BT has been criticised by a group of MPs for significantly underinvesting in its infrastructure subsidiary Openreach.
In a highly critical report, the Culture, Media and Sport Committee said BT has exploited its position to make strategic decisions that favour its own priorities and interests.
Furthermore, it said capital investment in Openreach has been "broadly flat" since 2009 until this year, while the standard of service is poor.
The committee has therefore called on BT to step up investment in Openreach, as well as grant it more autonomy over spending decisions.
BT was warned that if it fails to offer the reforms and investment assurances necessary to satisfy its concerns, sector watchdog Ofcom should "move to enforce full separation of Openreach".
The report has been welcomed by TalkTalk, which has called for BT and Openreach to be separated for some time.
Dido Harding, Chief Executive of the firm, said: "BT's broken promises risk creating a two-tier digital Britain, with millions of homes and businesses being denied fast, reliable broadband.
"Britain needs an independent Openreach, free from the shackles of BT and able to invest in world-class technology for the whole country, not just parts of it.
"After years of suffering, customers deserve nothing less."
Committee member Ian Lucas added that Openreach has a monopoly on provision broadband services in many parts of the UK.
Speaking to BBC News, he said there is a "long queue" of people who want high-speed internet connections.
"It will be very familiar to those of us who remember the 1980s waiting for a phone line - it's a similar situation, weeks, sometimes months waiting for a fibre connection through Openreach and there is nowhere else to go," he observed.
TalkTalk has already combined with Sky and Vodafone to push the case for why and how Openreach should be reformed.
In an open letter to Ofcom Chief Executive Sharon White, they stated that Openreach should be established as a legally separate company.
This, they said, would be a necessary first step to "true independence" that will allow it to agree a contract with a customer, employ staff and own assets, just as any other UK company does.