BT broadband rival CityFibre submits complaint over EE bid – report

UK-based broadband infrastructure specialist CityFibre has submitted a complaint to the Competition and Markets Authority (CMA) saying BT’s proposed acquisition of EE will be anti-competitive and damage the government’s ‘ultrafast’ broadband roll-out plans, a report has claimed.

According to the article, the fibre provider’s letter was handed in to be looked at as part of the first phase of the regulatory assessment of the bid. The firm is said to be particularly concerned about its own deal with MBNL, EE and Three’s network sharing venture, to provide fibre-optic link between mobile masts. The agreement was signed in November and a pilot has already been run in Hull.

Meanwhile BT has apparently said it would look to cut costs as soon as the takeover is finalised by connecting the network with its own infrastructure. CityFibre CEO Greg Mesch was reported saying this effectively means its deal with MBNL had been killed off.

Apparently CityFibre also sees the option of obliging BT to offer rival retailers access to Openreach’s ‘dark fibre’ as anti-competitive. The firm claimed this would set CityFibre and Openareach as more direct competitors, which it said would be damaging to the market.

CityFibre, Sky and TalkTalk want regulators to force BT to break up with Openreach entirely instead. Further, CityFibre also said MBNL should at the very least be made to buy connectivity independently of BT.

Responding to the Chancellor’s telecoms investment promises during his budget speech last week, Mesch said: “In infrastructure terms, the UK communications market is under performing, with one of the lowest shares of fibre-connected buildings in Europe, a result of a decade of underinvestment by BT. Investment in fibre infrastructure is critical for sustainable economic growth and future prosperity.

“Therefore, it is vital the government does all it can to encourage a competitive environment for fibre investment. CityFibre is one of the few companies that is both investing and building truly next generation ultrafast infrastructure with our rollout of UK Gigabit Cities. The CityFibre model is already stimulating ultrafast rollouts in York with the joint venture with Sky and TalkTalk and in Hull with Ultrafast dark fibre roll outs to mobile masts for Three and EE.”

In other BT related news, the telco is reportedly about to launch a 4G consumer mobile service over EE’s network this week. The report claimed the service, understood to be called BT Mobile, will be SIM-only and will aim to undercut operators O2, Vodafone and EE.

However, it is likely BT has decided not to go quite as low in pricing as perhaps originally planned to avoid starting a full-blown price war ahead of re-entering the market as an MNO itself. With this in mind, packages are not expected to be as affordable as some offered by Three and Giffgaff.

BT has also previously made plans to offer consumer mobile services, including data and calls, by utilising its 5.4 million wifi hotspots instead of 4G networks. But as reported in October, it seems the telco had encountered technical problems in the technology to do this.

Despite the BT Mobile launch reported to be so close, the telco is apparently not planning a heavy marketing campaign until the end of the current football season this summer. The report said the service will then be sold as part of a bundle with pay-TV services, which will include exclusive Champions League and Europa League football coverage.

As has been clear for some time, BT is clearly determined to become a quadplay operator. Although the telco is intending to return to the mobile market as a fully-fledged operator through the EE bid, it is understandable it wants to launch an MVNO service in the meanwhile to try and reap as much out of the football rights it recently paid for a record amount. With a consumer mobile offer to boot, it probably hopes its bundled offers can draw in more customers.