Angry rivals demand BT action

PHONE company chiefs are demanding immediate action by the regulator to stop BT from introducing controversial new tariffs.

BT abandoned its standard rate last week and slashed call charges on all its major packages as part of a fightback against dozens of new operators that are starting to erode its dominant market position.

But the company also put up its monthly line rental charge, provoking fury at rival operators such as Tesco, Energis and Centrica. Their customers pay BT for the line rental, but not calls, so the new tariffs make BT's competitors less attractive.

Ian El-Mokadem, chief executive of Centrica's phone business, said he was making a formal complaint to Ofcom chief executive Stephen Carter asking him to use the Competition Act to freeze the BT changes.

'I want action fast,' he said. 'This is Ofcom's first big test and it must not fail.'

Carter has the power to stop BT changing its tariffs because the phone giant has such a large share of the market and is the only network linked to every phone-using household.

BT said: 'This is good for our customers and fair to the industry. We will continue to consult with the regulator and the industry.'

BT sources claimed that Ofcom was fully aware of what had been planned after a meeting in mid-February.

But Ofcom denied knowing about the change until BT made a public announcement last week.