News


Study highlights benefits of infrastructure competition

Infrastructure-based broadband competition for next-generation access services will allow migration to higher bandwidth networks, meeting consumer demand and allowing network operators to recoup their investment, according to a study commissioned by international cable operator Liberty Global from Bain & Company.

The survey cites the Netherlands as the poster child for infrastructure-based competition, where competition between cable and the fixed-line telecom infrastructure, covering over 80% of the population has resulted in average broadband speeds of 5.3Mbps, compared with 4Mbps in other western European markets. Countries with little fixed-line infrastructure competition including Greece have the lowest bandwidth and internet penetration, the study said.

The study, which will be presented to Information Society Commissioner Viviane Reding and is aimed at Brussels policymakers, says that the 45% of European households in areas where former telecom incumbents, cable operators and sometimes fibre network provider compete are more likely to benefit from higher speeds and greater broadband penetration.

The study, Next Generation Competition – Driving Innovation in Telecommunications, found that investment costs for next-generation access can vary from €65 to €1,500 per household, depending on technology, current infrastructure and population density. DOCSIS 3.0-based cable networks can be rolled out at lower cost than alternatives, according to Bain, which found that under certain assumptions a single massive upgrade effort would require ARPU to grow by 57% for FTTH networks, 19% for VDSL and only 11% for DOCSIS 3.0 to allow operators to recover their investment costs.