1. Broadband regulation in Denmark 24. September 2009 TRIS workshop Tomas Skov Lauridsen National IT and Telecom Agency, Denmark

2. What am I going to talk about? 1. Brief overview of the market 2. Broadband regulation in Denmark with focus on fibre 3. Proposed regulated access to TDC cable network

3. Broadband - technologies Most of the broadband subscriptions sold in Denmark are xDSL connections. Cable modem subscriptions is the second most common subscription. FTTH subscriptions still make up a rather small part of the total number of subscriptions though this share is growing.

4. Broadband – Retail market situation The market for broadband subscriptions is dominated by TDC (incumbent). More than half of all broadband subscriptions were sold by TDC. The second largest operator on the broadband market is Sonofon with a marketshare of around 13 %. Wholesale market shares (internal plus external sales included) is larger as service providers use TDCS network

5. TDC has a high proportion of the fixed line customers (1.2 million. customers), and TDC owns both the copper network and the largest cable-tv networks (YouSee). To ensure competition TDC is required to provide other broadband companies access to its copper. The other providers had at the end of 2008 approx. 343,000 customers on TDC's copper. NITA is also considering to require TDC to provide access to its cable-tv network. Conditions and prices for access to TDC's copper is important to secure that the other broadband companies can continue to deliver broadband products based on TDC's copper. Broadband – wholesale market situation

6. 2. Broadband regulation in Denmark with focus on fibre

7. FTTH subscriptions  The number of FTTH subscriptions sold in Denmark is increasing rapidly.  From the end of 2007 to the end of 2008 the number and subscriptions grew from just under 50,000 to 87,000.  The FTTH market is dominated by the power utility companies.

8. Coverage – FTTH, FTTx Number of subscribers end 2008: 110,000 October 2008 Coverage Postal districts

9. Fibre rollout The rollout of fibre is led by the power utilities. The fibre companies that are members of the Dansk Energi (Danish Energy) have an objective to invest over 10 billion Danish kroner in FTTH over a 10-year period. Up to 2008 the power utilities have invested about 5.5 billion Danish kroner in fibre. There rollout plan is to cover half of the Danish households by 2015.

10. Proposed broadband regulation in Denmark Note: Only access regulation. Market 4 – wholesale network infrastructure access (Final Decision) Unbundled local loop regulation upheld Fibre is not included in the market No significant supply of unbundled FTTH (internal and external) No significantdemand for unbundled FTTH (internal and external) Market 5 - wholesale broadband access (Draft decision) BSA regulation continued Fibre is included in the market No regulation on fibre since the SMP-operator (TDC) only operates very few FTTH If TDC deploys FTTH in larger scale regulation will be considered Cable broadband access mandated in draft

11. 3. Proposed regulated access to TDC cable network

12. Content of the Gartner report - What products will it be possible, based on a technical analysis, to provide in a wholesale market for broadband via the cable TV infrastructure? - What investments in technology will be necessary in order to realise this? - What impact will the provision of wholesale products have on TDC in terms of investment and current management?

13. The possible acces products (from the gartner report)

14. Overview of the products Product 1: Decentralised bitstream access with static sharing of capacity in YouSee's infrastructure. Each ISP is assigned a frequency spectrum in the infrastructure the use of which is controlled by the ISP. Product 2: Decentralised bitstream access with dynamic sharing of capacity in YouSee's infrastructure. YouSee and ISP share the frequency spectrum dynamically in the infrastructure, and the ISP is allowed to control traffic on a decentralised basis at 35 collection points. Product 3: Centralised bitstream access with dynamic sharing of capacity in YouSee's infrastructure. As product 2, but with one central collection point for traffic. Product 4: Resale of YouSee's products. The ISPs resell the products offered by YouSee.

15. Product 1 (Frequency access): Dedicated capacity to ISP (maximum freedom to offer content) No capacity sharing between ISPs Scarcity of channels for broadband (especially in the upstream) Limit on number of ISPs (two?) DOCSIS 3 uses channelbonding to provide higher speeds (future proof?)

16. Product 2 and 3 (Bitstream Access) Ability for some product differentiation Overbooking factor the similar for all ISPs Shared capacity amongst all users (sevices important) Number of ISPs not limited

17. Product 4 (Resale): Resale of network operators products Little possibility for product differentiation (on a technical level)

18. Special issues and challenges with cable broadband Point to multipoint network Network management Danish issue: Ownership structure of underlying networks ”…there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns -- the ones we don't know we don't know.” - Donald Rumsfeld

19. Thank you for your time Link to the gartner report on broadband