EU wants utilities to share ducts to cut broadband cable costs

Thu Feb 7, 2013 8:50am EST

* EU wants water, power suppliers to share with telecoms

* Digging trenches represents as much as 80 pct of cost By Claire Davenport and Francesco Guarascio BRUSSELS, Feb 7 (Reuters) - The European Commission wants water, electricity and gas companies to share their underground ducts with telecoms firms to cut the cost of laying fibre cables for faster broadband, a Commission paper seen by Reuters said.

The Commission is trying to help companies bring down the cost of building fibre-based networks because the continent's copper-based networks cannot sustain the rate at which Internet use - especially mobile-based use - is expanding.

Mobile data usage is projected to grow three times faster than computer-based traffic.

Analysts estimate duct-sharing can save companies 30 to 50 percent on laying cables, which the Commission says represents up to 80 percent of costs ranging between 20 and 100 pounds ($30-$160) a metre (yard) in Britain, for example.

Europe's telecoms companies have also been slow to lay cables that have a 30-40 year payback time.

Draft regulation says network operators, including ports, airports and waste services, would be obliged to give broadband companies access to their ducts "under fair terms and conditions, including price".

"This regulation aims at reducing the costs of deployment of physical infrastructure suitable for high-speed electronic communications networks," the proposal from from the EU's Digital Agenda Commissioner Neelie Kroes said.

The Commission has taken inspiration from Paris where companies such as France Telecom uses the city's sewers at a cut price to lay fibre.

Older copper networks are owned by Europe's largest telecoms companies such as France Telecom and Deutsche Telekom which inherited the lines when they were privatised in the 1990s. Firms such as Iliad pay rent to use those cables.

The newer firms say they would welcome the move if it is adopted, a Brussels-based lobby representing them said.

"As alternative operators are the leading investors in open fibre networks, we strongly support the Commission's ambitious initiative," Erzsebet Fitori, director of regulatory affairs at the European Competitive Telecommunications Association, said.

A lobby group representing Europe's biggest telecoms companies declined to comment.

These companies have not been seeking more ducts to lay fibre but have been campaigning for fewer regulatory barriers to buying smaller rivals to slim down an overcrowded market.

While Neelie Kroes is in favour of more consolidation, the EU's competition chief Joaquin Almunia has come down hard on companies' efforts to merge.

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