Executive Summary
1.1 On 22nd September 2005, BT Group plc ('BT') offered and Ofcom accepted a set of undertakings ('the Undertakings') pursuant to Section 154 of the Enterprise Act 2002 in lieu of a reference of certain markets to the Competition Commission. The acceptance of the Undertakings was aimed at addressing Ofcom’s competition concerns in these markets through, inter alia, the implementation of what has been termed “Equality of Access” for all communications providers.
1.2 The physical separation of Operational Support Systems ('OSS') currently shared between Openreach and the rest of BT is a key part of Equality of Access as it reduces the capability and incentive of BT for non-price discrimination. As such Section 5.44 of the Undertakings requires BT to:
- Physically separate Openreach Operational Support Systems from the rest of BT by 30th June 2010;
- Design all new Openreach systems to be separate from the rest of BT;
- In the interim, until full physical separation is achieved, deliver a logically separate Operational Support System capability for certain product groups according to binding milestones; and
- Review regularly with Ofcom a roadmap for achieving physical separation by 30th June 2010.
1.3 In reviewing BT's roadmap, Ofcom gained an increased understanding of the challenges that the physical separation of Operational Support Systems represents. As a result of the review, Ofcom consulted on proposals to vary Section 5.44 of the Undertakings. The aim of the proposed Variation was to strengthen the effectiveness of the Undertakings in the long term by introducing a series of binding interim milestones from now until the completion date of 30th June 2010. These binding milestones would enable progress towards physical separation to be measured at key stages in the programme, thereby providing visibility of, and the opportunity to mitigate, any risks that might jeopardise either the final delivery of full physical separation by 30th June 2010, or the customer experience in the interim.