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Cityfibre on the Challenges of Copper to Full Fibre Migration

Friday, February 28th, 2020 (7:03 am) - Score 3,385

Cityfibre has provided ISPreview with an update on their on-going ‘Copper to fibre switchover‘ consultation, which considers the question of retiring Openreach’s (BT) old copper telephone lines in favour of “full fibre” (FTTP) broadband, albeit from the perspective of an alternative network provider.

At present most of the focus in the planning for copper switch-off and migration has tended to centre around Openreach’s national network, which is hardly surprising because they control most of the UK’s legacy copper infrastructure and are expected to have the single largest Fibre-to-the-Premises (FTTP) network by around 2025 (15 million premises). Related trials are already underway (here and here), such as in Salisbury.

NOTE: Over the longer term it makes no sense to maintain older legacy copper networks alongside fibre as this would be costly and discourage FTTP investment.

However alternative network (AltNet) providers like Cityfibre (aiming to cover 8 million premises) are keen to remind the Government and Ofcom, as well as perhaps consumers too, that Openreach is not the only full fibre game in town. Indeed in some parts of the country there will be locations where Cityfibre is the only choice for FTTP, while in others it could be the case that several FTTP providers may operate in the same area (overbuild).

Suffice to say that Cityfibre’s consultation, which began last November (here), is centred around engaging the wider industry over this issue and ensuring that any future switch-over is pro-competitive, “so processes are in place to support easy switching between networks.” Ofcom’s on-going work to integrate the new European Electronic Communications Code (EECC) also touches on this area (here).

Cityfibre thus aims to give ISPs of all sizes an opportunity to stipulate what provisions would be required to support all legacy services on the new network(s), what the process should be for mass migration of customers, and what steps are needed to ensure easy and hassle-free switching for consumers.

Full fibre or nothing?

As part of this consultation ISPreview has engaged with Cityfibre’s Director of Regulatory Affairs, Alex Blowers, to query the operator’s approach and some of the more challenging aspects of its consultation. For example, the Government’s recent switch to adopt “gigabit-capable” language has opened this debate up because we now have to look at more than just full fibre networks, with Virgin Media’s cable (HFC) and possibly even fixed wireless or 5G networks having a role to play too.

As for HFC upgrades, these may be good news for Virgin Media’s existing customers, but as Virgin Media operates a closed network, they are not relevant to the central challenge of migrating the existing copper customers of ISPs onto a ‘gigabit capable’ network,” said Alex.

We suspect that Virgin may choose to disagree with the above statement, not least since they’ll be bringing 1Gbps+ speeds across their entire network by late 2021 (15 million premises). Likewise their network may not remain closed for long, particularly if the predicted Liberty Networks change goes ahead and opens it up to wholesale (here and here).

Separately Cityfibre suggests “there is no reason why, in the context of legal separation of BT Group and Openreach, BT itself should not set up to consume other full fibre networks,” which is an interesting viewpoint. BT Group ultimately still funds Openreach and their roll-out of FTTP, thus the idea that BT’s consumer ISP would hop on to harness Cityfibre’s platform seems flaky but not impossible (they never did that with copper LLU either).

However, despite a few unusual viewpoints, Cityfibre’s consultation is important and asks some of the right questions. Indeed these are questions that other altnets should also be considering. Clearly, city-wide full fibre rollouts are not yet reaching completion at scale but it won’t be far off at the rate the industry is now moving.

The operator’s consultation is due to end on 6th March 2020, although it may yet be extended and after that a final report is expected to follow within another couple of months. In the meantime you can read our brief Q&A with Alex below, which touches on just a few of the often tricky issues that have been raised.

Q&A with Alex Blowers (Cityfibre’s copper switchover)

1. The consultation talks a lot about the Government’s plans to achieve UK-wide full fibre coverage by 2025, but sadly this changed last year and over a month before the consultation itself was published.

The Government now talks about ensuring that every home can access “gigabit-capable” broadband by 2025, which they suggest includes full fibre, hybrid fibre coax and 5G / fixed wireless etc. As a result quite a few points in the consultation now give and exist in the wrong context.

Why wasn’t this change included into the consultation before publication and what impact does it have on Cityfibre now that the focus is not purely on full fibre (e.g. Virgin Media, mobile operators and others all have a role)?

