It seems I'm talking about regulation a lot these days, but if you think about it, it's not all that surprising: emerging technological market trends don't allow regulator, analysts or pundits to draw on past mechanisms to structure future market development, hence the chaotic state of NGA regulation.
A couple of weeks ago, a last-minute provisio voted in the French Law for the Modernisation of the Economy generated a telecom blogger uproar. Effectively, French cable will not be subject to all of the constraints imposed to telcos when it comes to NGAN deployment.
The core aspect of this exception is that cable will not be required to ask for any authorisation from building owners if they upgrade their coax in-building network to fiber. Compared to the situation of telcos who have to enter lengthy processes whenever they want to connect people inside a building, it's a clear advantage. On the other hand, cable is already there and obtained these authorisations 15 years ago, so I can sort of see where this comes from. Still, competitive authorities, consumer associations and telcos protest it's unfair.
So if Numéricable is already present in a building using coax, the likelihood that another service provider will get authorisations to run a parallel fiber in-building network are close to nothing. Think about it: customers already have cable plugs and ducts running all around their flats, they're not going to vote for yet another additional network to be rolled-out in their homes. And Orange, Free and Neuf being in the FTTH business, they're not using coax for the vertical...
Furthermore, it's unclear whether Numéricable will be obligated to share their vertical network even if they do upgrade to fiber. Again, the law seems to apply to what's happening now, not to what happened ten years ago. The impacts could be non-negligeable in ensuring a place in the sun for cable even though it only has about 5% of the broadband market today.
More generally though, this got me wondering about the cable exception and the definition of the relevant markets. Historically, cable has always been a mandated monopoly in France (and elsewhere) through the principle of concessions. But as cable moved beyond TV Services and telcos moves towards TV Services, the difference for the customer between the two is blurring to the point that only the brand images are differentiated.
I understand that historically, as a broadcaster, cable was under the jurisdiction of TV regulatory authorities while telcos were under the jurisdiction of telecom regulatory authorities, but this doesn't seem to me to make much sense anymore, especially with the advent of Next Generation Access Networks. Docsis 3.0 cable is a serious contender to FTTH from a technology point of view, and the services provided are, by and large, the same. So why are they subject to different regulatory regimes?
I'm hoping that one of the things that the fiberevolution will prompt is a redefinition of the relevant markets that focus on which services are delivered to the customer rather than on which network they are delivered on. It will certainly open a big can of worms, because it's not just about cable and fiber with LTE and Wimax down the road, but I think it's increasingly necessary...
