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Author Topic: Ofcom CEO says Openreach needs to be more ambitious  (Read 442 times)

Ignitionnet

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Ofcom CEO says Openreach needs to be more ambitious
« on: February 14, 2018, 03:57:24 PM »

From Think Broadband, based on an article in the Daily Heil.

Quote
The pressure on Openreach to be seen to be doing a lot more in terms of full fibre roll-outs is growing, unfortunately for the operator the pressure does not come with any extra money and this increasing pressure on Openreach carries a massive risk that it may discourage more of the investment that others such as CityFibre, TalkTalk, Vodafone, Hyperoptic, Gigaclear are making in their own full fibre roll-outs and not forgetting the expansion by Virgin Media.
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Ignitionnet

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Re: Ofcom CEO says Openreach needs to be more ambitious
« Reply #1 on: February 14, 2018, 04:00:22 PM »

Now that's done here are my thoughts on the comparison between the UK and Spain / Portugal, copy/pasted from my entry to an Ofcom / ODI open Collaboration document.

TL;DR Ofcom need to stop politicking and get on with factual, data-driven regulation or make way for a body that will.

Quote
I note the following articles:

http://www.thisismoney.co.uk/money/news/article-5389129/Telecoms-watchdog-accuses-BT-complacency.html
https://www.thinkbroadband.com/news/7949-ofcom-ceo-says-openreach-needs-to-be-more-ambitious

This quote specifically:

‘Why should we be any different from Spain or Portugal? Openreach have made a good start but I would like them to set a much more ambitious target.’

As Ms White and Ofcom would, I hope, be aware Spain and Portugal cannot be compared to the UK in this regard for three major, evidence-based reasons:

1) Ofcom have always required Openreach to wholesale all fibre-based products to other providers on the same basis as to their own Wholesale arm, and in turn have required BT Wholesale to provide products to other providers on the same basis as their own unit BT Retail. They have shown no inclination to change this.

The Spanish incumbent, Telefonica, had no requirement to wholesale FTTP / fibre to the premises at superfast speeds put into law until 2016, taking effect 18 months later, and even then retain no requirement to wholesale their FTTP network at all in places where there are at least 3 competing networks offering FTTP/B or cable services.

The Portuguese incumbent, Portugal Telecom, had no wholesale FTTP offering until 2017.
This permitted both to build networks and enjoy full vertical integration - being guaranteed all revenue from the networks rather than only being assured incremental wholesale revenues.

2) Both Portugal and Spain have a significantly higher proportion of their properties within MDUs, multi-dwelling units, than the UK. Analysys Mason research from 2016 placed the respective proportions at 40% for Portugal, 68% for Spain, 12% for the UK.

It is considerably cheaper to deploy to these. Hyperoptic are a fibre-based provider delivering services almost universally and place their costs at around £170 per premises passed. Compare this to Virgin Media, budgeting some £667 per premises passed to build their network, largely to single-dwelling units, or Openreach’s own estimates of £300-£600 per premises passed even taking advantage of their pre-existing infrastructure.

3) Portugal Telecom intend to completely close off their copper network by 2020, saving large amounts on maintenance, power and building costs. Telefonica began closing down their copper network in 2015. I would point out that Openreach cancelled plans just to run a small selection of cabinets with Fibre to the Cabinet only due to complaints from LLU operators - if Ofcom would permit Openreach to shut down their copper networks where they deploy FTTP they need to actually get these plans into operation right now.

I hope these three reasons answer why we aren’t a Spain or a Portugal - two of them are entirely due to regulation, and would be things I assume Ofcom would be quite aware of. Between them they make the comparison entirely invalid.

Are Openreach not being ambitious enough? Maybe. Using Spain and Portugal’s status is, however, not a valid comparison.
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Bowdon

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Re: Ofcom CEO says Openreach needs to be more ambitious
« Reply #2 on: February 14, 2018, 05:10:41 PM »

I was thinking as I was reading the article, I wish some of the knowledgable types could get their points across in the official documents. It turns out you were ahead of my thinking :)

As a relative layman when it comes to the technical side of things, it as always puzzled me why BT/OR seem to have been so over regulated. It is like Ofcom haven't moved on from when BT were a nationalised company. I understand the regulation in the early days to make sure they were heading in the right direction. But there really needs to be a forward thinking plan especially about turning off copper. It's like the talking heads of the government bodies are stuck in the past.

On the other hand other companies seem to get hardly any regulation. If BT/OR were treated like the other companies we might be further along in to the future by now.
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burakkucat

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Re: Ofcom CEO says Openreach needs to be more ambitious
« Reply #3 on: February 14, 2018, 05:54:07 PM »

Once Europe is gone the Government can then "delete" Ofcom.  :-X
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kitz

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Re: Ofcom CEO says Openreach needs to be more ambitious
« Reply #4 on: February 14, 2018, 09:35:34 PM »

Now that's done here are my thoughts on the comparison between the UK and Spain / Portugal, copy/pasted from my entry to an Ofcom / ODI open Collaboration document.

TL;DR Ofcom need to stop politicking and get on with factual, data-driven regulation or make way for a body that will.

Excellent post and sums up why OFCOM is far more of a hindrance when it comes to the roll out of FTTP.
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