Thursday, October 26, 2006

CABLE OPEN ACCESS://Dutch decision raises many questions

The Dutch parliament's decision to impose open access on cable companies raises many questions. At first sight, it's a positive for KPN (it levels the playing field, KPN could be a service provider on MSO networks) and a negative for MSOs (new competition, new types of investments). The Netherlands are certainly not following the US model (no open access to either copper or coax) and it could be a precedent for European regulation.

It looks like cable open access is many years away. Still, leveling the playing field sounds fair.

Below, I have the translation of the bills that were passed (thanks to Citynet's Dirk van der Woude).

Questions raised include:
  • How will the EU respond? Is SMP relevant at all?
  • If line rental and services are to be separated, does open access concern (broadcast) TV only, or will it extend to (digital TV), BB and voice?
  • Will OPTA (or a different regulator?) go so far leveling the playing field demanding infrastructure-based competition, i.e. competitors installing gear at cable headends? Is this practical at all, from a technology point of view?
  • How will any costs of opening up the networks be divided among the MSO and the alternative service provider?
  • Will this allow UPC (Liberty Global) and Casema/Kabelcom/Multikabel (Warburg, Cinven) to merge, creating a near-nationwide network, further leveling the playing field?
  • How will Warburg and Cinven respond? Could the Kablecom takeover (from Essent) be in danger?
  • Longer term, is there room for three competing physical layers, now that munifiber is coming? Could it spur structural separation, all players using a single physical layer (owned by some state-owned body)?

Motion 1- Considering that the telecom sector more and more has strategies towards vertical integration of networks and services
- considering that this integration can hinder free competition between service providers
- considering that existing competion end telecom laws offer insufficient means to resist these competion barriers
- considering that government as well as parliament are in favour of a standing charge model (as proposed in the earlier accepted motion of MP Atsma of 2004)
- invites the government to propose within a year to parliament for changes in the Telecommunication law, by which the markets for infrastructure and services will strictly be divided by the introduction of a standing charge model as well as the prohibition of the conditional sale of network and services.
On the above motion the new Trade minister Wijn has said that it has all of his heart.

Motion 2
- Considering that developments in the telecom sector have been rapid,
- considering that there hardly is any difference anymore between telco and cable networks, form the perspectives of technology as well as use
- considering that free access for all service providers furthers innovation and ICT in the Netherlands
- invites the government to propose within a year to parliament for a change in the Telecommunication Law, leading to mandatory, open, non discriminatory access to all networks for all service providers.
Of this motion the new minister said that it might find problems in Brussels. He did not say that he disagreed with the gest of it.

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