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On 8 April 2004, Ofcom, the regulatory authority in the United Kingdom, issued a Statement with the rather cryptic title: "Discontinuation in part of continued provision Condition 43".


This Statement relates to the market reviews conducted by Oftel/Ofcom in accordance with the new EU directives, and, whilst it had been expected for several months now by experts closely following the UK situation, it can only be described as a development that is of particularly great importance.


The implication is the continuation of certain regulatory obligations (Condition 43: requirement to provide service, Condition 57: prohibition on undue preference and undue discrimination, and Condition 58: requirement of publication of charges and terms and conditions) on the SMP operators BT and Kingston, until certain relevant markets have fully been reviewed, and, where appropriate, SMP conditions are imposed.



The Ofcom statement of 8 April 2004 covers various markets.


This news item only addresses the Wholesale Broadband Access market (Market 12 of the European Commission's Recommendation on Relevant Markets Susceptible to Ex-Ante Regulation), or similar/adjacent markets.


As visitors to the T-REGS website will recall, Oftel had notified the European Commission of its market review relating to Market 12 (involving a segmentation of the market into "asymmetric broadband access", and "broadband conveyance", excluding IPStream from the market definition), and the European Commission's eCCTF had published a letter which broadly endorsed the Oftel approach, or at least did not make any statement of significance on the status of the BT wholesale product constituted by IPStream+BTCentral.


In this respect, Ofcom now included the following in its Statement:


"Ofcom does not consider that broadband intermediate services such as BT’s IPStream fall within its definition of Wholesale Broadband Access, and Ofcom’s review of this market did not include services such as IPStream. Several respondents to that consultation exercise, however, have expressed specific concern about this omission in their responses to the Wholesale Broadband Access consultation, and also in their responses to the January Consultation Document. Although the Commission has stated, in its response to the Wholesale Broadband Access review, that Ofcom’s position on IPStream is not inconsistent with the Commission’s regulatory approach to broadband markets, Ofcom is presently considering responses to the Broadband Access consultation and it would be premature to discontinue Continued Provision Condition 43 in respect of IPStream services until Ofcom has completed its evaluation of those responses."


In addition, Ofcom makes the interesting note that:


"For the purposes of this statement all references to “markets” shall include also a reference to IPStream services."

Conclusions:


  • Ofcom has NOT adopted its final decision on Market 12: Wholesale Broadband Access, even though the European Commission has essentially validated it, or at least not indicated opposition to it. 

 



  • Until such time as a final decision is taken by Ofcom, BT remains required to provide DataStream (ATM-based bitstream access, described as ATM interconnection in the UK, subject to detailed terms and conditions, including retail-minus wholesale charges, resulting from dispute resolution decisions made by Oftel in the past), and IPStream+BTCentral, a wholesale broadband product with IP hand-over).

 



  • As is indicated above, the implication of maintaining Condition 43 of the BT licence in effect as regards those wholesale products, is that it entails the continued application of the principle of non-discrimination (Condition 57) and a requirement to publish wholesale charges and terms and conditions (Condition 58).

The full text of the Ofcom statement on the selective and temporary continuation of Condition 43 can be accessed by clicking here.


For a discussion of the situation of the wholesale broadband market(s) in the United Kingdom, or other markets, please contact Yves Blondeel.