BNetzA approves bitstream charges designed to encourage investment

19 May 2008

German regulator the Federal Network Agency (BNetzA) has announced the approved rates that incumbent telco Deutsche Telekom (DT) may charge for wholesale IP bitstream access to its last mile connections; by an earlier ruling, DT is already obliged to grant competitors unbundled to-the-home access. A basic rate of EUR19.05 (USD29.68) has been approved for ‘standalone’ bitstream access where the retail customer does not require a separate DT telephone connection in addition to their DSL line. If the customer wants to keep a traditional telephone connection in addition to the DSL line, their ISP will have to pay an additional EUR8.55 to DT for the IP bitstream.

BNetzA president Matthias Kurth explained, ‘The approved rates for the IP bitstream access are consistent with the price level of the currently available wholesale services, in particular for subscriber lines…The costs for using broadband service based upon [competitors’] own infrastructure, making use…of Deutsche Telekom’s last mile are lower than those [for] the standalone variant. [Therefore] the positive progress so far of the infrastructure of individual competitors will not be jeopardised. At the same time, the costs for a reseller, who up to now has had no recourse to an infrastructure, are higher than those for an IP bitstream user. The approved rates thus provide incentives for investment…in infrastructure as aimed for by regulatory orders. The approved bitstream rates are therefore a fair compromise in a difficult and highly controversial situation.’

Germany, Deutsche Telekom (DT)