The European institutions are close to finalise the new Electronic Communications Code, that will prepare Europe for the era of 5G by promoting investment, competition and development of new services for the benefits of society and industry. Boosting investment is necessary to ensure that the EU is able to meet the ever-growing demand for gigabit connectivity, which is a vital part of the digital revolution.
The new European framework sets a specific regulatory regime for wholesale-only operators, that is to say telecom operators investing and focussing resources into ultra-broadband networks, while exclusively providing wholesale connectivity to any access seeker. Incentivizing such networks is part of the European strategy to encourage investments in very-high capacity networks. Such network operators are unlikely to discriminate against and amongst access seekers since, in the absence of a retail arm, their only business consists in providing wholesale access services. The specific regime provided by the new Code is necessary to create legal certainty for long-term investors, since the roll-out of ultra-broadband network from scratch involves a long investments return. In addition, incentivizing wholesale-only networks could attract investors who are less interested in vertically-integrated operators, increasing the total level of investment in telecoms sector.
Therefore, while wholesale-only model was originally created as just the solution of local authorities to the lack of ultra-broadband connectivity for their communities, now it could become, thanks to the endorsement by the new Code, a change of paradigm for a market traditionally dominated by vertically-integrated operators.
What may be the impact of such new model in a market requiring increasing investments in ultra-broadband networks in light of the emerging 5G economy and society? A recent study of WIK suggests that such kind of wholesale-only networks may result in multiple retail providers offering mainly stand-alone services, whereas multi-play bundles and less service providers are the norm in market dominated by vertically-integrated operators. In other words, will competition created by wholesale-only networks lower the barrier for the entry of OTT, 5G mobile and IoT services?
The wholesale-only model in practice - presentation of national cases
Welcome and introductory remarks The case of Ireland and the combination of energy utility and telcos The case of Iceland The wholesale-only in Italy: from niche to national players the case of French municipalities FTTH in Nordic metropolitan areas
the path towards 5G