Space Management Part I Customer solutions, space allocation and funder priority

2 Key Points Our cabinets and other options are sufficient to cover most conceivable scenarios Overly prescriptive space management rules will create gold- plated, complex processes and drive costs Each of our customers has equipment and needs that are specific to them The business case is challenging – the party funding the cabinet should have confidence that they can utilise the space required for their business case

3 Chorus’ cabinets Chorus’ Distribution Cabinets include: Single bay Whisper cabinets Double bay Whisper cabinets USC cabinets Other legacy cabinets Radio huts, converted water tanks, etc. This presentation focuses primarily on the Whisper cabinets, which we think are of most interest to our customers. The Sub-loop STD will apply to all types of Distribution Cabinets.

4 Distribution Cabinets and the FTTN Programme Distribution Cabinet areas for the FTTN Programme are designed: (a)to ensure sub-loops have a maximum line loss of 60dB measured at 1024 Mhz. Practically, this means sub-loops have a maximum length of 2.4 kms in urban-type areas; (b)this is checked against a target maximum of 330 workers per area and an absolute maximum of 384 workers (so as not to exceed the capacity of the Telecom Wholesale Alcatel-Lucent 7302 ISAM); (c)in practice, engineering for (a) generally ensures (b), but in a few cases the design will need to be modified to reflect (b); (d)the cabinets are designed to minimise physical impact on the environment.

5 Single bay Whisper cabinet The single bay whisper cabinet has 27 Rack Units in the equipment bay: a single bay is designed to be used when the copper feeder is available and POTS services are provided using equipment in the Exchange; half a Rack Unit is required at the bottom for the fibre tray; the cabinet configuration requires 2 Rack Units of free space at the top of the bay for cooling; space may also be required between equipment for cooling.

6 Double bay Whisper cabinet The double bay whisper cabinet has 27 Rack Units in each of its two equipment bays: a double bay is designed to be used when the copper feeder is no longer available in sufficient quantities to support all End Users with voice from the Exchange. Double bays cannot be used without voice equipment as the termination area is not able to support SLES terminations. the double bay has the same heat management capability as a single bay cabinet; half a Rack Unit is required at the bottom for the fibre tray; the cabinet configuration requires 2 Rack Units of space at the top of each bay for cooling; space may also be required between equipment for cooling.

7 Covec and cost-benefit analysis Covec suggests that the Commission should conduct a cost- benefit analysis of additional cabinet space and the competitive benefits it facilitates. Clearly a build obligation that transfers our customers’ business risk onto us will encourage high risk/high return behaviour which will not be to the long term benefit of end users. If the Commission wished to take Covec’s advice and perform a cost-benefit analysis of the long-term interests of end-users it would need to do so properly (and it would need to make predictions of future competitive market structures –which Covec disapproves of). We suggest that working through facts and realistic assumptions (rather than a cost-benefit analysis) will bring us to a better conclusion, more quickly and with less speculation on future competitive structures.

8 Realistic assumptions Some realistic assumptions on co-location in our cabinets are: Telecom Wholesale will be present (at least initially) in all our cabinets; our customers will install equipment where they have either: (a) a significant market share or an intention to gain a significant market share; or (b) one or more high value customers off that cabinet; in scenario (a), our customer will employ a (potentially localised) mass marketing strategy and use DSLAM equipment that supports a significant number of workers; and in most cases there will only be 2 mass market providers with installed equipment; in the exceptions, our customers can build (or contract us to build) additional capacity as easily as we can; in scenario (b), our customer will employ smaller equipment to offer higher value, specialised services; in scenario (b) the end users are likely to have contracted with the service provider for an extended period or on special terms that make a wider range of co-location options, such as a pedestal, box on a pole, etc, feasible.

9 Customer solutions and funder priority The Whisper cabinets have enough space for more than one set of equipment, but there will always be exceptional circumstances, specialised business cases that require additional space, and the existence of non-Whisper cabinets Chorus is in the business of providing co-location space and we’ll work with our customers to develop solutions for their space needs The funder priority rule agreed by the TCF was designed to provide some confidence to those investing in cabinets that they would get the benefit of solutions created for them