(Image Credit: iStockPhoto/Ramberg)
In 2012, Ofcom reviewed business connectivity and decided against allowing rival internet service providers to use BT’s dark fibre network. The regulator has now reversed that position and is proposing that other ISPs should be permitted to access the unlit fibre-optic infrastructure.
Dark fibre refers to unused fibre-optic cables laid in the ground to provide spare capacity for future demand. During the earlier review, Ofcom argued that opening dark fibre to competitors could “carry significant risks of worse outcomes, both for consumers and for effective competition, including adding costs and encouraging inefficient entry.”
That stance is now changing. Allowing rivals access to dark fibre would let them install and run their own electronic equipment on those fibres rather than relying on BT’s network equipment. Proponents say this could spur innovation, speed up installations and increase competition by giving operators the freedom to deploy the technology of their choice.
Mobile and alternative operators such as Vodafone are likely to welcome the proposal. They have previously raised concerns that BT’s combined fixed-line and mobile assets would create an unfair advantage when BT completes its acquisition of EE, since control of extensive fixed infrastructure can lower the cost of providing mobile backhaul and related services.
Jonathan Oxley, Ofcom’s Competition Group Director, commented: “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.”
Not everyone supports the change. In March, a letter to Ofcom signed by BT, Virgin Media and KC warned that opening access to dark fibre could lead to higher prices and “significant regulatory uncertainty, undermining the return on sunk investments and therefore disincentivising future infrastructure investments.” The letter also cautioned that allowing multiple operators to work directly on the same physical network could increase the risk of service faults for customers.
In addition to the dark fibre proposal, Ofcom has suggested other significant measures. One would impose a new “Quality of Service” performance requirement on BT Openreach to encourage faster deployment of high-speed Ethernet services. At the same time, Ofcom proposes removing obligations on BT for very low-speed lines (below 2Mbps).
Ofcom’s Dark Fibre Statement:
Ofcom is proposing that BT should give competitors physical access to its fibre-optic cables, allowing competing operators to take direct control of the connection. This service is often referred to as dark fibre, because the fibre-optic cables would not be ‘lit’ using BT’s electronic equipment. Instead, they would be ‘lit’ by the competitor installing its own equipment at either end of the cable.
BT is already required to offer wholesale leased line products, which bundle the fibre-optic cable and BT’s own network equipment, at regulated prices to competitors. BT would still be required to provide these services, but the new proposal would go further, allowing operators to use BT’s fibre-optic cables with their own equipment, rather than rely on BT’s.
This should increase the opportunity for competitors to create tailored, high-capacity data links at cost-effective prices for their customers.
The proposal will now enter a public consultation period running until 31 July 2015. Ofcom expects to reach a final decision in the first quarter of 2016, with new rules introduced from April of that year. Actual access to dark fibre for rivals would follow later, with availability delayed by the need to agree pricing arrangements.
What do you think about Ofcom’s latest proposals? Let us know in the comments.