Oftel has published a strategy statement setting out its regulatory approach to broadband.

Oftel's role is to create a coherent regulatory framework that allows competition in the delivery of broadband services to develop at all levels of the supply chain. Oftel will intervene where the presence of a company with market power could slow or block the rollout of broadband services.

The number of residential broadband users in the UK is still low, with around 250 000 customers using either cable modem or ADSL. Growth, however, is rapid, with a 500% increase in subscriber numbers in 2001.

Oftel is only one of the players involved in developing broadband markets in the UK. Technology and infrastructure, as well as content, will be provided by the industry while the Government has launched a number of intiiatives to stimulate takeup.

Most important of all, consumers will determine the eventual shape of the market as they choose what services they want, how they want them delivered and how much they are prepared to pay.

Oftel has identified broadband as a major area of work for the coming year.
Towards the end of last year, Oftel published several important decisions that will help to implement the objectives set out in the strategy:

DSL interconnection draft Determination

Following a request from the industry, Oftel has proposed new arrangements which will enable competing operators to interconnect with BT's DSL network to offer broadband services to consumers.

Operators currently have two options: either to buy BT's wholesale DSL products, or to install their own DSL equipment in BT's local exchanges through Local loop Unbundling. The new interconnection products Oftel has proposed will allow them to make full use of their own networks, while using BT's DSL network to reach the consumer.

Oftel expects that the new arrangements will allow operators to start offering broadband services to end users by the summer.

Draft Direction on partial private circuits

Oftel has made a range of proposals to resolve contractual and technical issues relating to wholesale partial private circuits (PPCs). PPCs are the wholesale components of leased lines, always-on connections linking two or more sites.

A second consultation, due to be published later this year, will consider charging and service level commitments, along with some outstanding technical issues.

LLU backhaul

Oftel has proposed that BT should be required to provide backhaul, which means that it must carry traffic from local loop unbundling operators' (LLUOs) equipment across BT's network and onto the operators' networks. Oftel has proposed that backhaul should be provided at cost orientated prices.

Local loop unbundling unescorted access determination

Oftel has confirmed that local loop unbundling operators must have unescorted access to BT's exchanges in order to carry out maintenance on their equipment.

Despite objections from BT, Oftel has directed BT to apply the same criteria to LLUOs as it does to its own contractors, so that escorted access will only be necessary where BT requires its own contractors to be accompanied.

This move will help ensure that LLUOs do not face unnecessary costs for providing broadband services over unbundled local loops.

As part of the consultation, Oftel considered the security implications of allowing unescorted access. These arrangements will not jeopardise security either at BT's exchanges or across the wider telecoms network.

LLU pricing determination

Following an Oftel investigation into BT's pricing for services associated with local loop unbundling, BT has been ordered to cut some of its charges.

The charge for line information tests (where BT test whether a line is suitable to carry DSL) has been halved, as has the premium charged for escorted access to exchanges.

Connection and rental charges for external tie cables (which link operators' equipment with BT's local exchanges) will be determined once Oftel has completed a separate analysis of competition in the relevant market.

For further information contact Ian Moss (tel: 020 7634 8861 / e-mail: ian.moss@oftel.gov.uk).All Oftel publications relating to broadband can now be found in a new broadband section of Oftel's website at www.oftel.gov.uk/publications/broadband/index.htm.