ANSWER:

Our focus is clearly on the full fibre network that we are building. We think this is the superior, future-proofed technology to HFC and FWA (see the study we commissioned from Plum recently). We understand the Government has softened the target language to provide more flexibility in delivering an ambitious target by 2025.

FWA may have a role to play in rural, but cost-effective technology solutions are currently unproven. As for HFC upgrades, these may be good news for Virgin Media’s existing customers, but as Virgin Media operates a closed network, they are not relevant to the central challenge of migrating the existing copper customers of ISPs onto a ‘gigabit capable’ network. As far as we are aware, no-one is suggesting that customers will migrate from copper to anything other than full fibre where it exists.

We also know, because it has already been discussed at the regular DCMS CEO roundtable, that a plan for copper to fibre switchover is seen by the Government as an important part of the overall plan.

So, our view is that the core challenge is unchanged – how to plan and manage the migration of existing copper customers onto full fibre networks, in line with a challenging 2025 target. The focus to date has been unduly oriented towards Openreach’s own business decision-making. Self-evidently, with CF now planning to build up to 8 million FTTP connections, we are necessarily a part of this debate.

2. The consultation warns that, in areas where two full fibre networks are present, it could undermine competition because “Openreach would be free to define the process as entirely a matter of switching from copper to its own full fibre, at a time of its choosing.”

Absolutely it’s right that Ofcom should consider alternative full fibre networks in any related regulation, although there is a danger here that we end up focusing too much on the network supplier and forget about the end ISP (consumer contracts are with the ISP, not the wholesale network supplier). Long contract terms can also restrict switching away from ISPs.

Ultimately consumers take their service from an ISP and that ISP chooses what networks to use or not, which will of course govern how they respond to the migration challenge. In that sense don’t Cityfibre and other alternative networks have to play their part by ensuring and helping more ISPs to support their network? It seems like this, more than anything else (except availability), may impact network choice. The choice of network cannot realistically be forced on to ISPs.

ANSWER:

We don’t disagree: the purpose of our consultation is to begin a conversation with both ISPs and consumer groups. As an open access network, we want as many ISPs and their consumers on our network as possible. This includes BT’s downstream business as well. There is no reason why, in the context of legal separation of BT Group and Openreach, BT itself should not set up to consume other full fibre networks and indeed we have sent the consultation to them and encouraged them to respond.

The consultation is specifically asking:

• What products do ISPs require us to provide to replicate current service offerings on copper?
• What migration processes do you require CF to provide to switch customers to our platform? And:
• What do you need from us in terms of an ordering and provisioning process?

3. Following on from no.2 above, do you think Cityfibre could be doing more to provide support and services that might help ISPs to adopt their network, especially smaller residential players? Some ISPs tell us that it can be a prohibitively complex and costly development process to adopt a new network.

ANSWER:

We are a wholesale only open access network. We want to have as many ISPs on our network as possible. We are building a platform of sufficient scale that it is worthwhile for major ISPs to set up to consume it. Our latest plan is to build a network connecting up to 8 million premises which addresses this point.

Second, consuming our platform needs to be as easy as possible for operators already set up to consume Openreach. For that reason, we have developed an offering that makes the switch from Openreach to CityFibre as seamless as possible whilst also seeking to deliver substantial operational improvements over those available via Openreach.

We want to be easy to use for existing ISPs and for new entrants. We want this consultation to open up a dialogue with a broad range of ISPs to make sure we are doing everything we can to accommodate their requirements.

4. Following on from no.2 again, most full fibre alternative network-based ISPs have chosen not to sign-up to some of Ofcom’s voluntary codes of practice (e.g. broadband speeds, automatic compensation code etc.). Would you agree that there is an argument that says this needs to change so consumers receive the best possible protection during any switch-over, particularly if we reach the latter stage of enforced migrations further down the road?

ANSWER:

As a wholesale only operator, we don’t really have a view on how ISPs should manage their retail regulatory obligations.

5. At what point do you think a specific location / area should start the switchover process from copper and how long should it take (what sort of process do you envisage)? Openreach proposed a process for moving from copper to FTTP lines once 75% of premises in a related exchange are able to receive an “ultrafast” 100Mbps+ broadband service (target for this is 24 months after roll-out starts and copper switch-off might then occur c.3 years after / on top of that).

