Virgin Media boss is baffled by broadband windfall, saying it conflicts with Ofcom plans

 
Oliver Gill
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Virgin Media is owned by Liberty Global and serves 27m customers across 14 countries (Source: Getty)

Virgin Media has hit back at news of a £440m broadband boost to the remote parts of Britain.

The government announced today more money would be ploughed back into the country's telecoms infrastructure as a result of better than expected demand for superfast broadband in the hard to reach areas.

The money is a rebate from BT, which was paid to improve the coverage of the remote parts of the nation's network.

Read more: Rural broadband surprise provides £440m bonus

But Virgin Media, which runs its own fibre broadband infrastructure in the UK, said the news showed the current operating structure wasn't working.

"This is proof government broadband policy is a muddle," said Virgin Media chief exec Tom Mockridge.

The majority of the UK's telecoms network is operated and maintained by BT through its subsidiary Openreach.

Broadband competitors such as Sky and TalkTalk have previously called for Openreach to be spun-off from the BT group because, like them, BT also delivers broadband services to customers' homes. The telecoms giant is therefore both the parent and the customer of Openreach.

Read more: Not acceptable: Ofcom assessment as 1.4m homes go without decent broadband

And last month, telecoms regulator Ofcom revealed plans to legally separate Openreach from BT.

Nevertheless, Virgin Media felt the rebates were at odds with this policy.

“On the one hand, Ofcom tries splitting what it says is a BT monopoly. On the other, government cuts public services and gives subsidies to BT," said Mockridge.

Nevertheless, culture secretary Karen Bradley hailed the reinvestment news.

“Broadband speeds aren’t boosted automatically – it needs people to sign up. Increasing take-up is a win-win-win: consumers get a better service, it encourages providers to invest, and when more people sign up in BDUK areas, money is clawed back to pay for more connections,” she said.

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