Equivalence in UKs access network

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Equivalence in UKs access network

• Bob Cowie Chief Engineer

2
Openreach

• Openreach is a business within BT Group which
  launched on 11th January 2006
• It provides services to the whole UK
  communications industry to enable them to deliver
  communications to the 60 million people living
  and working in the UK
• It is responsible for ensuring equal access to
  the services and assets associated with the local
  loop

3
Ofcoms Strategic Review of Telecommunications

• Telecom Strategic Review launched at start of
  2004
• Competition restricted in wholesale markets for
  access and backhaul services and in directly
  related retail markets
• BT had substantial wholesale market power
• was a vertically integrated provider with a
  presence in the directly-related retail markets
• this combination potentially gave BT both the
  ability the incentive to discriminate
• Ofcom proposed a solution based on Equality of
  Access

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The remedy Equality of Access

• Undertakings agreed with the regulator (Ofcom)
• Openreach created as a new line of business
  within BT Group
• Objective to deliver equivalence of input and
  transparency
• Equality of Access Board (EAB) set up
• Internal Code of Practice used by all BT people
• Breaches can lead to
• Directions from Ofcom and/or court enforcement
• Reference to the Competition Commission
• Potential third party actions for damages

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Common capabilities underpinning the UK
telecommunications industry

• The Openreach SMP products are components in end
  to end solutions and products for communications
  providers and downstream BT Lines of Business
• Equivalence of input across
• Network
• Systems
• Processes and organisation
• Efficient design will drive economies of scope
  and scale

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Openreach products

• Openreachs product set is comprised
• of four major products
• Wholesale Line Rental PSTN, ISDN2 and ISDN30
• Local Loop Unbundling full and shared
• Backhaul Extension Services (BES)
• Wholesale Extension Services (WES)

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How does Openreach operate?
End Users (EU)
Communications Providers (CPs)
Other network operators
Openreach
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Market Structure - Technology regulation
driving convergence
Entertainment
Sky
AOL
EasyNet
Wanadoo
BT Retail
Broadband
Tiscali
Pipex
BT Wholesale
Bulldog
Cable Cos
CW
Centrica
Carphone Warehouse
Energis
Brand Extenders
Thus
Voice
Openreach
Tesco Virgin
High
Low
Network Infrastructure Capability
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Openreach lines logistics

• Openreach has responsibility for the copper
  access network between the MDF the monopoly
  wiring
• Openreach field engineers support UK
  communication providers

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The access network some numbers

• People 30,000
• 14 million jobs a year
• 2 million km optical fibre
• 120 million km copper access
• 30 million customer lines
• 7 million broadband connections over our network
• 8 billion assets, 4 billion projected revenues

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Our network has its challenges

• Some network more than 70 years old
• Legacy systems that do not align with new
  Openreach model
• Historical investment has been targeted at POTS
• Excellent people need re-skilled for new
  technologies
• Challenge to improve our network and improve its
  higher bandwidth capability

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Bandwidth landscape 0 to 65Mbps downstream
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Take-up of LLU

• Nationally there are
• 17 LLU operators
• 816 unbundled exchanges at 14th April 2006
• 420 of these have more than one operator present
• Overall at 14th April 2006 there were 365,402
  unbundled lines

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Summary

• SMP position of BT in access network market was
  recognised
• Openreach formed to deliver underpinning
  infrastructure and EOI for all
• E.g. Carphone Warehouse, Easynet, Bulldog, BT
  Retail Wholesale all have equal access
• Stimulation of competition in higher layer
  network services
• Openreach is only successful if the industry is
  successful
• Provide underpinning broadband infrastructure for
  the UK economy
• Broadband availability amongst the highest in the
  G8
• Aim to underpin higher value applications and
  services which exploit broadband