ANSWER:

We think the focus right now should be on making voluntary migration from copper to fibre as attractive as possible. The copper to fibre transition is at a very early stage both in terms of rollout and adoption where available. Our consultation is an attempt to drive voluntary migration in scale now, rather than design a compulsory migration scheme.

Analogous forced migrations from a legacy infrastructure (e.g. analogue to digital satellite) has generally only been implemented once the majority of the consumer base has already voluntarily migrated. This approach has two advantages: there is already widespread consumer acceptance of the need to change, and any practical or technical problems have generally been ironed out by the time there is a compulsory migration of the remainder. In the light of that previous experience, we are surprised that Openreach is proposing to begin a compulsory transfer process when it hits a build target, rather than a voluntary adoption target.

This also increases the urgency of opening up the dialogue to consider the scenario where alternative full fibre providers have hit the same indicative rollout threshold in a given area. We expect to hit the 75% rollout target which triggers Openreach’s ‘stop sell’ on copper products in at least two locations within this calendar year.

6. Openreach are expected to offer both a voice-only (VoIP) and entry-level (e.g. 40Mbps) broadband product via FTTP as part of their process. Does Cityfibre intend to do something similar with their ISP partners (can you give examples / ideas?), which may be particularly important if you intend to target the same customer base as Openreach facilitate via copper (includes vulnerable consumers with voice-only needs etc.)?

ANSWER:

Yes, this is one of the key issues on which we are looking for feedback. We are very conscious that within ISPs’ existing customer bases there will be many consumers who are currently consuming either voice only or entry-level broadband products, and we want to understand what products ISPs want in order to match their customers’ requirements.

7. Ofcom are currently looking to include FTTP services into their future all-IP migration rules / process, which may require alternative networks to adopt an agreed industry process (possibly Gaining Provider Led) like currently exists on Openreach based ISPs, as well as to also factor in how phone numbers are ported for VoIP etc.

Have you engaged or do you intend to engage much with the regulator’s / OTA’s work (AIP-MTP) on this front and what recommendations do you have for that process?

ANSWER:

We are participating directly in the GPL Switching process and observing the All-IP work.

We think that GPL should be a standard process for all intra and inter-platform switches and welcome the plan to implement the new requirements of the EECC. Our recommendations are that a ‘true GPL’ approach is adopted, rather than a hybrid, code-based approach. This will deliver the best consumer experience and a competitive level playing field.

We’d just like to thank Alex Blowers for giving us the opportunity to query some of the challenges raised by their consultation.

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22 Responses
  1. Avatar Him

    Once again Cityfibre are sticking their nose in, trying their best to dent Openreach’s FTTP share. They have nothing to do with the copper network that is owned by another business!

    • Avatar CarlT

      They are a direct competitor. They were invited as part of a consultation to speak/write on the matter. They have every right to ‘stick their nose in’ and it would be breaching their obligations to their shareholders, or at very least stunning incompetence, not to.

  2. Avatar Jim Weir

    If Virgin customers (using virgin for voice) aren’t relevant to the switchover, then the same follows that any other Alternative network customer (using VoIP) is also irrelevant to switchover… including Customers using ISP on CityFibre network.

    Forced migration from copper isn’t a given opportunity to change supplier. If a customers current contracted supplier can still deliver the contracted service, the underlying technology or operator isn’t relevant to the customer.

    • Avatar CarlT

      I don’t understand, sorry. The point was that Virgin Media are, at this time, a closed network. With that in mind they’re irrelevant to migrating people away from copper on a wider basis.

      It’s a perfectly reasonable point given the regulatory context of the discussion.

    • Avatar Jim Weir

      As is City Fibre (vodafone) as of now.

      A property could have out of service Openreach copper but have live VM (with voice service), so the question is do Openreach have to provide provision for FTTP / VDSL there in case someone wants service in future in order to decommission the copper for that area?

      Nothing wrong with CF asking for input, but unless they take on responsibility for voice USO then the burden remains on Openreach to provide the statutory service regardless of any AltNets coverage.

    • Avatar A_Builder

      Well

      The USO (voice) obligation should be met by either copper or a wholesaleble FTTP provision. Similarly with BB all that there should be is a floor USO (up and down) that ramps up with time. So ATM VM can easily meet a 30/30 USO service. In time these needs to rise to 50/50 and 100/1000 on a calculated glide path.

