1. How to optimise the regulatory environment for NGA roll-out Key issues, regulatory strategy and tactics Paul Brisby Towerhouse Consulting LLP November 2010 1

2. Regulation is important –For big buyers of regulated inputs, up to c50% of cost - more than any other single line item –Openreach generates a significant proportion of BT Group EBITDA –Essential facility inputs of strategic importance In this presentation –A complex environment - stakeholders and policy goals –Key issues for the aspiring NGA network –Policy tools 2 Introduction

3. Everyone has a view on NGA –Government – BIS –Ofcom –Government – VOA / DCLG –Communications Providers – private sector –Communications Providers – public sector –European Commission –End users Different technologies Complex statutory framework Creates an unusual environment for effective regulatory action 3 A complex environment

4. The regulatory narrative - how many horses? –Late ‘90s – Oftel back 1 broadband horse –Early 2000s – Oftel back zero broadband horses –2003 onwards – Ofcom back multiple broadband horses –2010 – what are the key issues? How may NGA horses? PIA - the uses to which duct / pole access may be put; price, process SLU – price, process, automation FTTH regulation / fibre unbundling GEA – price, processes –BT / Competitors: is it a binary choice? Who to convince? –BIS may have the money. But... –Ofcom have [a lot of] the power 4 Key issues

5. Market reviews (e.g. WLA) Enterprise Act undertakings v. SMP conditions Lobbying Regulatory Disputes Regulatory Appeals The European Commission Conclusions Where to focus? When to invest? 5 Policy tools

6. Q&A Paul Brisby Managing Partner Towerhouse Consulting LLP paul@towerhouseconsulting.com www.towerhouseconsulting.com 6 Questions and answers