Telecommunications Apparatus (Hansard, 23 December 1982)

§ Mr. Butcher

The Government's programme for the liberalisation of the United Kingdom telecommunications market is intended to cover all forms of subscriber's apparatus. A group of standards that together will cover all this apparatus is being written by the British Standards Institution; the first six standards have already been published. Work is well advanced on the standard for call routeing apparatus. Once this standard has been completed and approved by the Secretary of State, suppliers of call routeing apparatus will be able to apply to the independent British approvals board for telecommunications for approval to connect to the public network equipment which complies with the standard. The target date for completion of the standard for call routeing apparatus is July 1983; this will mark full liberalisation of this important category of subscriber's apparatus. However, from the beginning of the three-year liberalisation programme, which is due to be completed in mid-1983 the Government have acted consistently in the belief that it is in the best interests of British industry and telecommunications users to provide as many opportunities for competition as possible before the introduction of full liberalisation under formal British standards.

In consultation with industry and British Telecom, the Department of Industry has therefore pursued a programme of "pre-liberalisation" which has over the past year brought on to the free market over 50 products which swould otherwise not have been available at all, or would have been available only from BT. On 23 November I announced the latest tranche of these arrangements which allowed for the approval for private supply of a number of items of small call routeing apparatus and small automatic call distribution apparatus. Applications for approval are now being received. The Department of Industry, following further discussion with BT, is able to announce that BT has agreed the principle, which is welcomed, that suppliers supplying BT with subscriber's apparatus should be free to compete directly in the market place. Because of existing contractual arrangements between BT and its suppliers, and in some cases with third party interests, any proposal for supply to the market by a supplier w ill be a matter for commercial negotiation between BT and the companies concerned. Companies with contracts with BT 631W for the supply of an item of subscriber's apparatus will be welcome to approach BT with such a proposal. The commercial negotiations will take account of intellectual property rights and BT will be free to renegotiate existing contracts if companies wish to take advantage of the new arrangements. If the negotiations are successful, and provided that the subscriber's apparatus is technically similar to that already being supplied by BT, then there should be no obstruction to it being speedily approved for competitive supply. However, before approval is given, the Department will need to be satisfied that there will be an overall advantage to the United Kingdom economy and, in the case of call routeing apparatus, that satisfactory maintenance arrangements exist. These arrangements must be consistent with the Government's policy that only BT may maintain call routeing apparatus unless such apparatus is stored programme controlled digital call routeing apparatus installed after the general liberalisation of PABXs. In the latter case, the apparatus may be maintained by an approved maintenance contractor. Formal arrangements for the registration of maintenance contractors as a pre-condition of their approval by the Secretary of State are being developed by the British Standards Institution as a matter of urgency.

This new initiative will introduce greater competition in existing market segments, expand the avenues of supply, increase consumer choice and provide suppliers with an early opportunity to establish positions in the open market.

The arrangements for the installation and bringing into service of apparatus as well as its maintenance will be in line with the Government's overall policy and in due course I shall be placing in the Libraries of both Houses a more detailed statement of these arrangements.