Duct and Pole Access to the many millions of premises served by the Openreach local loop is once more in the spotlight as Ofcom publishes its latest set of detail on the next version of PIA.
PIA (Physical Infrastructure Access) has existed in some form since 2010 but has never been taken up in any appreciable scale and with Ofcom now setting its sights on the UK reaching full fibre coverage of over 50% across the UK reducing the cost for new operators to deploy networks is central to this goal. The lengthy consultation document has lots of information and includes some feedback from previous consultations.
"1.18 If a downstream BT division (e.g. BT Consumer) were to deploy its own broadband fibre network using BT’s ducts and poles, it would be required to use the PIA product, in the same way as any other telecoms provider. BT’s recent agreement to reform Openreach to become a legally separate company within BT Group will strengthen the independence of Openreach from downstream BT divisions. However, BT’s broadband fibre networks are currently deployed by Openreach, and so our focus is on ensuring Openreach does not have an unfair advantage over competing network builders.
2.3 Telecoms providers interested in deploying ultrafast broadband networks at scale have expressed concern over the high costs required to deploy new physical infrastructure (such as ducts and poles). We believe that an effective PIA remedy will reduce the absolute costs and time required for competing telecoms providers to build ultrafast networks at scale. This should encourage additional investment and new entry into the market which in turn will promote competition in the WLA and downstream markets.
2.4 The PIA remedy was originally introduced following our review of the WLA market in 2010.2 The remedy required BT to allow third parties to deploy broadband networks using its physical infrastructure located in the local access network. It was primarily intended to assist telecoms providers wishing to offer fibre to the cabinet (FTTC) services in advance of BT roll-out of superfast broadband infrastructure, particularly in rural locations that were eligible for public funding support. However, the interest from competing providers to BT for these public funds, under Broadband Delivery UK (BDUK), ultimately failed to materialise.
3.12 We are at an important juncture in the development of the networks that will serve the needs of the UK in the future. In particular, network competition would make the decisions about how to serve the needs of customers in the future contestable. Instead of being constrained by BT’s chosen strategy of incrementally upgrading its existing copper network, competing telecoms providers have the opportunity to build their own ultrafast networks, such as FTTP."Extracts from Ofcom PIA 2 consultation
The new proposals include a mixed use network, so that operators can also use the ducting to serve leased line connections at the same time as delivering to residential premises, and requirements on Openreach to ensure capacity on poles or ducts and things like duct blockages being cleared on a network 'ready for use' basis with the costs being spread equally across all users.
On interesting aspect is that Ofcom says 'Today’s measures are designed to spur investment in the next generation of ultrafast internet connections, and reduce the country’s historical reliance on Openreach – the network business within BT Group' and while this may be the case in terms of the cabling, it actually increases the reliance on a network topology that Openreach is looking after that is decades old and given the piecemeal way that towns and cities have developed over the decades the local loop is often a lot more complex than it needs to be. PIA 2 has the potential to allow Openreach to stagnate its current product set of VDSL2 products and rather focus on increasing its duct and pole teams and become the national guardian of the various pipes and poles without all the worries of running any active or optical hardware.
The big question now is when will the consultations end and providers be able to make full use of this next version of duct and pole access and which operators are looking to use this on a scale that will deliver many millions of full fibre connections in a few years.
We believe a very likely outcome if other operators do embrace the new sharing regime for full fibre is that areas with VDSL2 (likely to be G.fast too) and Virgin Media cable will be the first to benefit and the low population density of rural areas will mean they are left behind again, unless the continuing gainshare re-investment continues to deliver an even higher proportion of FTTP versus FTTC. The big money to be made is not in providing broadband, but selling access to subscription TV content.
The Government (who ever it is after the June General Election) will need to reconsider how the Universal Service Obligation will work and to date while BT Openreach has shown some interest, if they find their engineering teams are busy servicing a new full fibre roll-out and expanding capacity on urban ducts and poles they may be a lot less interested in delivering USO level broadband to the final million premises in the UK, irrespective of whether it has a minimum speed of 10 Mbps or 30 Mbps.