COMPETITION://Physical restraints stand in the way

What should the future of telco regulation look like?

Facilities-based competition would be preferable to reach a vibrant communications market:

• Operators can distinguish their services.
• The economy is stimulated through hardware sales.
• Consumers have a real choice.
• Bandwidth is best used.

There is however a number of physical restraints:

• We don't want the streets dug open time and again (soil or rights of way or whatever you want to call it is scarce).
• WiMAX, 4G and BPL aren't ready yet.
• Wireless spectrum is scarce.
• And also: the further fiber is pushed into the network, the smaller the cabinets, the less space there is for colocation.

Where does that leave us:

• US: No LLU, a telco v. cableco market. Slow BB adoption, high prices, slow speeds.
• UK: LLU and structural separation (BT Openreach). Finally high growth.
• France: LLU. A very competitive market.
• Germany: LLU (if not regulated very effectively). The government is trying to adopt the US model (at least temporarily).
• Australia: comparable to Germany, accept that the government will not give in to extortion. Altnets have united.

The EC seems to favor the UK model (even if Ben Verwaayen warns that any model cannot be exported very easily). But that leaves the matter of the physical restraint of street cabinets. Another problem is that ultimately, providing telco and cableco are worthy competitors, regulation of both should be equal.