BT rivals to be given access to dark fiber

Matthew Howett/Ovum
22 Jun 2015
00:00

On May 15, 2015 Ofcom published its Business Connectivity Market Review – the review of the market through which it regulates leased lines. As a remedy in that market, Ofcom is proposing that BT give its competitors physical access to its fiber-optic cables, allowing them to take direct control of the connection – a so called “dark fiber” product.

This is subject to consultation until the end of July 2015 and robust opposition from BT is expected. Assuming that the timing remains on track, this form of access would become available in the UK from April 2017.

For a number of years there have been calls for Ofcom to mandate that BT offer a dark fiber product; with this consultation, those calls have been answered. The price for access and the conditions on which it is granted will now be subject to debate before Ofcom finalizes its position later this year.

As well as satisfying the demands of alternative fixed-line operators, today’s announcement is also set to partially reassure UK mobile operators worried about what will happen if BT successfully acquires EE later this year. Vodafone, for example, has been particularly vocal about the need for a dark fiber product to connect base stations and backhaul mobile traffic without fear of interference from BT. This is relevant because BT currently provides most of the UK mobile operators’ high-speed mobile backhaul links.

Reaction from others in the industry has been more mixed. One of BT’s most vocal critics has been TalkTalk, an alternative provider that welcomed Ofcom’s proposals, although it says it will review them to see if they will address perceived problems quickly enough. CityFibre, which has built a successful business model out of deploying dark fiber, is remaining more tight-lipped.

Although forcing BT to open up its network in this way could create more access opportunities and allow new entrants to offer a much larger network, it might make it harder for them to undercut existing players and differentiate themselves.

Elsewhere in Europe, dark fiber is fairly common. According to recent Ovum research, approximately half of the 28 EU member states already have a requirement in place, along with countries in Asia such as Japan, Singapore, and South Korea.

Matthew Howett is practice leader for regulation at Ovum. For more information, visit www.ovum.com/

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