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AOL Invests Big In Unbundled Lines

Posted: 20th Jan, 2006 By: MarkJ
AOL UK has finally confirmed its plans to invest in Local Loop Unbundling (LLU), which is the process that will allow it to replace BT as the main provider of services over the telephone line. ADSL2+ broadband services are hinted at:

This will enable AOL to deliver Internet, telephony and other broadband related services, such as Video on demand, television over broadband and advanced gaming services, directly to these consumers.

AOL’s decision to invest in telecoms infrastructure in the UK follows Ofcom’s recent mandates on LLU and the Strategic Review of Telecommunications, which has laid down the regulations and targets that BT must adhere to as it opens up its local telephone network to competitors.

The initial phase of the programme, costing around £50m, will take place in the first half of 2006 and reach up to 300 exchanges in the UK, equivalent to 20% of UK households. If successful, AOL may extend this rollout to up to 1,000 exchanges in the UK, based on an estimated additional investment of £70m, in order to be able to offer the possibility of ‘unbundling’ the telephone line for more than 50% of UK households. AOL's investment in the local telephone network in the UK is being funded by parent company Time Warner.

AOL has completed beta testing of the LLU process in two London exchanges, Battersea and Ealing and has created a team of more than 100 people in the UK to carry out a large-scale LLU rollout. AOL’s unbundled services will be ADSL 2+ compatible, creating the potential for broadband services of more than 8Mbps in the future.

The AOL Internet service and AOL Talk are provided to UK subscribers by AOL Europe Services SARL, a company in the AOL group based in Luxembourg. AOL has more than 1.1m broadband subscribers out of a total of more than 2.3m members in the UK, as at November 2005. AOL members in the UK spent more than two billion hours connected to the Internet during 2005.
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