Local Loop Unbundling
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Transcript of Local Loop Unbundling
Local Loop Unbundling
PRESENTATION TO THE PORTFOLIO COMMITTEE 6th JUNE 2007
Agenda Introduction What is Local Loop? What is Local Loop Unbundling? What does it Achieve? Recommendations
Introduction LLU report is a response to the mandate by
the Minister for the Local Loop Unbundling Committee (LLUC) to recommend how Telkom’s last mile network should be unbundled
The report has been finalised and was presented to the Minister on the 25th May 2007.
What is Local Loop? The local loop is
that portion of the telecommunication network that is situated between the end of subscriber’s telephone connection and the MDF (Main Distribution Frame), where all the user lines come together before being connected to the telephone exchange.
The physical wire connection between the customers and owned by the telecommunication company
Local Loop Diagrammatically
TDM Network
Laptop
Customers premises equipment
MDF
Modem
Splitter
DP SDC Splitter
ATM Network
DSLAM
Voice
Data
Voice(Low frequency)
Data(High frequency)
The incumbent premises equipment
Local Loop(The last mile)
DP – Distribution PanelSDC – Street Distribution CabinetMDF – Main Distribution FrameDSLAM – Digital Subscriber Line Access MultiplexerTDM – Time Division MultiplexerATM – Asynchronous Transfer Mode
What is Local Loop Unbundling? Is a regulatory process of allowing multiple
locally- and national telecommunications operators to make use of connections from the telephone exchange central office to the customer’s premises. (Wikipedia definition).
Is a process that covers a series of regulatory offers that is aimed at fairly providing newly entrant operators with access to the local loop in a competitive environment.
What does it achieve? Lower the prices paid by customers Increase quantity and quality of services Increase the number of available business
opportunities Increase innovation Provide affordable access to national
telecommunication infrastructure for ICT growth and participation
Achievement - Customers Perspective
Full unbundling Line sharing Bitstream access – wholesale access
Bitstream with collocation Bitstream without collocation Resale of local traffic services Resale of access services
Sub-loop unbundling
Slide 1/7
Full unbundling The entire copper loop is assigned to the leasing
operator
MDF
Laptop
Customers premises
equipment
DSL ModemSplitter
New entrants switch
DSLAM
Incumbent’s switch
Tie cable
PSTN
PSTN – Public Switched Telephone Network
Slide 2/7
Line sharing This takes place when the incumbent retains use
of the loop for its baseband, PSTN service, but unbundles the higher frequency part of the spectrum for use by another DSL operator.
MDF
Laptop
Customers premises
equipment
DSL ModemSplitter
New entrants DSLAM
Incumbent’s switch
broadband
PSTN
PSTN – Public Switched Telephone Network
DataNetwork
Splitter
Voice
Slide 3/7
Bitstream access – wholesale access the incumbents are supposed to provide a whole
data service for ISPs to service the fast growing Internet market.
Bitstream access topology is automatically set when the process of LLU is done while the incumbent has rolled the broadband network.
Slide 4/7
Bitstream access – wholesale access
MDF
Laptop
Customers premises
equipment
DSL ModemSplitter
Incumbent router
Incumbent’s switch
PSTN
PSTN – Public Switched Telephone Network
ISP RouterInternet
DSLAMSplitter
Slide 5/7
Bitstream access – wholesale access Bitstream with collocation
access from the incumbent’s premises - collocation included. Bitstream without collocation
access at a point of interconnection outside the incumbent’s premises - collocation is excluded.
Resale of local traffic services access where by the incumbent sells traffic services to new
entrants at a wholesale price for the new entrants to resale at a retail price.
Resale of access services access where by the incumbent sells access services to new
entrants at a again a wholesale price.
Slide 6/7
For the case of South Africa, Telkom is the incumbent operator in the country. There are three issues that may need to be considered with respect to Telkom in restructuring for the benefits of LLU process. Telkom is kept away from LLU. Leave the local loop with Telkom and regulate its
use. Telkom share the local loop with other players.
Incumbent wishes to prevent or delay for as long as possible for arrival of LLU and DSL within its own or anyone else’s product ranges.
Incumbent acceptance of the technology, though with a determination that it will dominate and control the market for DSL based broadband products. Incumbents will resist to the maximum possible not the
technology but competition and unbundling. Incumbent recognizes the new market
view competition as a means of growing the market to the common benefit, and co-operate in encouraging it.
Incumbent has deployed ADSL services to residential and business customers
New entrant can Install cables, ducts to an exchange building Has right to obtain information on where to place
cables/ducts and technical standards for connection All lines must be made available for leasing to all new
entrants Lines must meet any technical specifications
imposed by ICASA Charges for subscriber lines must be published
ICASA can issue orders on charging principles and calculation of costs
Slide 1/3
Provision of service can be restricted or interrupted for safety or public order purposes
Must be a minimum period of notice for technical changes, terminating contract to other operators and users
Areas of controversy Price – different prices for residential and business
customers Timescale – uncertainty about whether the loop can
be obtained makes it very difficult for the new entrants to market services on the basis of unbundled loops
Capacity – uncertainty about whether an existing line or a new line can obtained
Slide 2/3
Conclusion The report covers issues on
Technical aspects of LLU Legal/Regulation settings Economics of LLU Recommendations Policy concerns on implementation period by
regulators
Recommendations regarding policy decisions and directions Three unbundling structures be implemented
to allow innovation and through the competitive environment
Requirement for immediate implementation and to be in the advance stage at the 2011
Immediate finalisation of the guidelines by the regulator
THANK YOU