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Author Topic: Vodafone in talks with Openreach over big investment in ultrafast UK broadband  (Read 682 times)

gt94sss2

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Vodafone is in talks with BT’s network subsidiary Openreach about a groundbreaking joint investment in new ultrafast fibre-optic broadband for British cities.

The two companies are in what are described by industry sources as “early but serious” discussions about combining their financial strength to build large-scale new infrastructure to replace ageing copper telephone lines.

It is understood Vodafone plans to target the upgrades at major metropolitan areas initially, to allow it to provide faster and more reliable broadband to swathes of homes and businesses quickly.

More at the Telegraph at http://www.telegraph.co.uk/business/2017/08/22/vodafone-talks-openreach-big-investment-uk-broadband/
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Bowdon

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http://www.ispreview.co.uk/index.php/2017/08/vodafone-openreach-moot-joint-uk-fttp-ultrafast-broadband-investment.html

This could be a very interesting step. I like how the mobile companies are wanting to be involved with fixed line broadband/phone systems these days. Vodafone is big enough to bring a lot of money to the table.

I think there will be a lot of profit to be made by the network builders once the initial investment is spent.

This would be good news for the consumer! Lets hope the talks stay on track.
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kitz

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Sources said the regulations faced by Openreach were currently viewed as a potential hurdle to a joint investment with Vodafone.
Under rules set by Ofcom, the former state telecoms monopoly must sell access to its network on equal terms to all retailers including BT’s consumer arm. Vodafone is understood to be demanding a period of exclusivity over any new infrastructure, however, to allow it to build its position in the market.
 

So they will only invest if they get exclusive access for a period of time.  So obviously that would mean they want priority over all else including BT consumer and other BTw based SPs.

In way I why understand why Vodafone would want this, but OTOH the rules are rules and OFCOM has declared that any investment by Openreach into the infrastructure must give all SP's equal access. 
Will be interesting to see which way OFCOM lean on this.... and if Sky & TT will be happy for one of their emerging competitors to get access to a network mostly funded by Openreach before they can.   

If OFCOM do relax the rules could it also be viewed as a case of 'anyone except BT' because they sure would not have allowed it if the corporate BT had said, "we will invest more into FTTH if BT Wholesale has a period of exclusivity" despite the fact that BT Wholesale would mean that any SP could purchase via wholesale if they so wished.
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WWWombat

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Wow. That's a cat thrown amongst the pigeons.

OTOH the rules are rules
...
Will be interesting to see which way OFCOM lean on this

We know Ofcom want to get full-fibre by adding more competition ... and getting Vodafone into the fixed line physical infrastructure market must surely count as added competition from one of the obvious sources in the UK.

But Ofcom really envisaged this happening by someone coming in and renting via PIA. Not by hiring Openreach to do the work. However, I suspect Vodafone are big enough to make Ofcom at least pause for thought over their strategy.

I agree that it will be interesting to see which way Ofcom go. Really interesting.

In fact, the Vodafone approach could be perceived as better in the long term ... it is a network that starts out with exclusive use (just like someone renting PIA, or VM installing more physical cable), but eventually falls back to something regulated by VULA. It acts as stimulus to get new cables in the ground, but eventually allows little players into the game.

That looks to me like having your cake, and eating it for desert too. For Ofcom, anyway.

Really interesting.

(Edit: emphasise Vodafone's involvement in laying down physical infrastructure, rather than just in a nebulous "fixed line" market that could be WLR)


Aside on Vodafone's motivations...
I wonder if Vodafone might be more concerned about ensuring fibre backhaul for their masts, especially with 5G coming up. The period of exclusivity might be to ensure that their investment is not of benefit to the other mobile operators.
« Last Edit: August 23, 2017, 01:37:59 PM by WWWombat »
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WWWombat

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Also interesting to see that Sky might have an alternative approach under discussion too.
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Chrysalis

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NewtronStar

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That statement is not gonna make you very popular with rural and suburban Broadband users.
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kitz

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Aside on Vodafone's motivations...
I wonder if Vodafone might be more concerned about ensuring fibre backhaul for their masts, especially with 5G coming up. The period of exclusivity might be to ensure that their investment is not of benefit to the other mobile operators.

hmmm yes.  Very good point!
..  and since vodafone are the UK's largest mobile operator, this is something which could very well  put them in some sort of monopoly position.. I wonder how OFCOM will view that gem. ???
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