Following the broadband money

Virgin Media quits Westminister broadband after cancelling BT contract

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Virgin Media has confirmed that it will not provide retail broadband to the Westminster area in London following a decision to cancel its leased BT network contract at the end of the year because of unacceptable terms.

The decision does not affect a £190m deal Virgin Media Business signed in June with the Westminster City Council to provide a 1Gbps fibre-based public service network. Nor will it affect the prestigious London Grid for Learning contract, which connects all London primary and high schools.

In a statement to Br0kenTeleph0n3, a Virgin Media spokesman confirmed the decision to end the loss-making service. He said said, “Westminster is an unusual area in that we don’t own the infrastructure. Instead we have leased it off of BT since pre-NTL days.

“Unfortunately this has meant we can’t upgrade the service – we’re limited to analogue TV and up to 50Mbps broadband as well as no phone services. The terms are such that we have decided, as of January 2012, to cancel our contract with BT. We are notifying local residents now so they have plenty of time to arrange alternative provision.”

Virgin Media and BT have been fighting tooth and nail, particularly over the provision of metropolitan networks that are run either as managed networks or sold on a wholesale basis to internet service providers.

According to industry sources, it can beat BT in towns because it can rent fibre from Virgin Media Ltd, which owns the fibre, for as little as £1 a metre. Virgin Media said today 100,000 more homes in the Southampton area would have access to its fibre/coax network by the end of the year.

Asked if Virgin Media had asked BT for access to its Westminster ducts, the spokesman said “BT will not let us use their ducts anywhere unless PIA (physical infrastructure access) obligations force them to – and even here you know well the differences in opinion as to how much this should cost.”

Virgin Media, Fujitsu Telecom and others complained earlier to Ofcom that BT’s proposed prices for PIA were at least five times higher than cost, and called for BT to drop its prices.  It is believed BT has submitted a revised price list, but Ofcom has not confirmed it.

The spokesman said that Westminster council was reluctant to allow it to dig up the roads so that Virgin Media could lay its own cable to duplicate the BT network. The area is only just getting back to normal after disruptions caused by three years of roadworks.

Virgin Media last week it was considering going go ahead with a free London Wi-fi network.


Written by Br0kenTeleph0n3

2011/08/08 at 16:03

Posted in Broadband, Internet, News

Tagged with , ,

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