Virgin Media to Break BT Wholesale Monopoly?
There was always this question, even in the minds of the broadband experts of the UK that was not BT moving like a juggernaut in the broadband wholesale sector. This was all the more strengthened by the blanket permission extended to them by the telecoms watchdog of the country, Ofcom a couple of months back. It was also apparent that even the authorities had a hint of suspicion over the giant ISP’s unlimited power, when Ed Richards, the Ofcom chief stated in a briefing that mobile broadband was expected to keep the fixed line segment’s tendency to monopoly at check.
However, the second big name in the picture, Virgin Media who even at the time of BT’s launching its fibre network had already been offering a 50Mbps service through its fibre lines, has lately entered into hot business by announcing its plans to try its hands out in the broadband wholesale segment. Even though a bit late, it seems that Virgin Media has realized that BT’s broadband wholesaling to its rivals is one tactic that can be practically emulated to earn rich dividends. Virgin Media’s wholesale plans were reported by Guardian, saying that by opening this gate Virgin Media could not only garner much increased revenue, but also slash the costs for its own subscribers.
At present, BT covers much of Britain’s ADSL broadband that is copper-based, and therefore is believed to play the most important role in the digital future of the country. Virgin Media’s current decision to open its network to its rivals, carries much importance for the fact that BT was, a few years back forced to unbundled its networks for its rivals by the government. Here, Virgin Media could gain much by entering into the good books of the government. Virgin Media can engage NTL Telewest Business to realise these plans similar to BT’s using its Openreach subsidiary, through a strategic spin off that does not attract the scorn of Ofcom.
In the other fields to Virgin Media is streets ahead of its rivals, especially considering its 200Mbps service trials at Ashford in Kent. This is all the more important at a point of time when most of its competitors are still battling it out with a 24Mbps broadband service.
