{"id":37147,"date":"2024-03-26T10:32:01","date_gmt":"2024-03-26T10:32:01","guid":{"rendered":"https:\/\/www.ispreview.co.uk\/?p=37147"},"modified":"2024-03-26T10:47:03","modified_gmt":"2024-03-26T10:47:03","slug":"ofcom-prep-next-major-market-review-to-boost-uk-gigabit-broadband","status":"publish","type":"post","link":"https:\/\/www.ispreview.co.uk\/index.php\/2024\/03\/ofcom-prep-next-major-market-review-to-boost-uk-gigabit-broadband.html","title":{"rendered":"Ofcom Start Next Major Market Review to Boost UK Gigabit Broadband"},"content":{"rendered":"

The national UK telecoms, media and internet regulator, Ofcom<\/a>, has today begun the early evidence gathering and development phase for their next major review of the UK’s wholesale telecoms market – Telecoms Access Review 2026 (TAR), which will look to make changes that “promote competition and investment<\/em>” in gigabit broadband and business connectivity.<\/p>\n

In case anybody has forgotten. Ofcom<\/a> typically conducts a single holistic 5-yearly review of both the markets for Business Connectivity (i.e. Leased Lines \/ Ethernet and Dark Fibre etc.) and the more residential focused Wholesale Local Access <\/strong>(i.e. wholesale broadband products like FTTP<\/a> and copper-based FTTC<\/a> etc.) market. The review also looks at inter-exchange connectivity (IEC) and wholesale access to physical infrastructure (PIA etc.).<\/p>\n

NOTE:<\/strong> Ofcom<\/a> states that their last review helped to push gigabit-capable broadband cover to more than 23.2 million homes (78% of the UK) today, and more than 17.1 million homes (57%) can access full-fibre (FTTP<\/a>\/B) broadband.<\/div>\n

The outcome of the last review, which was published in March 2021 (here<\/a>), introduced a variety of key changes, such as regulation of Openreach<\/a> that varied by geography, a new Dark Fibre Access (DFA) product, measures to help retire legacy copper-based networks, restrictions on broadband discounts and new Quality of Service (QoS) standards.<\/p>\n

All of the above was designed to align with the Government’s efforts to boost 5G<\/a> mobile and \u201cfull fibre<\/em>\u201d network coverage and investment. Since then, we’ve seen a rapid acceleration of full fibre (FTTP<\/a>) coverage across the UK and by a wide mix of different network operators, albeit with the likes of Openreach<\/a>, Virgin Media<\/a> (VMO2 \/ Nexfibre<\/a>) and CityFibre<\/a> still harbouring some of the biggest plans.<\/p>\n

Admittedly the progress, particularly from many newer alternative networks, has slowed a bit over the past year, albeit due more to the worsening economic climate than Ofcom’s regulation (e.g. high interest rates, rising build costs and aggressive competition). But this may also be a factor in how the regulator approaches its next review.<\/p>\n

What comes next?<\/strong><\/span><\/h3>\n

In the past it was often easier to predict the sort of areas that Ofcom might need to focus on and the changes they’d make, but it won’t be quite so straightforward this time. This is partly because the regulator will need to avoid doing anything that might upset the current inward flow of investment, particularly while that flow is under such strain and many of the network builds are only just entering the middle of their deployment cycles.<\/p>\n

On top of that, Ofcom’s review seems likely to be occurring at a time of significant political change, which could see a new Government coming into power and one that may have different views about how to approach the thorny issue of market regulation. Suffice to say that all of this inevitably starts with position setting and evidence gathering phase, only after that completes will we get a better idea of the direction Ofcom may look to take.<\/p>\n

Ofcom’s Statement<\/strong><\/p>\n

This document sets out Ofcom\u2019s approach and timetable for the Telecoms Access Review 2026 (TAR 2026) \u2013 which will replace the regulation that applies to fixed telecoms markets, set by the Wholesale Fixed Telecoms Market Review 2021 (WFTMR). The regulation underpins broadband and business connections, and the connections used by communications providers, including mobile operators, to support their services. The review is designed to promote competition and investment in gigabit-capable networks \u2013 the future-proof infrastructure that delivers faster, better broadband to people across the UK.<\/p>\n

