EU initiative to reduce the cost of deploying high-speed internet across Europe

Wolf-Dietrich Grussmann

DG CONNECT Unit B.1 (Regulatory Coordination & Business)

FTTH Conference, London, 19 February 2013

A bundle of EU initiatives to ensure investments in fast and ultra-fast Internet access

Increase regulatory certainty and consistency

across Europe

Stimulate demand for high bandwidths

Provide for sufficient spectrum

Facilitate financing

Lower deployment costs

Broadband deployment costs High Speed Broadband Deployment Costs (e.g. UK, based on Analysys Mason, 2008)

The largest single cost component is civil engineering - up to 80%. Up to 30% cost reduction could be achieved by the re-use of existing ducts, including those of alternative infrastructure owned by other utilities (e.g. water, energy, railways) Measures can be taken to make investment more efficient, less costly, all in a competition-enhancing way (Analysys Mason, 2008; Francisco Caio, 2008; WIK, 2008, etc.)

Cost saving potential

• Using existing passive infrastructure opposed to new construction 30-60%

• Co-deployment opposed to self-deployment 15-30%

• Equipping new buildings NGA-ready opposed to retro-fitting existing buildings 20-60%

• Source: Analysys Mason (2012)

Cost reduction measures are envisaged by several initiatives …

• The Digital Agenda for Europe called on Member States to “take measures to facilitate broadband investment, among others through making sure that civil engineering works systematically involve potential investors, clearing rights of way, mapping available passive infrastructure suitable for cabling and through upgrading in-building equipment”

• The Broadband Communication (COM(2010)472) indicated a number of regulatory measures that could be adopted at national and local level “to promote investment and reduce investment costs, such as reducing the civil engineering costs through a proper coordination by national and local authorities, using town planning rules and remedies mandating access to passive infrastructures”.

• The eCommerce Action Plan (COM(2011)942) called on Member States “to place investments in high speed internet at the core of their growth strategies, […] among others by adapting town planning law to limit deployment costs”.

…but the pressure to act is mounting

Conclusions of the European Council (1-2 March 2012): “15. In particular, efforts will continue in order to […] complete the Digital Single Market by 2015, in particular by adopting measures to boost confidence in on-line trade and by providing better broadband coverage, including by reducing the cost of high-speed broadband infrastructure” (under the EU Action heading) Single Market Act II (3 October 2012, COM(2012) 573): “Key action 9: Reduce the cost and increase efficiency in the deployment of high speed communication infrastructure” Legislative proposal to be presented in Q1/2013 and adopted by Spring 2014

Public consultation on an EU initiative

• Consultation published on the DG INFSO website and on Your Voice in Europe on 27 April 2012

• Deadline for submitting a contribution was 20 July 2012

• 101 Contributions from a wide variety of stakeholders received (beyond telecom and including also utility companies, manufactures, local authorities etc.)

Main results of the Public Consultation • Nearly all the respondents identified significant benefits for

NGA rollout from a more intensive and coherent EU infrastructure sharing regime, including utility companies.

• Due to technical and organisational challenges, benefits of co-deployment and coordination of civil works vary from case to case.

• Responses suggest a general consensus as to the need to equip new buildings NGA-ready.

• Industry responses clearly pointed to the need to simplify/streamline/reduce the costs of the permit granting process.

• Mapping was generally acknowledged as an enabler for access to existing passive infrastructure, though overall benefit depends on costs.

Mapping –examples & costs

Objectives of an EU Initiative

Making a better use of existing infrastructure, including across utilities

Enhancing transparency and coordination of civil engineering works

Handling requests to rollout networks in a more efficient and transparent way

Ensuring ready for NGA access buildings

1. Making a better use of existing infrastructure

• Increasing access to existing passive infrastructure of telecom operators

• Providing access to infrastructures of utility companies in other sectors

• Raising transparency on existing passive infrastructures via a single information point

2. Enhancing transparency and coordination of civil engineering works

• Enabling operators to benefit from clear announcements of the planned civil engineering works

• Systematically offering possibilities to lay new ducts or other infrastructure when public works are undertaken

3. Handling requests to rollout networks in a more efficient and transparent way

• Ensuring transparency and coordination of permit granting procedures

• Creating a single contact point concerning applications for permits

• Ensuring timely decisions

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Figure 5: Comparison between legal commitments and typical timescales for issuing base station planning permissions across Europe (Source: GSM Association)

Few best practices however do exist: certain municipalities from the Netherlands or from

the Scandinavian countries take an active coordination role regarding all necessary

permits besides rights of way. In some countries, such as the Netherlands, rights of way

are free of charge. A recent Greek law has also established a "one-stop-shop" for

obtaining all the necessary permits to roll out a radio-network. Exemptions exist for

certain categories of antennae and base stations in Greece and in the Netherlands. In

Portugal and Italy requests for certain permits are deemed as approved when no explicit

decision is taken within a given deadline ("tacit approval").

Yet surveys and feedback from industry show that such examples are an exception rather

than the rule (see Annex I). Operators consistently refer to permit granting as one of the

important problem areas in network development. Even if this problem cannot easily be

translated into significant costs, except for the cases where additional (and unreasonable)

works are required in exchange of rights of way, such delays and lack of transparency

severely affect the competitive dynamics in the electronic communications markets.

In conclusion, the most common problems quoted in relation to permit granting are (1)

the high number of different, uncoordinated rules and procedures, (2) the lack of

transparency on these rules and procedures, (3) the long delays and, in some cases, (4)

the unreasonable conditions, including fees, attached to rights of way.

2.4.4. High barriers to deploy in-house equipment in existing buildings

Connecting customers, which normally requires deploying in-building equipment is a

very expensive and cumbersome process. An operator willing to install or upgrade the

wiring in an existing multi-apartment building would typically need to bear the high

costs related to the vertical and horizontal wiring and to obtain permission from each and

every individual owner. Similarly, in the case of wireless networks, the costs of installing

equipment (in a visually acceptable way) would have to be borne and permissions would

be required from all owners.

Timescale for permit granting

4. Ensuring high-speed internet access to buildings

• Equipping new buildings ready for high-speed internet access

• Ensuring access to concentration point in new multi-dewellings

• Ensuring access to in-building physical infrastructure

• Thank you for your attention!