BT share price: Chief says current structure helps Openreach improve service

on Jul 21, 2015
Updated: Oct 21, 2019
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Joe Garner, the chief executive officer of BT Group Plc’s (LON:BT.A) Openreach division, has commented on Ofcom’s strategic review of the UK digital communications sector, saying that it should not be “hijacked by corporate rivalries”. The infrastructure unit, which is responsible for four-fifths of broadband connections in the country, has become the focal point of the review, with the communications watchdog considering separating the business from its parent company.

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Last week Ofcom published a discussion paper on possible regulatory approaches aimed at improving competition and quality of service in the digital communication sector. One of the options listed in the paper was splitting Openreach from BT. Ofcom noted that this approach would “remove BT’s underlying incentive to discriminate against competitors” and could also offer ways to simplify regulations. BT rivals such as Sky and TalkTalk have repeatedly called for this measure, which they believe will improve competition, as well as phone and broadband services in the country.

Yesterday Garner dismissed these claims, arguing that Openreach had been improving its services and these improvements would not have been possible if Openreach had not been part of the broader BT Group. Yesterday BT said that the average waiting time an available appointment date for a new installation had fallen to seven days in the second quarter of the year, from eight days a year ago. The company also fixed faults within the agreed time about 77-percent of the time, up from 75 percent in the previous year, and more than 99 percent of installation appointment dates were offered within the 12-day target.
In today’s trading, BT shares were flat at 479.02p, as of 10:10 BST. The stock has surged 19.3 percent since the start of the year and the company’s market capitalisation currently stands at £39.9 billion.
The 18 analysts offering 12 month price targets for BT have a median target of 516.50p, with a high estimate of 600.00p and a low estimate of 355.00p.
As of 13:18 BST, Tuesday, 21 July, BT Group plc share price is 478.45p.

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