'Disappointment' for BT as Oftel rules on leased lines

Claire Gilbert, chairman of the Internet Service Providers Association (Ispa), said: "We have been waiting for regulation [on leased lines] for at least five years. It is vital for the ISP market to thrive."

Oftel issued a draft directive that BT will be required to provide specified wholesale leased lines to other operators on a non-discriminatory basis and arrange prices with operators within two months.

The regulator pointedly did not rule out imposing price controls.

David Edmonds, director general of Oftel, said: "Greater competition in wholesale leased lines is vital to ensure lower retail prices. Operators must be able to compete on an equal footing with BT."

A BT spokesman said the telco was 'disappointed' that Oftel thought the matter needed a directive and that it felt the high bandwidth leased line market was very competitive.

"We shall continue to work with the other operators, who are our valued customers, and try to understand and meet their needs," the spokesman added.

BT has already taken on board Oftel's August condemnation of its policies. In plans for a split, BT pointed out that its broadband service would treat all operators, including BT, in the same way. The telco said at the time the move should make regulation by Oftel unnecessary.

Derek Nicholas, member of the competition and market special interest group of the Communications Management Association, said: "There are problems in this market and action was needed to open it up for healthy competition."