BT and Ofcom are understood to be under pressure to resolve their dispute over the future infrastructure subsidiary Openreach.
Ofcom recently ordered BT to legally separate from Openreach, so it is run as a distinct and legally separate company with its own board.
The watchdog believes this is necessary as BT has not done enough to ease its concerns over competition, particularly its belief that BT has the "incentive and ability to favour its own retail business when making strategic decisions about new network investments by Openreach".
Ofcom is now planning to push its case for a reformed Openreach to the European Commission in the coming months.
However, the Telegraph understands that the government is becoming increasingly frustrated with the lack of agreement between Ofcom and BT regarding the issue.
Sources close to the discussions told the newspaper that ministers want the watchdog to be consider compromising with BT in order to prevent protracted legal wrangling.
The insiders said the government is concerned that vital improvements to broadband could otherwise be delayed.
Speaking to the Telegraph, a spokesman for Ofcom said: "We're determined to bring about a more independent Openreach that serves the telecoms industry and all its customers equally."
As part of an effort to boost its transparency and autonomy, Openreach has recently appoint four independent directors to its newly-established board.
According to the organisation, the number of independent directors is higher than the number of executive board members.