Our decisions to date have incentivised and supported significant investment. Since 2021, Openreach<\/a> and many other companies have continued to invest in new gigabit-capable networks. Gigabit-capable broadband is now available to 23.2 million homes (78% of the UK) and more than 17.1 million homes (57% of the UK) can now access full-fibre broadband. Operators\u2019 plans for network deployment over the next three years remain significant.<\/p>\n

Ofcom will continue with the same underlying objectives of incentivising investment and promoting network competition. We consider that the long-term nature of network investments requires certainty and stability of regulation. We recognised this in 2021 and therefore set expectations about future regulation, which stands as the starting point for this review. While the previous review set out a 10 year overarching strategy, the market review process requires us to review the relevant markets taking account of recent and prospective market developments.<\/p>\n

We recognise the huge strides made by the industry in rolling out full-fibre networks, but we also recognise the challenges facing companies deploying these networks. A key focus of this review will be our approach to promoting network competition. In particular, we want to see network competition continue to develop where this is sustainable and where it delivers benefits to consumers.<\/p>\n

We also want to continue to promote efficient commercial deployments to further extend coverage in the remaining, harder to reach areas. Our regulation complements public funding programmes that we expect will remain a prominent feature of fibre rollout in the next review.<\/p><\/blockquote>\n

However, we do expect that the regulator may have a closer look at Openreach’s approach to FTTP pricing, particularly their “Equinox<\/em>” discounts and how much flexibility can be allowed in the future. Equally, it’s possible that we may see a return to discussions about wavelength unbundling on FTTP lines, but Openreach will probably also hold up the carrot of an expanded FTTP rollout (potentially 30 million premises by 2030) and encourage the regulator not to inhibit their investment (i.e. the “fair bet<\/em>“).<\/p>\n

In terms of other areas that could see some changes, we’d expect the usual updates to Openreach’s minimum service levels (QoS standards) and Ofcom will most likely have a deeper look at the Hull area. The latter is where alternative networks like MS3<\/a> and Connexin<\/a> have been trying, with little success<\/a>, to gain access to KCOM<\/a>’s existing infrastructure in order to run their own fibre and avoid deploying new poles (local campaigners are strongly opposed to “ugly<\/em>” poles). But KCOM<\/a> aren’t currently required to offer the same level of Physical Infrastructure Access (PIA) as Openreach and Ofcom might look to change that.<\/p>\n

The reality here is that we might have to wait until the review after next (post-2031) before we start to see another major change in the market, not least because that will be moving into a post-copper future and by then we may also have a much better idea of how much fibre coverage alternative networks (AltNets) have been able to deliver (i.e. who is left standing). But there will still be plenty of big changes in this review.<\/p>\n

As usual, Ofcom will have the incredibly difficult job of trying to balance the many competing (vested) interests between different operators, and inevitably this will always result in some winners and losers. The regulator expects to publish their first solid proposals for the next review by “early next year<\/em>“, with a view to publishing their final decisions in early 2026.<\/p>\n

Telecoms Access Review 2026 – Strategy Document<\/strong><\/span>
\nhttps:\/\/www.ofcom.org.uk\/..\/telecoms-access-review-2026.pdf<\/a><\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

The national UK telecoms, media and internet regulator, Ofcom, has today begun the early evidence gathering and development phase for their next major review of the UK’s wholesale telecoms market – Telecoms Access Review 2026 (TAR), which will look to make changes that “promote competition and investment” in gigabit broadband and business connectivity.<\/p>\n","protected":false},"author":1,"featured_media":37150,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0,"footnotes":""},"categories":[1,1645],"tags":[474,471,472,478,52,55,56,36,69,38,1997],"class_list":["post-37147","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uk_isp_news","category-key_uk_isp_industry_developments","tag-bt","tag-bduk","tag-business","tag-ethernet","tag-fibre-optic","tag-fttc","tag-fttp","tag-ofcom-regulation","tag-bt-openreach","tag-politics","tag-uk-gigabit-programme"],"share_on_mastodon":{"url":"https:\/\/mastodon.social\/@ispreview\/112161536467476513","error":""},"yoast_head":"\nOfcom Start Next Major Market Review to Boost UK Gigabit Broadband - 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