Out-Law News 2 min. read
15 May 2015, 4:05 pm
The measure would allow BT's competitors to provide high-speed broadband services to businesses using the spare fibre-optic cables that BT has already installed alongside its own active network. Ofcom said it intends to impose restrictions on the price BT can charge other communications providers for access to its 'dark fibre'.
Dark fibre is a term used to describe the unused additional optical cables operators installed alongside their active network to allow for easier expansion of the capacity of their network in future.
Under Ofcom's plans, BT would have to facilitate rivals' access to its 'dark fibre' in all areas of the UK outside of central London and Hull. In Hull, KCom would be required to open up access to its dark fibre, according to the proposals.
Ofcom said the measures are necessary to promote competition in the business broadband market.
"Competing in the provision of wholesale leased lines requires substantial long-term investment in local access infrastructure of exchanges, underground ducts and fibre cables," Ofcom said in its business connectivity market review (342-page / 2.97MB PDF) consultation paper. "We consider that, absent regulation, business consumers have an effective choice of providers only in those geographic areas where multiple competing [communications providers] operate such infrastructure in close proximity to customer sites. Elsewhere there is an enduring competition bottleneck."
BT is under an existing regulatory duty to allow rival communications providers to piggy-back on its network to offer competing business broadband services. That duty will remain under these latest plans. Ofcom's proposals will mean that BT's rivals will have the additional option of taking control over the spare cables BT has already installed and use that unused network to deliver competing services.
Ofcom said the measure could spur innovation in the market.
"Increased innovation is likely to be a key benefit, because passive access would enable greater competitive differentiation and faster development, and could stimulate the emergence of new technical solutions," the regulator said.
BT, Virgin and KCom had earlier this year urged Ofcom not to force owners of telecoms infrastructure to provide access to their network to rivals as part of its business connectivity market review. They said imposing such a requirement would disincentivise future investment in telecoms infrastructure.
However, a spokesperson for Vodafone said at the time that it "would like Ofcom to review making available BT’s dark fibre capacity" because it is not currently being "used to ensure a fair and competitive market post the proposed consolidation underway in the UK".
Ofcom's proposals are open to consultation until 31 July. It said it expects to outline its final policy early next year. Any new measures that Ofcom decides to impose would take effect in April 2016, it said. If Ofcom takes forward its current proposals, telecoms operators' access to BT's dark fibre would be facilitated from April 2017.
Jonathan Oxley, Ofcom competition group director, said: “High-speed, fibre optic leased lines are invisible to most people. But they form a critical building block in the UK’s infrastructure that underpins people’s personal and working lives. Today’s proposals should help businesses across the UK who rely on high-speed data lines. We want to see more innovation, faster installations and more competition, by providing operators with the opportunity to deploy the technologies of their choice."