Access to Bandwidth: Proposals for Action

1. Access to Bandwidth: Proposals for Action Ilsa Godlovitch Regulatory Policy Directorate igodlovitch@oftel.gov.uk

2. Access to Bandwidth • OFTEL Consultative Document (Dec 98) • “Access to bandwidth - Bringing higher bandwidth services to the consumer” • Focused on access to higher bandwidth using DSL technology over BT’s local loop

3. Key questions • Is there demand from residential consumers and SMEs that is not being met? • Are there barriers preventing operators and service providers from accessing these consumers? • If so, how can this be resolved? 5 options set out… not mutually exclusive

4. Results of consultation • Over 60 responses from a wide variety of bodies • Preliminary conclusions: • Residential sector has promise of future effective demand, but faces ‘chicken & egg’ situation at present • Unmet effective demand in the SME sector and from SPs and operators • SPs and operators face barriers to providing services

5. Options for action • Customers need access to services, not access options • Service Providers prefer wide accessibility as delivered by Option 4 • Operators preferred more control over service delivery and timing, as in Option 2 • Options 1, 3 and 5 received less support, though Option 5 is long term goal

6. Option 2: Partial Baseband Leased Circuit Layer 1 Analogue Access NTP Customer Site BT Local Concentrator Building OLO providedequipment OLO collocated equipment MDF NTP/POI BT Partial Baseband Leased Circuit

7. Option 2 - pros and cons • Pros • Competing choices of higher bandwidth access and more innovation in services • Each operator can take its own risk and investment decisions independently of BT • Cons • Unlikely to deliver to the ‘mass market’ • Technical and operational issues • Provision of telephony

8. Option 4: Permanent Virtual Circuit Access Layer 3 Access ATM switch or IP router providing Permanent Virtual Circuit connection to OLO or SP NTP BT Local Concentrator ATM or IP OLO or SP DSL modem DSLAM NTP/POI DSL Access Multiplexer

9. Option 4 - pros • Substantial proportion of UK could be covered quite quickly • Thus attractive to many Service Providers • Minimises technical and operational problems • Customers can retain BT as telephone supplier

10. Option 4 - cons • If pace and extent left to BT: • Some effective demand my remain unmet for some time • No competition in the network upgrade • Choice of technology in the hands of BT • If OFTEL to determine extent of roll-out • OFTEL would have to substitute its assessment of economic viability for BT’s • Highly unattractive

11. OFTEL’s conclusions on consultative responses • The pros and cons of Options 2 and 4 tend to balance each other • Need to get the best of both • Stimulate competition in both Service Providers and Operator markets • Differing needs of residential and SME could be met

12. Next steps • BT has announced service provider products for ADSL (similar to option 4) • BT liaising with OFTEL’s compliance directorate • Awaiting consultation responses on unbundling proposals • And progressing work on Option 2

13. Consultation • How many will take up option 2 • What is likely utilisation and where are likely target areas • Pricing proposals • Views on local loop pricing principles • Co-location pricing • View on providing telephony • Feasibility of splitting the loop

14. Option 2 work plan • The NICC DSL TG has been asked to continue work to produce: • Spectral Management Plan to support Option 2 • Deployment rules to minimise interference • Focus Group of OPF LLU FG has been established to develop guidelines for the provision of: • Co-location facilities • Operational processes for loops

15. Key milestones • By Oct 99 - Groups scope tasks and terms of reference • By June 2000 - OPF LLU FG and NICC DSL TG complete work and publish conclusions • By Jan 2001 - Collect orders and set up trial • Service starts by 1st July 2001

16. Your participation • Welcome participation in industry groups to help resolve technical & operational issues • Responses to the consultation invited by 30 Sept. Statement to be published end of Oct.