BT casts doubt over landline levy

Saturday, July 4 2009,

By Andrew Laughlin

BT has said that the government's proposed fixed line charge will not be sufficient to fund its next generation access broadband plans, according to reports.

A 50p tax on all UK fixed lines was recently proposed in the Digital Britain report to generate an estimated £1 billion over the next decade.
This cash will primarily go towards funding the final third of NGA plans, which refers to the 'last mile' connection between main broadband networks and the consumer.

Speaking at a briefing held at BT's London head office, the firm's director of strategy and profile Olivia Garfield said that the levy is a "reasonable" charge to pass on to households.

However, she added that there is a "question mark" over whether the funding generated from this would go far enough towards meeting the government's objectives.

"If [the charge] is for the final third, we would be very surprised if that could cover it," she told a round-table discussion at the event.
"All our modelling shows differently. We can see a way to get to 80 to 85 percent [coverage] with that number, but it would be impossible to get to 100 percent."

Garfield also revealed that BT had no input during consultations on the landline tax and only heard about the proposal after the press announcements.
The telecoms giant will now be involved in a bidding process in order to decide who gets access to the public funds for network build projects.

Meanwhile, Sky has slammed the landline levy as a "telephone licence fee" and the "last thing" that the UK needs right now.
The satellite firm also said that any public subsidy for fibre rollout should not "discriminate in favour of any company".