Ofcom has called for more flexible regulation for Openreach, claiming this will help drive investment in full fibre broadband from multiple parties and allow for the switch off of the UK’s copper network.
The UK regulator claims its current strategy of driving competition in the full fibre market has borne fruit, with full fibre coverage rising significantly over the past few years.
So far, Openreach has connected 1.8 million properties to the network – half of which were added over the past year – and is targeting 15 million by the mid-2020s. Meanwhile, Virgin Media, TalkTalk and CityFibre are also building networks, while Hull-based KCOM has delivered full fibre to the city.
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UK full fibre rollout
Ofcom believes its new proposals will “supercharge” this rollout, satisfying government demands for an acceleration and acquiescing to the industry’s calls for more favourable regulation.
“These plans will help fuel a full-fibre future for the whole country,” claimed Jonathan Oxley, Ofcom Interim Chief Executive. “We’re removing the remaining roadblocks to investment and supporting competition, so companies can build the networks that will drive the UK into the digital fast lane.
“Full-fibre broadband is much faster and more reliable. It’s vital that people and businesses everywhere – whether in rural areas, smaller towns or cities – can enjoy these benefits. So we’re making sure companies have the right incentives to accelerate full fibre to every part of the UK.”
Rather than using a ‘one size fits all approach’ across the entirety of the UK, different regulations would apply to different parts of the country depending on the level of competition and commercial potential.
In urban areas, Ofcom would look to promote competition by setting wholesale prices that would stimulate investment by both Openreach and from other players. This would provide a choice for providers and mobile networks, whilst also improving broadband and mobile networks.
However in rural areas where there is no prospect of multiple networks being built, the focus would be on improving the business case for Openreach. The government has already pledged £5 billion in public funding to assist with this.
Ofcom would also block Openreach from offering discounts that undercut rivals, while there would also be safeguards to ensure that consumer broadband services remain affordable.
Copper switch off
Finally, the regulator will help Openreach retire the UK’s copper network, recognising the cost burden of operating two networks. In areas where full fibre is available, Ofcom would deregulate copper and assist Openreach with migrating customers to fibre.
A 2033 switch off date had been touted but the government wants to bring this forward and a gradual regional switch off, similar to the changeover from analogue to digital terrestrial television, has also been suggested.
“Today’s proposals appear to be a big step in the right direction to give clarity and investment certainty,” said an Openreach spokesperson. “Like the Government and Ofcom, we want to upgrade the UK to faster, more reliable full fibre broadband.
“We’ll consider the range of proposals carefully and will continue to work with Ofcom and industry on getting the conditions right to help achieve the Government’s ambition of rolling out gigabit capable broadband across the UK as soon as possible.”
“The regulator’s proposals to support investment in full fibre, including plans to help improve connectivity in rural areas, are encouraging and should bring us closer to ensuring that no one is left behind by poor access to online services,” added Natalie Hitchins, Which? Head of Home Products and Services.
“But for people to truly benefit from these plans and investments, Ofcom, government and industry must work together, learning lessons from the slow take-up of superfast broadband, to ensure that consumers understand the benefits of these new, more reliable connections and are encouraged to take them up.”
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