BT, a communications services companies, serves customers in the U.K. as well as more than 170 countries. BT (News - Alert) is hoping that by the end 2013, it will reach the end of its commercial rollout of “fiber-to-the cabinet” (FTTC) broadband. Its aim is to cover two-thirds of U.K. premises.
If things continue to move along as they have been, BT will finish the rollout two years sooner than it first predicted. In June of 2013, BT is planning on cutting the wholesale cost of what it calls its “ultra-fast” 330Mbits/s FTTC by over a third. This could be problematical because in May of 2013, Ofcom, an independent regulator and competition authority for the U.K. communications industries, should announce its proposals for regulation in the wholesale broadband access market.
Openreach, a division of BT, is responsible for delivery of the fiber broadband network. Openreach also delivers local loop services that comprise the copper, as well as fiber connections between telephone exchanges and consumer and business premises.
The expected proposals from Ofcom are in response to the fact that alternative networks who rent from Openreach are not sure how much they were paying for the wholesale input of the fiber service.
Matt Howett, an analyst for Ovum, a company that provides clients with independent and objective analysis, said, “At the moment Openreach is free to price the wholesale product as it sees fit, there is no regulated pricing and access seekers such as TalkTalk would like to see a regulated product because they believe that the price would come down.”
Ofcom has a difficult decision. It’s not certain that the price would go down if the product were regulated. Ofcom has to decide if it will let BT have a free hand or if broadband will be regulated. Howett said, “I suspect that it wants to keep BT onside and continue the rollout as planned.”
The UK is trying to compete with Japan and South Korea’s connectivity for businesses. To do this, it needs to be able to provide fiber to the home, the office and to anywhere that a connection can be made. BT is also trying new technologies to limit the amount of cross-talk in copper wires. This is similar to noise cancelling headphones. That would provide faster and cleaner connections.
Unfortunately, there are still critics who are not sure that it’s a good idea to fiber all of the U.K. The government needs to convince groups, such as the Country Land & Business Association (CLA). They claim that between 15 and 20 percent of people living in rural areas are still unable to receive anywhere near the government’s benchmark of a minimum of 2Mbit/s speed.
EE is a mobile provider and a joint venture between France Telecom and Deutsche Telekom (News - Alert). It has already launched 4G services in major U.K. cities. Although BT is considered a “fixed line” provider, it would like to bid on the 4G spectrum. Ofcom expects that the new spectrum will boost the amount of airwaves available to mobile phone by more than 75 percent. This will play a crucial role in meeting the growing demand for mobile data among consumers.
EE said it wants to provide service to 50 percent of the population with its services in 2013. Currently, it is renting broadband wholesale from Openreach. You can see how fixed and mobile options are all intertwined. Both are needed, both are important. Improvements, installations and upgrades to broadband and fiber are moving along strong in 2013.
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Edited by Rachel Ramsey