BT faces mandate to provide dark fiber to competitive business providers

BT may soon have to provide dark fiber solutions to competitors that operate in its territory as the country's regulator Ofcom has proposed that the incumbent telco should provide physical access to its fiber cables.

By providing dark fiber solutions, BT, according to Ofcom, would be able to provide its competitors with more control over the connection they provide to their customers because customers install their own optical gear at either end of the wire.

While BT would still be required to provide wholesale leased line products, which bundle the fiber cable and BT's own network equipment, Ofcom's proposal would allow competitors to use BT's fiber optic cables with their own equipment, rather than rely on BT's. Ofcom said that competitors would then be able to create their own tailored services.

This proposal is just the first step. After a consultation period that will close on July 31, the regulator expects to publish its final decisions in the first quarter of 2016, which would then take effect in April 2016. In addition, Ofcom would require BT to publish a draft "reference offer" that would outline wholesale pricing and terms for access, by the middle of 2016.

Analysts say that this decision could potentially have an effect on serving not only large enterprises, but also mobile operators like Vodafone that have been looking for a dark fiber-based wireless backhaul solution.

"As well as satisfying the demands of large enterprise users, today's announcement is also set to partially reassure UK mobile operators should BT successfully acquire EE later this year," said Matthew Howett, practice leader of regulation at Ovum, in a research note. "Vodafone, for example, has been particularly vocal about the need for a dark fiber product to connect base stations and backhaul mobile traffic without fear of interference from BT. This is relevant since BT currently provides all UK mobile operators with high-speed mobile backhaul links."

Howett added that England is not the only country in Europe where regulators have mandated that incumbent telcos have to sell dark fiber solutions to their competitors.

"Elsewhere in Europe, a requirement for dark fiber is fairly common," Howett said. "According to recent Ovum research, around half of the 28 member states already have a requirement in place – along with countries in Asia such as Japan, Singapore and South Korea."

Ofcom's dark fiber proposal is part of the regulator's Business Connectivity Market Review. As part of this review, Ofcom is proposing new, minimum quality of service performance requirements on Openreach, the division of BT that installs and maintains connections to BT's network for competitors. The regulator says that Openreach often takes too long to install leased lines, and too often changes the date on which it promises to deliver services.

Over the past four years, Ofcom claims that the average time between a customer's order and the line being ready has increased from 40 to 46 working days. The first new quality of service rule would require Openreach to return this average to 40 working days by 2017.

For more:
- see the release

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