BT is trying to win Ofcom’s approval to alter charges for business customers

Some companies’ line and call charges could fall considerably if BT can convince Ofcom that a range of its business services can be offered in a similar fashion by its competitors.

However, an Ofcom spokesman said, "There are a number of specific development criteria that BT must comply with before [price] deregulation will be allowed. Once BT has completed this, which it is due to do through this year, then we will ask [BT’s rivals] are you satisfied with this - ie will the products offered to you by BT enable you to replicate the business services that BT markets to business? In other words, can you compete fairly and directly with BT? If the industry says 'yes, we are now content', then we will deregulate in this area. If the industry isn't content then we won't deregulate."

When asked about how many firms would have to complain for Ofcom to prevent price deregulation, Ofcom said, "That's going to be down to a judgement call on our part. If we feel that the industry is broadly or wholly satisfied, then we will proceed – it's not a voting system, it's a consultation."

In a statement, Tim Smart, BT's UK global services president, said, "BT is pleased that this is a further step in the right direction of deregulation in this market. We understand that deregulation is dependent on us delivering high-class wholesale products to our service provider customers, and we are utterly committed to doing just that."

Jean-Claude Delcroix, research vice-president for carrier operations and strategies at analyst Gartner, said, "Ofcom has set out the conditions BT need to achieve clearly, and until BT answer these complaints the ball is in their [BT's] court. There are a couple of tough issues remaining that BT needs to address… specifically to ‘prove adequate billing accuracy and bill verifiability’ and the ‘potential double payment for equipment cancelled after the FOC [firm order confirmation] point and subsequently deployed in fulfillment of another order’."

Delcroix added, "I think Ofcom has done a good job. We're probably at the 90 percent mark for what BT needs to do, and it will require some work by BT to address the last 10 percent. Are the competitors going to be pleased by what BT will do – well, that's another story. Maybe BT will get close to 100 percent and then Ofcom will have to rule."

If BT is allowed more freedom in pricing it could greatly hurt its biggest rival in the corporate market, Cable & Wireless, which recently decided to focus on very large customers and not on small and medium-sized enterprises. Current Analysis analyst Sandra O'Boyle said, "Big businesses are the one area where BT can make serious money in the UK, especially tied in with Global Services and managed IP and IT services."

However, Cable & Wireless chief executive Jim Marsh issued a statement saying, "Ofcom’s plans to deregulate BT’s activities in the corporate market are markedly premature. Deregulation won't help to improve the service we, and other customers, receive from BT. Indeed, as its largest independent customer, we have yet to see any positive impact from the creation of [BT] Openreach."