Supporting the UK’s super-fast broadband future
Over the past two years, UK consumers have started to enjoy the benefits of the next generation of broadband, with a number of companies starting to invest in infrastructure.
But there is a long way to go to deliver the networks of the future that the UK needs.
Ofcom believes that competition and investment in super-fast broadband can be delivered in both urban and rural areas.
Today’s statement is designed to provide a further spur to investment by confirming the regulatory framework for these services.
It covers two principle interventions:
1) Providing competing services over BT’s fibre lines
What is super-fast broadband?
Super-fast, fibre optic broadband has the potential to deliver speeds of 50 to 100Mb/s (megabits per second) and enhance new consumer services such as broadcast quality video services, High Definition and 3D TV and interactive online gaming.
BT has launched its super-fast broadband product and plans to cover 66% of the UK by 2015. Virgin Media has rolled out 50Mb/s to 49% of households and is due to launch its 100Mb/s service soon.
Other smaller companies are also investing in these products including IFNL and H2O.
Ofcom’s decisions will allow BT’s fibre lines to be opened up so that rival firms – such as Sky, TalkTalk and others- can provide their own services to consumers.
This is similar to the way that BT’s copper telephone network was opened to rival phone and broadband services.
While companies will be given control of the lines to provide super-fast broadband services to their own customers, BT will be able to set prices for these new wholesale products so that it can make a fair rate of return reflecting commercial risk.
These prices will be constrained by the highly competitive wider broadband market and will be subject to rules to prevent anti-competitive pricing.
2) Giving access to underground ducts and telegraph poles
BT will also have to offer other communications providers access to its underground ducts and overhead telegraph poles.
This move will enable providers to build their own fibre networks more cost effectively.
It will allow competitors to roll-out super-fast broadband to areas where BT does not plan to deploy its fibre network and to target specific areas earlier than BT’s roll-out.
These measures build upon competition in the UK’s current generation of broadband services which reached a significant milestone last month when the number of unbundled lines passed the 7 million mark.
This has enabled rival communications providers such as Sky and TalkTalk to offer services over BT’s copper telephone network, delivering choice and competition for UK consumers.
Ofcom will continue to require BT to provide local loop unbundled services (LLU) to competitors, building on this success to date
Competition and Investment
Ofcom’s decisions are designed to benefit all UK consumers by recognising that different areas require different solutions.
That’s why we introduced a Voluntary Code of Practice on Broadband Speeds, which we further strengthened this year.
Internet providers who sign up to the Code commit to give consumers a more accurate and consistent estimate of the maximum speed likely to be achievable on their line.
At the same time, Ofcom’s research has also provided the most comprehensive picture of UK broadband speeds.
We achieve this by carrying out millions of separate service performance tests in thousands of homes.
The research is continuing and Ofcom is planning to publish a report every six months.
In areas where BT invests in fibre, the remedies will enable other providers to offer competing services, based on BT’s facilities.
Elsewhere, access to BT’s ducts and poles should encourage investment by other providers, enabling the provision of super-fast services and increasing competition.
The decisions are consistent with the Government’s potential role in encouraging super-fast broadband roll-out.
For example, duct and pole access could extend the reach of services to more remote areas, potentially in combination with public funding at a UK or EU level. Duct and pole access could also complement Government measures to encourage fibre roll-out by sharing telecoms and other infrastructure.
Ofcom’s Chief Executive, Ed Richards said: ‘The development of the UK’s super-fast broadband future is well underway with the roll-out of services in large parts of the country.
‘Today Ofcom has finalised a clear regulatory framework to promote investment, competition and innovation to enable as many consumers as possible to benefit from these exciting new services.
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