04, OCT '93
16:16 DII-TPIH
DTI-TPLA
F.4
COMMERCIAL. IN-CONFIDENCE
vi) Hans Snook said that they had general concerns on BT's pricing and what they might or might not do in the future to react to competition. You said that we clearly anticipated a continuation of the re-balancing of prices but this was a lengthy process. Hans Snook referred to a specific "problem" with Hutchison's paging operation where BT charged them a rate ("B"
("B" rate) which meant that Hutchison pagers were more expensive to call than any other pager. I said that I had discussed this at length with their regulatory manager and I understood that it was a commercial rather than a regulatory matter. You offered to investigate further whether there could be any possible role for us and/or oftel on this issue.
vii) Hans Snook said that current tariff offerings were squeezing service providers out of the market as their ability to make a profit was diminishing. He wondered whether there was any temporary assistance which they could be given. I said that our licensing policy recognised a place in the market for service providers and in particular sought to protect "non-tied" service providers from receiving any less favourable terms to "tied"
"tied" service providers. You said that the market place may well change with the introduction of two new operators but this would be a result of competition.
viii) Hans Snook said that Hutchison's telepoint operation was now under review and Canning Fok confirmed that this was losing money to the extent that closure was a definite option. I confirmed that I had met with the Telepoint management last week and further discussions were to take place. We talked generally about the Telepoint concept and whether there was a place for it in the UK market and also their knowledge of BT's interest in the spectrum. I said that the UK were keen to see CT2 technology continue and also that at this stage only mobile use was exempted in the spectrum. If Hutchison were to close Telepoint we would no doubt have to consider the spectrum implications. Hans Snook said he had previously asked Mr McLoughlin whether the Government could require all cordless phones to be digital. We did not respond directly. He also said BT had decided that there was no business case to participate in Hutchison's Telepoint operation. Canning Fok concluded that although no decision had yet been taken to pull out of CT2, the future of this service would be studied closely in the next few weeks.
WBeen.
LESLEY BEECH (Miss)
Telecommunications and Posts Division
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