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BT plans Ј1.5bn fibre push

16 июля 2008

UK incumbent operator BT has finally said it will invest £1.5 billion in a next-generation access network, following similar initiatives announced in the last few years by operators in countries including France, Germany, Italy and the Netherlands.

The move comes amid growing pressure on the operator - which had originally said it intended to rely on ADSL2+ technology - to meet increasing demands for high-speed and high-capacity broadband: recent developments such as the BBC iPlayer have indicated that consumer bandwidth needs are growing exponentially in the UK.

At first glance BT's plans look ambitious: the network will reach 10 million homes by 2012 and have top speeds of up to 100 megabits per second.

In reality the network looks set to be primarily a fibre-to-the-cabinet (FTTC) network that will initially deliver broadband speeds of up to 40 Mbps: BT will build fibre to the premises (FTTP) in greenfield sites and FTTC in other areas. And the project will involve BT spending only £100 million above existing capital expenditure plans in each of the 2008/09 and 2009/10 financial years.

But whether the network is FTTC or FTTP, there's no doubt it will alter the state of play for alternative network operators that have invested in unbundling the local copper loop in BT's existing exchanges; For its part, BT hopes to gain some considerable benefits too.

BT says it is committed to making an "equivalent" wholesale offer on its new fibre network that takes into account BT's investment risk, meaning that competing operators will access the network under the same terms and conditions as BT.

But BT, which has no mobile arm, also wants equivalent wholesale access to work both ways and is pushing for other operators to open their networks - including mobile operators. "BT's firm belief is that all next-generation networks in the UK should be open," according to a company statement.

"We're referring to Virgin and mobile players as they move into a converged environment. The days of BT being an incumbent are long gone," said Emma Gilthorpe, group director, industry policy and regulation, at BT.

For now, if BT is hazy on details of exactly how, when and where the new network will be deployed, it is partly because there is still uncertainty about how the new access network will be regulated, as well as about what services residential customers will buy and at what price. Like other incumbent operators, BT wants to ensure that any wholesale prices reflect risk.

"We haven't got much detailed analysis on the right level of return. It's a risky investment ... and we want that to be recognised," said Gilthorpe.

It is still unknown whether BT's new network will have to abide by universal service obligations, or what wholesale services BT will have to offer. Certainly, "Openreach [BT's network access arm] is ... looking at an active line type product," said Gilthorpe, but Ofcom will have the final say. "Ofcom is looking at whether it will be sub-loop unbundling. We will encourage them to make decisions quickly," added Gilthorpe.

BT is keen to know whether or not there will be universal service obligation, and would like to be sure that it will be able to phase out the copper local loop network over time.

"One of the key priorities is to talk through the transition [from copper to fibre] with Ofcom," said Gilthorpe.

"We would envisage a time where we would remove the copper network ... we're not doing it right away but we want to know that it's possible," said Gilthorpe.

Although again this will depend on negotiations between Openreach's existing customers, which will want to secure a return on their investment in copper local loop unbundling, and Ofcom.

"We have a sizeable wholesale base that has invested in LLUs so [they need] ample time to refresh rollout plans," said Gilthorpe.

Ofcom, which welcomed BT's announcement, has said it is addressing the questions with urgency.

In the meantime, BT has written to local and regional authorities to ask them to define local demand profiles for very high speed broadband, so that it can build fast networks in those areas that are likely to stimulate demand, said Gilthorpe.

Источник: Total Telecom

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