      Who provides the FTTP is irrelevant.

      This will mean that Alt Nets Will have to accept solcial tiers. Although TBH Community Fibre et al already offer an-it works-fine-for-basic-online style packages.

  3. Avatar Meadmodj

    FTTP is now making progress and ramping up with other Altnets proposing to join at significant levels.
    The VM HFC network is available to a very large population and can provide effective Ultra speeds for many years while FTTP continues.
    ISPs are free to make arrangements with whatever network providers there see fit, mixing and matching as required.
    Cityfibre state “We are a wholesale only open access network” but that currently isn’t the case and would they willing to introduce voice only or other low tier products?
    OR does not have a presence on some New Builds (e.g OFNL etc)

    Therefore my view is simply that the copper pair discussion should be between OR and it’s customers. Other network providers and ISPs should go fish. We do not need more regulation which however well intended may result in stalling or distorting investment. It’s not my preference but we have a market driven approach so let the market get on with it.

    BT at some stage soon will start to move towards VoBB for themselves and their resellers. Other ISPs can utilise this or provide their own VoIP/VoBB.

    Ofcom’s role should be to ensure the effective closure of OR copper based products to enable effective continued OR FTTP investment not in anyway enforce closure of copper. Surely you can’t have customers “forced” to move from a regulated supplier to an unregulated Altnet supplier. BT/OR plans are based on traditional exchange areas whereas Altnets are more loosely geographical and often only have a percentage coverage. OR can only recover a cable when the last pair used ceases so it has to be their call.

  4. Avatar James Band

    Will the pricing for FTTP of 1000Mbps by ISPs be reasonable for consumers post this March 2020 date? And what about October as per a recent article on here? Seems like it would be embarrassing to tell consumers it’s £70-80 a month versus Cityfibre who seem to be pricing much lower?

    I’ve had to use 4G data to get any internet where I am and need the internet for work. With more people moving back home, gonna need fast internet. ADSL was only 2 Mbps here and unreliable (hence I used multiple 4G mifis). I can see now 2 months ago, my area was declared FTTP ready by Openreach. It said on the DSL checker up to 330, but last week suddenly changed to “up to 1000”.

    Needless to say, I’m thrilled by the prospect of 1000Mbps. What I don’t understand is the pricing by ISPs like BT, Zen right now. Vodafone (current provider on FTTC) are offering Gigafast via CityFibre for what… £40-48 a month for 900Mbps (and that’s symmetrical). BT (or anyone else like Zen) via Openreach will surely have to base their 1000Mbps price at a similar level – e.g. £48, otherwise they’d be giving an open goal to Vodafone/CityFibre surely?

    Charging £80 or something for 1000 if Vodafone are charging half the price surely wouldn’t look good! The price right now of £49.99 by BT for 300 seems bizarre enough as it is. What would the national pricing structure be for 1000Mbps on Openreach? And I can Virgin Media are now stating £62 a month on their network according to the BBC today. Seems like a mess

    • Avatar Meadmodj

      Yes.
      Pricing is based on market share. Vodfone charges are currently low but will that continue?
      Different ISPs bundle product extras and have different backhaul policies (some may limit capacity investment and hope they won’t get overloaded too soon)

      First step for many is getting an effective broadband at all
      Second is getting Ultra
      Third is Giga
      Fourth is probably Giga FTTP competition

      Post code lottery, looks like you jumping to 3, so good for you if you are prepared to pay for it. Don’t expect prices to come down in the long ru, just that speeds will increase slightly and be guaranteed on the better technology.

    • Avatar SoldierSoldier

      Vodafone will soon be using Openreach for its Gigafast product range, areas slated to get it later this year are Liverpool and Birmingham. This was announced earlier this year when they posted their quarterly results

    • Avatar James Band

      Meadmodj

      Actually looks like I’m jumping for Point 4 immediately and demanding perfection. Someone showed me the prices in Singapore (where they even offer 10Gbps speeds) for 1000Mbps and it makes us look like a joke over here. Even with larger country networks, I think other places like South Korea and to a certain extent Portugal/Spain have done far better (though we might catch up if we get our act together).

