage for about six million homes
in the UK by spring next year.
As for Internet pricing: Sir Iain said that BT’s new BT Together scheme
divided Internet call revenues with 84 per cent going to the terminating
operator and the ISP, 15 per cent in Value Added Tax to the Chancellor
and only 1 per cent to BT. Yet the only bill the customers see, he noted,
is the total bill from BT.
“In effect, the regulatory rules for calls to the Internet promote BT
into the role of tax collector on behalf of the other interested parties.
We gather the money. We hand it on. And we take the flak.”
Sir Iain warned that if and when the regulations are changed, many of
the so-called “free access” ISPs who derive revenue by stealth from
BT will have to change their own business models in order to survive.
In any case, he noted, the widespread introduction of ADSL would have
very much the same impact.
