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Broadband surge protects BT from breakup

The recent surge in broadband take-up in the United Kingdom has saved BT from the threat of being forced to split its retail and network operations. U.K. telecom regulator Office of Telecommunications (Oftel) on Wednesday ruled out breaking up the company, saying it has enough powers to deal with anti-competitive behavior. "Because Oftel has sufficient regulatory powers to develop a competitive broadband market, the option of breaking up BT is therefore not on its current agenda. Competition in the broadband market continues to increase, with prices cheaper in the U.K. than in France or Germany," the regulator said.

Key to Oftel's decision is the boom in the number of people signing up for broadband, following the price cuts made by BT earlier this year. "The U.K. is on course for 750,000 broadband connections by the end of July," Oftel said. On May 1 the Culture Media and Sport Committee recommended that Oftel, or its successor Ofcom, should consider separating BT's network business from the rest of the company. Such a move, the select committee claimed, would increase competition in the U.K.' s broadband market.

ZDNet U.K.'s Graeme Wearden reported from London.

To read the full story, visit ZDNet U.K.