      But do you see my point. I’m asking about ISP pricing. Vodafone started their Gigafast product 900Mbps package at £48-56 a month which has since dropped to £40-48 a month.

      So how is BT going to launch with fanfare their “1000Mbps” product for anything more than let’s say £50-55 a month without having egg on their faces as to why Vodafone can “do it cheaper”. Let’s not forget some of the other characters are offering symmetrical, whether people want it or not. Virgin Media offering 1000Mbps for £62 according to the BBC today seems too high versus others’ pricing. Ultimately with nationwide pricing for a product, the retailer will have to appear to sell at a reasonable rate versus a competitor, irrespective of whether the “backhaul” is Openreach, CityFibre, B4RN or whoever.

      So if Gigafast by Vodafone is £40-48 or even goes back to £48-56, surely BT will HAVE to market their product at approx. £50 a month for the top 1000 retail product if offered after March?

    • Avatar James Band

      SoldierSoldier

      Would Vodafone not just simply offer FTTP via Openreach nationwide? That way they could grab market share from BT for FTTP. Why only offer it in Liverpool versus any area that has FTTP?

      The only thing is their “Gigafast” product (via CityFibre) is symmetrical unlike the Openreach offering. So how would Vodafone price an FTTP 900 on Openreach? Even then, their £40-48 a month is cheaper than BT’s current £49.99 for 300!

      Surely BT would have to offer FTTP 1000 to the consumer at around the £50 mark so as not to avoid losing custom to Vodafone and not to have egg on their faces?

    • Avatar CJ

      Vodafone are trying to build market share, as are Cityfibre. Loss-leader pricing is a tried and tested way for new entrants to do that, with every intention of increasing prices later when they have achieved scale.

      Are BT worried about having egg on their faces because they charge 40% more than Vodafone or TalkTalk for FTTC today? Have we all switched to Vodafone or TalkTalk because they’re cheaper? I don’t think so.

      Price competition will sort itself out in the end where there are competing networks. First we need to get there and that needs investors to believe there will be a decent enough return on investment to make it viable beyond just the densest urban areas.

    • Avatar James Band

      CJ

      People have switched away from BT (or away from other networks) when they have a choice. Take a look at the share price of BT for the last 2 years.

      It will look absolutely stupid if BT want to charge £60-70 for FTTP 1000 (non symmetrical) if Vodafone charged £48-56 when they introduced Gigafast 900 symmetrical, and dropped the price to £40-48 recently.

  5. Avatar FibreBubble

    Ofcom shouldn’t be assisting CityFibre’s monster investment banker owners in their speculative ventures. They are big enough to stand on their own feet.

    • Avatar John Uncle

      In that case, Ofcom should ALSO stop assisting Openreach’s ISP stakeholder/owner known as BT. Blatant conflict of interests and vested interests at play.

      If the regulator had any spine and principles they would have long ago:
      1. Split off Openreach from BT in totality
      2. Made it illegal to call FTTC a Fibre product
      3. Regulated pricing to ban those areas that can only get 1-3Mbps being charged a price for a 30Mbps product
      4. Issued fines to ISPs for making customers wait let’s say over 30 minutes on the phone and especially when the issue is not resolved during the phone call – e.g. A fine of £50,000 per customer
      5. Issued fines for overcharges to a customer which are not the customer’s fault and owing to incompetence on the part of the ISP/mobile provider – e.g. A fine of £100,000 per incident
      6. Issued fines for customers getting charged for scam texts, telephone subscriptions etc owing to not being automatically “Opted in” to debit bars etc. E.g. A fine of £100,000 per incident

      If the regulator actually did its job, then the crooked ISPs, train companies etc would actually not be able to get away with stuff. Railways for instance – if they fined a train company £100,000 every time an individual train is more than 10 minutes late, you would suddenly see a massive drop in late trains.

      The minimum threshold for the USO on broadband is pathetic as well. 10 Mbps? It should be more like 70Mbps and increase every year up until 2025 and the supposed Gigabit target. The regulator should issue fines to Openreach for not delivering FTTP to a set target of homes every year to meet the 2025 target. Or else the government should tender out construction to upgrade all copper lines to Fibre and let Openreach compete with other private providers to win the contract for each county. The business benefits of going Ultrafast outweigh the costs and competition of a tender can drive the price down.

