Guidance

Gigabit infrastructure subsidy guidance: wholesale open access network requirements

Updated 26 July 2024

1. Introduction

In this document, BDUK provides guidance to suppliers, implementing bodies and other stakeholders on the general and specific wholesale network access requirements that will apply to suppliers in direct and indirect receipt of Subsidy. This document should be read in conjunction with our other detailed guidance: in particular, reference should be made to the pricing rules for the access products.

These wholesale open access requirements have been explicitly designed to meet Subsidy Control requirements under UK law and are legally separate to the requirements specified under the UK regulatory framework for communications.

For the Gigabit Infrastructure Subsidy (GIS) scheme, the intention is for BDUK to direct resources for qualifying projects. BDUK’s National Competence Centre (NCC) for Subsidy Control will operate in a functionally separate capacity making its assessments separately through our internal assurance process. Projects seeking approval by the NCC will need to demonstrate that they have incorporated the full set of general and specific wholesale network access conditions in supplier contracts as they are applicable to the proposed network deployments.

2. General open access conditions

A key principle of the GIS scheme is that networks built utilising subsidy should offer effective wholesale access and are pro competitive. This is to prevent the beneficiary supplier from exploiting its monopoly position through anti­competitive practices in areas that are identified with market failure. To meet this requirement all contracted suppliers must offer open access to the subsidised network under fair and non­discriminatory conditions to all operators who request it for any reasonable purpose (e.g. mobile backhaul, private circuits, CCTV etc).

These open access conditions will apply to new infrastructure and existing infrastructure in the intervention area that is used in the deployment of the solution. Suppliers are also required to provide a passive network interconnect to any new or existing infrastructure built outside the intervention area to the extent such infrastructure is used to deliver services in the intervention area. In practical terms, this will mean the Supplier shall provide access between the nearest network access points outside the intervention area which is nearest to the infrastructure in the intervention area (e.g. the nearest footway box in the case of duct access).

The access conditions must apply for at least 7 years or indefinitely in the case of new passive infrastructure assets. If in the course of that period the supplier and/or infrastructure is sold, the wholesale access obligation must be transferred to the new owner of the supplier and/or of the infrastructure.

In case the supplier also provides its own retail services, a reference offer for wholesale services must be made available to competitors at least 6 months before starting the provision of retail services. In addition, the network operator must undertake accounting separation of wholesale and retail services.

The supplier is required to publish full details for the wholesale access it offers on Subsidised infrastructure. The supplier is further required to notify Ofcom/BDUK of the charges and terms and conditions applying to any specific wholesale access that it provides on the State subsidised network, where that access differs to the access offered under ex ante regulation. Furthermore, the supplier must notify anyone using that specific product of changes in the charges or terms and conditions.

Use of existing regulated products Ofcom has taken measures to derestrict PIA (Passive Infrastructure Access), DPA (Duct and Pole Access) and also use of Dark Fibre (both inter exchange (DFX) and exchange to consumer (DF1AL and DF2AL)) on those suppliers with Significant Market Power. This should allow suppliers to offer the fullest range of broadband services together with other services over existing regulated infrastructure, and these derestricted products are encouraged to be adopted wherever possible.

It is accepted that the supplier’s wholesale products may be subject to some restriction in consuming a regulated product to deliver new infrastructure e.g. its usage is restricted by the terms imposed by regulation. However, infrastructure that did not depend on the use of regulation would generally be expected to be offered on an unrestricted basis, as per the paragraphs above though subject to paragraph 3.3 below).

3. Specific network access conditions

The GIS scheme includes a list of specific products that, if used in the deployment of the gigabit-capable solution, must be made available from the point of network deployment. A table from the Detailed overview of the GIS scheme outlining the access requirements for each product is attached as Annex A.

New Infrastructure: BDUK recognise that it may not be possible to forecast future uses of the infrastructure and that the use of subsidy should promote future competition where possible aligned with established principles. BDUK therefore proposed that suppliers are allowed to build efficient networks that, while they may not initially provide capacity for up to 3 operators, are extensible (see Annex A) and subject to certain constraints relating to technical and legal feasibility. In certain circumstances the provision of extra capacity can be deferred until a need is identified by an access seeker in the future. The incremental cost of providing the additional capacity would not be directly charged to the access seeker, but would be met by the supplier. Any changes in the wholesale access market should be reflected in this scheme, and third-party operators should have access to other wholesale access products if they are able to demonstrate “reasonable demand” for such additional access.

