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Call for 'flexible' UK telecoms regulation to support convergence

The regulation of telecoms markets in the UK needs to be "flexible" and "forward-looking" to account for the convergence of fixed and mobile networks, the government has said.19 Feb 2019

The Department for Digital, Culture, Media and Sport (DCMS) said that, in future, some consumers could see '5G' mobile technology as "a viable alternative" to fixed-line fibre broadband services. It said Ofcom should regulate the market accordingly.

"The policy and regulatory framework should be sufficiently flexible and forward-looking to support convergence between fixed and mobile networks, through: removing practical obstacles or barriers to the deployment of converged networks…; single, unified access market reviews that recognise the convergence of access networks to serve business, residential and mobile requirements; and allowing mobile operators to benefit from unrestricted use of Openreach’s passive infrastructure for the provision of backhaul services, as soon as possible," DCMS said (32-page / 338KB PDF).

"If duct and pole access is unavailable or ineffective, the government would like Ofcom to consider the merits of alternative effective remedies, including dark fibre access," it said.

The government's view was set out in a draft statement of strategic priorities (SSP). The government has power under the Digital Economy Act to issue an SSP which Ofcom would have to have regard to when undertaking its regulation of telecoms markets. It is the first time since the Act was finalised that the government has moved to outline an SSP.

According to the proposals, the UK's four main mobile network operators could in future be required to enable roaming across their different networks to improve connectivity.

"Roaming in rural areas also has the potential to improve consumer choice and address partial not-spots (where one or more operators are present, but all four are not)," the government said. "Ofcom should fully consider the costs and benefits of achieving this outcome, and maintain the option of requiring roaming by including appropriate provisions when granting rights of use for spectrum."

The government further endorsed shared spectrum models and plans to boost the sharing of telecoms duct and poles, as well as a move to greater geographic differentiation in the way telecoms markets are regulated in the UK.

It further said telecoms companies need more clarity to feel incentivised into investing in future telecoms infrastructure.

"The regulatory environment should ensure there is clarity regarding the application of the ‘fair bet’ principle over an extended time scale," DCMS said. "The government’s view is that an effective ‘fair bet’ regime would be one that allows firms making large and risky investments to have confidence that any regulation will reflect a fair return on investment, commensurate to the level of risk incurred at the time of making the investment decision. Ofcom should publish clear guidance that sets out the approach and information it will use in determining a ‘fair bet’ return."

Plans to support data portability in the telecoms market should also be pursued, the government said.

Jeremy Wright, the UK's secretary for digital, culture, media and sport, said: "As the UK’s independent regulator, Ofcom has a critical role in delivery of the country’s gigabit aspirations - and that is why this statement of strategic priorities (SSP), which Ofcom must have regard to when carrying out its regulatory functions, is such a key part of delivering the government’s ambitions for connectivity."

"The first of its kind for the sector, the SSP reiterates the regulatory outcomes the government thinks are necessary to create a pro-competitive and pro-investment environment – from the importance of stable and long-term regulation in the delivery of full fibre, to an assessment of the feasibility of flexible spectrum licensing models," he said.

The UK government said last summer that it wants 5G mobile technology to be available in "the majority" of the UK by 2027, and for homes and businesses "nationwide" in the UK to have access to 'full fibre' broadband networks by 2033 – 15 million by 2025. It has also backed investment in ultrafast broadband and the introduction of a new universal service obligation for broadband.