| NOTAS: | "This report, which examines the efficiency of British Telecom (BT), has been prepared for OFTEL by National Economic Research Associates (NERA). This assessment of BT's efficiency will be a key input into setting of the X factors in the price cap formula used for any future retail and network price controls. The report compares the cost efficiency of BT with that overseas telecommunications operators. The comparisons are principally with the US Local Exchange Carriers (LECs). However, comparisons are also made with four European operators, using simple cost measures. US LECs were chosen as comparators since a significant amount of detailed cost data is available for these companies, and because the better-performing LECs are generally regarded as providing the international benchmark for efficiency. The study covers the years 1995 to 1998 and makes use of accounting and other data produced by BT, as well as extensive data for the US LECs published by the Federal Communications Commission (FCC). Our analysis excludes mobile networks, cable TV networks and value added service activities of either BT or any of the comparator companies. The focus of this study is purely on the core PSTN, access and leased line operations of the companies." |
