Ofcom sets out geographic market views    

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As part of long-term plans to support investment in fibre networks, UK comms regulator Ofcom has set out initial views on how to define geographic markets from 2021, when carrying out the next review of wholesale telecoms networks.

By spring 2021, Ofcom plans to have regulation in place that varies by geographic area. To promote greater certainty for investors, this new regulation will be in place for at least five years.  It will replace Ofcom’s Business Connectivity Market Review and its Wholesale Local Access Review.

In the coming years, Ofcom expects to see significant investment in new, competing fibre networks. But investment and competition will vary by geography. Ofcom accordingly intends to take a flexible approach to regulation, reflecting how many different competing fibre companies are present in a particular geographic area.

Ofcom’s initial thinking on how its competition assessments and regulation may vary by geography from 2021 are as follows:

  • In competitive areas where there are at least two existing networks in addition to Openreach, Ofcom would consider whether these alternative networks make those areas effectively competitive. Where this is the case, Ofcom would deregulate.
  • In potentially competitive areas where there is either: (i) at least one alternative network is already present; (ii) an alternative network provider has announced plans to build in the area; or (iii) Ofcom considers there is potential for entry, Ofcom’s focus will be on promoting investment and competitive entry.
  • In non-competitive areas where there are no alternative networks and where future network deployment at scale is unlikely, Ofcom’s objectives are to encourage investment by Openreach while protecting consumers from high prices.

Ofcom will gather data and deployment plans from operators to map existing and potential future networks. It proposes to use a number of criteria to determine areas of the UK where network rollout may be economically viable.

Ofcom intends to set out its initial approach to remedies in spring 2019; and by autumn 2019, it plans to consult on a full set of market proposals, including market definition, market power and remedies.

 


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