Oftel U-turn gives Ionica breathing space

NEWS UK telecoms regulator Oftel has proposed a change in policy towards fixed radio access telecoms services that could also mean a reversal of fortunes for Ionica The regulator is proposing to scrap a number of fixed radio access provider's rollout obligations in exchange for charging for the use of radio spectrum. A spokesperson for Oftel said: "It follows from the Wireless Telegraphy Act. Instead of using rollout to make sure people make full use of the spectrum they use we are considering charging for the spectrum." The shift means that Ionica will be spared from its licence obligation of having to roll out a service to 75 per cent of the UK by 2000. At present it has only installed infrastructure for the Midlands and East Anglia. It is also searching for more funding. An analyst at Ovum commented: "From Ionica's point of view, it may not make a lot of difference. It is still in deep trouble. If it doesn't manage to find a white knight, it could still go out of business, so Oftel's gesture would be academic." "It is bound to be of some small help, but its much more down to cash flow and customer churn. If they were getting customers, they would want to roll out as quickly as possible anyway," he added. Ionica itself is taking a realistic approach and not pinning too much on the proposals. It acknowledged that being let off the roll out obligation would give it some breathing space.