Issue: 04/09

WIK-Consult Focus Forum

February 18 , 2009

ATUG’s first Focus Forum for 2009 will be held in Sydney on the 5th of March.

This Forum is part of ATUG’s preparation for the next stage in the NBN process – developing the right regulatory framework.

The Forum is an opportunity for members to hear economic analyst and researcher, J. Scott Marcus, a senior consultant for WIK-Consult GmbH based in Germany, discuss the necessary regulatory conditions for competition in the Next Generation Access Network and provide an update on communications policy developments in the EU and US. Marcus is also in a position to comment on the apparent shift in thinking on telecoms regulation in the US since the change of administration.

To register for the event Click Here

ATUG will make a summary of the event available to all members for comment via the ATUG Blog.

Background

WIK-Consult prepared a report in 2008 for the European Competitive Telecommunications Association (ECTA) on "The Economics of Next Generation Access". Click Here

WIK also prepared reports used by the ACCC in assessing Mobile Networks costs - Click Here

The main objective of the ECTA study was an assessment of the viability of next generation access business models and an analysis of how regulation might support viable duplication of infrastructure whilst ensuring competition in the provision of services to consumers and businesses e.g., at page XV11

8.1 NGA investment requirements are very much dependent on national
specificities (e.g. low civil engineering costs in Portugal, renting ducts in the
distribution cable segment in Italy instead of own investment).

8.2 FTTC/VDSL requires much less investment than FTTH due to saving the
distribution cable segment by using the existing copper sub-loops and
saving the inhouse cabling.

8.3 FTTH requires roughly 5-times higher investments than VDSL. The more
future-proof and open network friendly P2P FTTH architecture requires less
than 10% additional investment than the PON architecture.

And at page XX11

In an FTTH NGA environment, the current degree of competition based on LLU can only be maintained if fibre SLU (in case of PON architecture) and/or fibre LLU (in case of P2P architecture) are available as access products together with appropriate backhaul. Fibre LLU and fibre SLU increase replicability significantly and enable viable competition in all clusters where a first mover rolls out the FTTH infrastructure. Replicability is not given in less populated clusters.

The study looks at a detailed model for six European countries (Germany, France, Italy, Portugal, Spain, Sweden). For all six countries WIK provides comprehensive empirical evidence on the viability of replication of VDSL/FTTC infrastructure as well as of the deployment of FTTB/H infrastructure. The report shows the impact of regulatory measures like duct and dark fibre access, fibre loop and sub-loop unbundling on the replicability of NGA roll-out and competition.

Marcus will address the findings of this study, research work on terminating access prices for fixed and mobile networks and provide an informal view on recent communications policy developments from Europe to the US.

ATUG sees this event as an opportunity for an informed discussion as Australia heads into the final decision phase of the NBN proposal process and beyond that into debate about the appropriate regulatory framework for Australia’s National Broadband Network and Digital Economy development.

More Background on J. Scott Marcus is at http://www.atug.com.au/Opinion/Op110209/SMBio.pdf