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EC cracks down on local-loop unbundling

Failure to give access to local junction boxes could delay video over broadband, says the European Commission as it takes action against Ireland and four other states
Written by Graeme Wearden, Contributor

The European Commission has opened infringement proceedings against Ireland, Germany, France, the Netherlands and Portugal after accusing the countries of failing to properly implement EU regulations on local-loop unbundling.

Enterprise and Information Society Commissioner Erkki Liikanen said the EC would not tolerate further delays in the creation of competitive local telecoms access markets across Europe.

The five EC member states are accused of failing to make their incumbent telecoms companies provide precise details of how rival companies can gain access to their networks -- a process known as local-loop unbundling.

"Regulators and operators have had time to implement the requirements of the EU Regulation, and here can be no more delays in opening up the local access market to competition. The action we have already taken has had immediate results, and I hope that national authorities can move quickly to overcome the problems that we are addressing in this latest decision on unbundling," said Liikanen.

The Commission has said it is particularly concerned that potential local-loop unbundling operators in the five countries have not been told how they can access the "sub-loop" -- the junction boxes between individual houses and the local exchange.

This access -- known as distant collocation -- is vital for companies who might be planning to offer video services via broadband.

"These local sub-loops are important where the competing operator wants to be situated close to its clients, and are already a practical requirement for operators seeking to develop certain broadband technologies, such as VDSL," explained the Commission.

While ADSL can only offer a theoretical maximum download speed of around 6 megabits per second (mbps), VDSL (very-high data rate DSL) will be capable of 52.8mbps -- as long as the operator's equipment is within 1000 feet of the customer's home.

Any further away, and this data rate drops to a level that cannot support high-quality broadcasting. Few homes are within 1000 feet of their local exchange, so VDSL operators will have to install kit in junction boxes.

The EC has expressed concerns in the past that Europe's incumbent operators -- the former state-owned telecommunications giants whose monopolies were supposed to have been broken by privatisation -- could continue to dominate some areas of the telecoms market.

Competition commissioner Mario Monti has claimed that some incumbents are deliberately obstructing local-loop unbundling. With video-over-broadband expected to be a important consumer technology in the future, the EC is set to clamp down hard on those telcos it believes are trying to prevent smaller rivals from entering the market.

The EC brought similar infringement proceedings against Germany, Greece and Portugal at the end of 2001. It has now decided to close these earlier proceedings against Greece and Portugal because they have made the required changes. Germany -- which has also made changes -- is expected to be let off soon as well.

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