Why BT Group plc (ADR) (BT) Is Not Happy With Verizon Communications Inc. (VZ) and AT&T Inc. (T)?

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BT Group plc (ADR) (NYSE:BT) expressed its unhappiness over Verizon Communications Inc. (NYSE:VZ) and AT&T Inc. (NYSE:T) abusing their monopolistic positions in landline to hurt their rivals. Therefore, the company’s President for America’s operations, Bas Burger, sought tough rules. Burger wants rules that will force the biggest telecom carriers to enable their competitor’s access to their networks at a reasonable rate. For this, he said that the company can pay regulated prices.

Hefty Fees To Carry Some Data

BT Group plc (ADR) (NYSE:BT) said that its capacity to take on the rivals were restricted since the company has to pay lofty fees to use the networks of rivals for carrying some data traffic. That included Verizon Communications Inc. (NYSE:VZ), as well as, AT&T Inc. (NYSE:T). Both the American firms have approximately 80% of the ‘special access network’. The special access network runs the telephone, as well as, broadband lines into to homes and offices and charges their rivals to use them.

The British telecom firm’s American Operations President, Burger, said that without any regulated contracts, and prices, the company is not able to compete with its rivals. On the other hand, the American firms provide networking services to the enterprises in the United States. Burger termed it as ‘the worst’ he has seen in the western country.

Not Enough Regulation

BT Group plc (ADR) (NYSE:BT) said that currently there is not enough regulation to create competition in the telecom sector. That is because all the access is offered by the top two service providers. He charged both the telecom service provides as dividing the country between them. Burger pointed out that in any other country, including the Great Britain, the dominant company is forced to provide their infrastructure at a regular price of their rivals.

Burger lamented the absence of such rules in the United States thus obstructing the quality of service it is providing. He wanted the Regulator to regulate both Verizon Communications Inc. (NYSE:VZ), as well as, AT&T Inc. (NYSE:T) to offer some standard of service. He pointed out that the company is not in a position to fix any fault within the specified time frame since the fault lies with the American firm’s side sometimes. Also, the two service providers are not obliged to rectify the faults.

It Loses Customers

BT Group plc (ADR) (NYSE:BT) said that it enjoys good networking services in other countries. However, it is not in the same position to provide similar kind of service in the US.

Both Verizon Communications Inc. (NYSE:VZ), as well as, AT&T Inc. (NYSE:T) are reportedly overcharging by $9 billion a year for use of the special access networks. The Federal Communications Commission has sought data last year from telecom firms on their special access networks.

Viraj Shah

Viraj Shah has completed M.Com (Finance) and is currently pursuing his CFP. He tracks US markets along with other global markets like India very closely. He is very passionate about stocks, real estate, and technology. He also believes that money can always be made in the market.

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