DT called on to open up planned fibre-optic network

22 Nov 2005

The President of Germany’s Federal Network Agency (FNA), Matthias Kurth, has called on Deutsche Telekom (DT) to voluntarily open up its planned fibre-optic network. In an article written for German newspaper Frankfurter Allgemeine Zeitung, Kurth argues that sharing the new infrastructure will ultimately benefit the incumbent telco. ‘A network that has high start-up costs but steady long-term investment costs becomes more valuable and more profitable with each additional user and customer added,’ he wrote. Germany’s incoming coalition government caused controversy earlier this month by stating it would exempt DT’s high speed network from regulation at the telco’s request. The European Commission challenged the coalition’s assertion that ‘new markets created by such investments (as DT’s) should be protected from regulatory intervention for a certain period.’ The Commission observed that simply deploying new technology does not create a new market. Kurth claims that DT will now only be able to prevent a veto from Brussels if it can prove ‘that a truly new market creating new high quality products is planned.’ The FNA has proposed to wait until the network has been completed and then conduct a study to see whether regulation is necessary.

DT’s fibre-optic rollout is designed to provide data download rates of up to 50mbps and a range of multimedia services including high-definition television to Germany’s 50 largest cities by mid-2007. The telco says it will cost EUR3 billion to set up the network.

Germany, Deutsche Telekom (DT)