    • Avatar 125us

      Not much carrot there John? Why would anyone invest in and lend money to a business that faces such onerous conditions of operation? Those conditions wouldn’t improve broadband (or the railways), they’d just make the incumbents go bust and then no-one gets a better service and the government has to fund a bailout. Everyone loses.

    • Avatar John Uncle

      125us

      Compare our trains to the private train networks in Japan (zero train accidents, if you’re a minute late you get a card to show your employer, where trains are bullet trains) and to the fibre speeds/networks in Singapore (versus London), Japan, South Korea and Spain.

      Not sure how you think a carrot will work to train companies and ISPs, etc who are all regional monopolies and essentially an oligopoly cartel rather than based on true free market competition. And it is unacceptable how customers get fleeced, misbilled, have to waste their own time and ISPs/mobile providers don’t get fined fines which will hurt them to deter such behaviour. It is the same as giving a slap on the wrist to a criminal versus caning them.

    • Avatar 125us

      Christ. You’re all about the punishment aren’t you?

      If companies get slapped with massive fines, customers pay them. If service conditions are as onerous as you suggest, prices rocket, and customers pay.

      There are dozens, if not hundreds, of ISPs and independent network operators. Let the market decide.

      Caning is barbaric and has no place in modern society. It’s counter productive in every case and if you’re keen to see people physically attacked by the state maybe some counselling might help?

    • Avatar CarlT

      Zero train accidents?

      All bullet trains?

      Here’s a great example of what happens when it’s all stick and no carrot, alongside how incorrect the claims of zero train accidents and apparently all bullet trains are:

      https://en.wikipedia.org/wiki/Amagasaki_derailment

      ‘Investigators speculate that the driver may have been trying to make up this lost time by increasing the train’s speed beyond customary limits. Many reports from surviving passengers indicate that the train was traveling at a faster than normal speed. Furthermore, it is speculated that the driver may have felt stressed because he would have been punished for the two infractions. Ten months before the crash, the driver had been reprimanded for overshooting a station platform by 100 meters. In the minutes leading up to the derailment, he may have been thinking of the punishment he would have faced, and may have not been totally focused on driving.’

      ‘Drivers face financial penalties for lateness as well as being forced into harsh and humiliating retraining programs known as nikkin kyōiku (日勤教育, “dayshift education”), which include weeding and grass-cutting duties during the day. The final report officially concluded that the retraining system was one probable cause of the crash. This program consisted of severe verbal abuse, forcing the employees to repent by writing extensive reports. Also, during these times, drivers were forced to perform minor tasks, particularly involving cleaning, instead of their normal jobs. Many experts saw the process of nikkin kyoiku as a punishment and psychological torture, and not as driver retraining.’

    • Avatar CarlT

      While you’re commenting on Spain’s FTTP you may wish to remember it was deregulation, not the obsessive levels of regulation you apparently so desire, that made it happen.

      Telefonica, incumbent in Spain, were permitted to build FTTP and not have to sell to all operators equally, they could keep some tiers of service to themselves and their retail arm. As a result alternative networks built in Spain to compete. In addition copper switch-off was expedited there.

      The Spanish market is a prime example of successful deregulation and a relatively free market being a success.

    • Avatar John Uncle

      125us

      What is barbaric is fleecing commuters to have to stand in tin cans and running a shoddy service, whilst claiming that they deliver the best trains in Europe. The number of late trains, or significant accidents is negligible in places like Japan, China, South Korea. When even the French have high speed rail – the FRENCH – and we don’t, then Britain is not living up to its potential.

      Caning in Singapore is for serious crimes and you have a free and fair trial. Irrespective of race, religion or wealth, if you commit such a serious offence you face the consequences.

      The British Railways are NOT a free market – it is a set of regional monopolies. That is not the case in Japan with MULTIPLE operators.

      The British Broadband market is not a free market when the underlying infrastructure is part owned by an ISP – a MAJOR CONFLICT OF INTERESTS. And in an environment of appalling regulation that protects vested interests and not the consumer or a level playing field for all PRIVATE ISPs to sell services to anyone nationwide, then Britain is languishing behind Europe, let alone East Asia.

      A report on this website showed the UK in the bottom 3 in an OECD report on FTTP rollout. Countries with a proper free market are in the top 10. Lithuania and Estonia are also ahead of us in terms of Europe.

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