As the Telegraph reports this morning:

BT has rescued TalkTalk from administration in a £400m deal that raises competition concerns.

The FTSE 100 telecoms giant has announced a deal to take over the struggling broadband provider, which had been on the verge of collapse.

TalkTalk, which reported revenues of £1.2bn last year, serves 2.5 million customers.

Why is this relevant? There are several good reasons for noting it.

Firstly, competition in this sector is failing. A company with a significant turnover and a large customer base cannot survive. There is good reason for that. The supply of internet services in a country like the UK represents a natural monopoly because the duplication of the cabling required to get internet into most houses in this country cannot be achieved affordably, and so any veneer of competition is virtually meaningless.

Secondly, questions about the failure of competition do naturally arise as a result.

Thirdly, the old BT monopoly is reappearing.

Fourthly, as a matter of fact, current regulation is inappropriate. I recently renewed a contract with BT, and although they reduced my price to encourage me to sign again, the contract included what are likely to be above-average inflation price increases throughout its duration, and this is exploitative.

So my necessary response to what is happening is that something as critical to our national infrastructure as the supply of internet services should be under state control. To have it otherwise makes no sense at all. Thatcher got the privatisation of BT  wrong.

The only question is, when will this be admitted, and when will regulation appropriate to the circumstances, which makes it apparent that there is no real competition and no room for exploitation, going to be introduced to lay the groundwork for renationalisation?

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