ARCEP, the French telecoms regulator, is launching two public consultations to determine whether the risk of monopolization of fiber networks exists under the current regime, whereby fiber infrastructure is laid out by different entities without mutual sharing of access. ARCEP, the French telecoms regulator, is launching two public consultations before the summer to determine whether the risk of monopolization of fiber networks exists under the current regime, whereby fiber infrastructure is laid out by different entities without mutual sharing of access to fiber ducts or to the home.
In France, fiber optic networks are being deployed by local governments, France Telecom (the incumbent) and several new telecommunications companies such as Iliad/Free. ARCEP believes that the risk of a monopoly exists where one network owner denies access to another. ARCEP wants to know if regulations are necessary to prevent the creation of a monopoly.
Two ways that guarantee open access (and lower the risk of monopolization) are:
(1) Network owners share the fiber ducts: new entrants would use existing conduits such as the sewers or the ducts already laid down by a local government authority or France Telecom;
(2) Network owners share the connection to the user’s home. The first one to build the connection to the home should not be able to exclude competitors from offering services to that household.
Because ARCEP does not have a clear picture on how these issues are being resolved, they launched public consultations before the summer holidays.
How much are private firms in France investing in the deployment of these networks? According to les Echos, France Telecom is spending 3 to 4.5 billion Euros between now and 2012; Iliad (Free) is investing 1 billion over that same period; Neuf Cegetel is spending 300 million Euros between now and 2009, but they already bought two fiber optic network operators. Together with other smaller operators, the investment in covering all of France with fiber could exceed 30 billion Euros.
How will the fiber network owners recoup the investment? Although they will certainly offer paid subscriptions, the operators need to gain access to content, according to Paul Champsaur, president of ARCEP. Champsaur refers to the quasi-monopolistic position of cable television firms such as Canal Plus and the potential difficulty faced by fiber operators in convincing users to purchase their offerings.
My own thoughts: because of the massive amount of investment required to build a fiber optic network which will be open anyway to all companies that want to deliver services to the end user, doesn’t it make more sense for the government to spend this money and then offer it to all service providers? Isn’t this exactly that kind of infrastructure that is better funded with public funds and open to all? Isn’t asking one or two firms to shoulder the cost of a large fiber deployment unrealistic and unfair?
See French article in L’Expansion here. Please post comments below if my translation is inaccurate.
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