Five Ways Nationalizing BT Network Would Upend British Broadband
- Plan may strike nerve in a country where internet speeds lag
- Project could recharge debate over potential break-up of BT
The opposition Labour Party lobbed a grenade into British telecommunications with its pledge to re-nationalize BT Group Plc’s national fixed-line network and offer free broadband to everyone. While its chances of gaining power in the Dec. 12 election look slim, the proposal channels broader dissatisfaction with the country’s relatively slow internet services and may have an impact even if Labour doesn’t win.
Labour’s announcement on Thursday chilled dealmaking activity. TalkTalk Telecom Group Plc quickly paused the process of selling its fiber venture. Spain’s Telefonica SA, owner of the O2 mobile network, had been weighing a push into fixed-line broadband. Such plans are likely to be on hold until the election offers clarity on the industry’s future. The disruption could reverberate in the wireless sector too as BT Openreach -- the unit that Labour wants to return to state hands -- also manages the underground cables that link tens of thousands of mobile masts across the country. That means another big deal could be knocked off course: the potential sale by Vodafone Group Plc and O2 of their mobile tower joint venture Cornerstone.