Wholesale High Quality Access at a Fixed Location
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Market Review: Wholesale High Quality Access at a Fixed Location Consultation and Draft Decision Reference: ComReg16/69 Date: 18/08/2016 Legal Disclaimer This Consultation is not a binding legal document also does not contain legal, commercial, financial, technical or other advice. The Commission for Communications Regulation (‘ComReg’) is not bound by it, or does it necessarily set out ComReg’s final or definitive position on particular matters. To the extent that there might be any inconsistency between the contents of this document and the due exercise by ComReg of its functions and powers, and the carrying out by it of its duties and the achievement of relevant objectives under law, such contents are without prejudice to the legal position of ComReg. Inappropriate reliance ought not therefore be placed on the contents of this document. Redacted Information Please note that this is a non-confidential version of the Consultation. Certain information within the Consultation and Draft Decision has been redacted for reasons of confidentiality, with such redactions indicated by the symbol . In some cases, ComReg has presented information in an aggregated fashion in order to strike a balance between preserving the confidentiality of operator-specific information whilst enabling interested parties to respond in a meaningful way to the Consultation. Content Section Page 1. Introduction .................................................................................................. 12 What is WHQA? ........................................................................................................ 13 Previous Market Review and Subsequent Developments ......................................... 17 Previous Market Review ........................................................................................ 17 Subsequent Developments .................................................................................... 18 Legal Basis and Regulatory Framework ................................................................... 20 Current Review ......................................................................................................... 24 Information Sources Relied Upon ............................................................................. 24 Liaison with the Competition and Consumer Protection Commission ....................... 26 Consultation Process ................................................................................................ 27 Structure of this Consultation .................................................................................... 28 2. Executive Summary ..................................................................................... 30 Background to the Review ........................................................................................ 32 Retail Market Assessment ........................................................................................ 32 Main Retail Trends and Developments .................................................................. 32 Retail Market Definition .......................................................................................... 33 WHQA Market Definition and SMP Assessment ....................................................... 34 Definition of the WHQA Markets ............................................................................ 34 SMP Assessment in the Relevant WHQA Markets ................................................ 34 Competition Problems and Remedies ....................................................................... 36 Competition Problems in the LB TI WHQA ............................................................ 36 Remedies in the LB TI WHQA Market .................................................................... 37 Next Steps ................................................................................................................ 37 3. Retail Market Trends and Developments ..................................................... 38 Introduction ............................................................................................................... 38 Providers of Retail Leased Line services .................................................................. 39 Eircom .................................................................................................................... 43 BT .......................................................................................................................... 44 Vodafone ................................................................................................................ 45 Verizon ................................................................................................................... 45 Digiweb/Viatel and Airspeed .................................................................................. 46 Colt ......................................................................................................................... 47 Virgin Media ........................................................................................................... 47 enet ........................................................................................................................ 47 ESBT ...................................................................................................................... 48 Migration from Analogue and TDM (Traditional Interface (TI)) to Ethernet, xWDM and other advanced (Modern Interface (MI)) based LL services ...................................... 49 Demand for LL services from non-commercial (State) sector ................................... 52 Increasing take-up of wireless (P2P radio) Ethernet retail LLs .................................. 53 Growth in the take-up of higher bandwidth LLs ......................................................... 55 Tendency for retail LL to be purchased in a bundle with other services .................... 57 Increasing availability of fibre and wireless infrastructure ......................................... 58 Fibre Network deployment by SPs ............................................................................ 58 Alternative network rollout for retail LL access .......................................................... 59 Overall Preliminary Conclusion on Retail Trends and Developments ....................... 61 4. Retail Market Assessment ............................................................................ 63 Overview ................................................................................................................... 63 Introduction ............................................................................................................... 64 Initial considerations of relevance to the likely scope of the retail LL market(s) ........ 65 Are Business Broadband and/or Ethernet First Mile (‘EFM’) services effective substitutes for a retail LL? ...................................................................................... 65 Are LLs provided over P2P wireless media an effective substitute for wired LLs? . 77 Is dark fibre an effective substitute for a retail LL? ................................................. 83 Retail LL Product Market Assessment ...................................................................... 85 Identifying the focal retail LL product ...................................................................... 85 Factors affecting the responsiveness of end-users to changes in retail LL prices . 87 Retail Product Market Assessment ........................................................................ 96 Overall preliminary conclusion on likely retail LL product markets ....................... 113 Geographic Assessment of Retail LL markets ........................................................ 114 Overview .............................................................................................................. 114 Framework for assessing retail geographic markets ............................................ 115 Assessment of the Geographic Scope of the Relevant Retail Product Markets ... 116 Overall Preliminary Conclusion on Retail Market Assessment ................................ 121 5. Definition of the Relevant WHQA Markets ................................................. 123 Overview ................................................................................................................. 123 Regulatory Framework for the definition of Wholesale Markets .............................. 124 Relevant WHQA Product Market Assessment ........................................................ 126 Overview .............................................................................................................. 126 Treatment of self-supply ....................................................................................... 127 Identifying the Focal Product ................................................................................ 129 Product Market Assessment – MI WHQA LLs ..................................................... 133 Product Market Assessment – TI WHQA LLs ...................................................... 161 Assessment of the Geographic Scope of the Relevant WHQA Product Markets . 169 Overall Preliminary Conclusions on Definition of the WHQA Markets .................. 179 6. Competition Analysis and Assessment of SMP in the WHQA Markets ...... 181 Introduction ............................................................................................................