OFTEL Shifts Gears on Telecom Regulations

The Office of Telecommunications
Policy (OFTEL) this week introduced its new approach to regulating the
telecommunications market in the UK.

The heart of OFTEL’s strategy is to roll back formal regulation where
competition is effective and already protects consumer interests.

OFTEL is counting on increased self-regulation by industry leaders and
co-regulation where some competitive encouragement is required. The UK
regulatory agency also intends to thwart, if not prohibit, anti-competitive
practices in the telecommunications market.

In order to encourage competition, OFTEL plans to carry out a series of
major reviews analyzing key sectors of the telecom market over the next few
years. The reviews will include benchmarking against other countries to see
if UK consumers are getting a deal at least as good as those abroad.

David Edmonds, OFTEL director general, said the deregulatory approach to
the telecom industry is the most significant change in OFTEL’s approach to
regulation since 1984.

“As telecoms markets become more competitive OFTEL needs to review its
approach to regulation,” Edmonds said. “Up to now regulation has focused
on opening up a previously monopoly market, to promote competition and
protect consumers. OFTEL’s new approach is to focus on effective
competition which gives the customer the best deal.”

Edmonds said the strategy shift means that competition is key to providers
consumers with the best possible telecom services.

“OFTEL’s new strategy is therefore one of ‘competition plus.’ This means
effective competition to protect consumers’ interests wherever possible,”
Edmonds said. “But where there is not yet effective competition or where
consumers need extra protection, then OFTEL will regulate, with as light a
touch as possible.”