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Virgin and BT team up against threat of Openreach split

Major business rivals join forces to fight Ofcom proposals

19 Sep 2016

Virgin Media, one of BT's biggest rivals, has joined the company in battling against a possible Openreach split.

Running in national broadsheet newspapers, a joint ad campaign will focus on the fact that the average download speed in Britain is faster than in many other EU countries.

It also adds that broadband speeds in the UK have "more than quadrupled" over the past five years, claiming that this is thanks to investments of over 15 billion by the two companies.

"BT and Virgin Media may be commercial rivals but we both have a proud track record of investing billions of pounds in the UK's digital infrastructure," BT CEO Gavin Patterson told The Telegraph.

"It's important post-Brexit that we don't talk the country down and that the right climate exists for further investment."

Together, BT and Virgin Media own and operate the entirety of Britain's broadband cable network. Aside from Virgin, all other internet service providers piggyback on BT's Openreach network to provide internet access to their customers.

Communications regulator Ofcom called for the division to be reformed, outlining proposals in July that would see Openreach become a "ring-fenced, 'wholly-owned subsidiary' of BT Group, with its own purpose and board members". By doing this, Ofcom hopes to remove any possibility that BT could bias against its rivals who rely on the network.

This legal separation, Ofcom claims, would give it more control over its investments and make the market more competitive "without incurring the costs and disruption... associated with separating the companies entirely."

Rival companies that currently depend on Openreach cables say that if Openreach and BT separate, they will be able to invest in upgrading the network, meaning better speeds and increased reliability.

IT Pro has approached both BT and Virgin Media for comment, but had received none at the time of publication. Ofcom's proposals are open to public consultation until 4 October.