Openreach's decision not to launch access to its Dark Fibre infrastructure on October 1st following a ruling by the Competition Appeal Tribunal (CAT) has sent shock waves through the broadband connectivity market.
The news will be devastating to comms providers like TalkTalk and Vodafone who have been developing plans around a ‘regulated' dark fibre product. This would have bypassed the need to lease bandwidth from Openreach, which generates over £1bn for BT group each year.
But the news has been welcomed by UK independent dark fibre pioneer CityFibre.
Mark Collins, Director of strategy and Public Affairs at CityFibre (pictured), told Comms Dealer: "After Ofcom's flawed regulatory efforts in the Business Connectivity Market Review were overturned by the CAT, there is no legal basis to mandate the introduction of a regulated dark fibre product. Therefore, Openreach's decision not to proceed with a dark fibre offering is not a surprise.
"As one of the UK's largest suppliers of dark fibre infrastructure, CityFibre's growth and proven ability to attract investment, demonstrates that the competitive market for business connectivity, including commercial supply of dark fibre, is alive and well and not in need of disproportionate and unnecessary regulatory interference.
"Rather than continuing to drive increased dependency on Openreach, we suggest that Ofcom goes back to the drawing board to focus on delivering more appropriate and proportionate remedies that help meet its own strategic objectives to support increased competitive investment in full fibre for the UK."
In March 2016, the BCMR forced Openreach to cut its wholesale leased line prices, imposed harsh service standards and ruled have access to its dark fibre network to deliver their own connectivity services.
But Openreach appealed against this decision and the ruling has now been quashed.
In a ruling handed down at the end of July 2017, the Competition Appeals Tribunal (CAT) said Ofcom had blundered on a number of points namely: defining a single product market for contemporary interface symmetric broadband origination (CISBO) services of all bandwidth; concluding that the rest of the UK comprises a single geographic market; and its determination of the boundary between competitive core segments and the terminating segments of BT's network
In a statement Openreach said: "In light of the CAT ruling and following discussions between Ofcom and various parties involved in the CAT litigation, Openreach do not intend to launch DFA on 1 October 2017 or notify launch pricing at the end of August/early September 2017. We'll issue formal communications to CPs over the coming days.
"We are very keen to discuss with CPs what existing or future alternatives to dark fibre may meet their requirements."