Existing Infrastructure: Where existing infrastructure is being used to support the gigabit-capable infrastructure, those assets should support requests for access:

(a) where technically feasible (e.g. given reasonable loading factors and existing capacity); and

(b) legally feasible (e.g. where conditions placed on access to existing infrastructure or other commercial terms imposed by an infrastructure owner would not prevent the Wholesale Access Requirements being met),

(c) except where Ofcom does not oblige the specific form of access to be provided on the infrastructure owner’s existing infrastructure and where such access is at the sole discretion of the infrastructure owner

Regulatory remedies: Additionally, BDUK will require suppliers to provide such additional forms of wholesale access as mandated on suppliers with SMP by Ofcom as a regulatory remedy in its periodic market reviews where such remedies place a greater obligation than the wholesale access conditions set out in Annex A. Access would be required on new infrastructure and existing infrastructure in the intervention area used in the deployment of the solution.

4. Requests for new forms of access

The supplier is also required to meet all requests for new forms of wholesale network access made by an operator demonstrating reasonable demand for a product that is not already available, during the seven year period of Subsidy contract (or indefinitely in the case of new physical infrastructure). New forms of wholesale network access include requests for modifications to existing network access and requests for completely new forms of network access. This requirement applies to existing and new infrastructure used in the intervention area.

In assessing requests for new forms of network access, access seekers would need to demonstrate to BDUK that their demand meets the three requirements of the “reasonable demand” test:

(i) the access seeker must provide a coherent business plan (based on a product price that is consistent with the pricing principles set out in Gigabit Infrastructure Subsidy Guidance: Wholesale Access and Pricing) which justifies the development of the product on the subsidised network;

(ii) no comparable access product is already offered in the same geographic area by another operator at equivalent prices to those of more densely populated areas; and

(iii) the introduction of the new wholesale access products should deliver sustainable and effective competition in the downstream market(s).

Business Plan: A credible business plan would be supported with documents like bank loan agreements and a detailed calendar deployment plan.

BDUK/ February 2022

5. Annex A: ­ Access Requirements under GIS scheme

Infrastructure Component	Access Requirements
Ducts	• Where new duct[footnote 1] infrastructure is required as part of a network build, this must be configured to support at least three competing infrastructure providers and designed to support alternative technologies (e.g. sub-duct or cabling) with similar sizes and/or physical characteristics. • Access must be provided to all Points of Flexibility (PoF) including originating and terminating nodes, joint nodes, junction nodes, aggregation nodes, splitter nodes, distribution nodes, chambers, footway boxes, and equivalents irrespective of the nomenclature used. • The supplier is not obliged to provide for new ducts where this is not a requirement for their network build. For example, in FTTP networks the laying of direct buried fibre in soft verges or uncultivated land will be acceptable provided that the wholesale access requirement is met by the dark fibre for three competing infrastructure providers. However, in this case, the UK expects that sub-duct installation will be required under a public highway by the Highway Authority.
Poles	• New pole infrastructure[footnote 2] must be configured to support at least three competing infrastructure providers with suspended duct or dark fibre infrastructure including joint, junction and distribution nodes. Where active equipment is installed on poles then refer to mast section below for access requirements.
Fibre	• Access must be made available at appropriate Points of Flexibility (PoF) in the network: • at the telephone exchange or Point of Presence (PoP)’s Optical Distribution Frame (ODF) or equivalent • at cabinets or similar local distribution points • all relevant PoFs including originating and terminating nodes, junction nodes, aggregation nodes, splitter nodes, distribution nodes, chambers, footway boxes, and equivalents irrespective of the nomenclature used • Access must be provided for at least three competing infrastructure providers via: • dark fibre[footnote 3] • space for active and optical equipment (of a size and type similar to the supplier’s equipment) • existing power supplies (metered or unmetered, and equivalent to the supplier’s access in all other respects)
Cabinets	• Access to cabinet space and existing power supplies must be provided for at least three competing infrastructure providers upon request. • Extra-large cabinets to accommodate potential competitors do not need to be deployed from the outset; however, designs that would comply with local planning regulations and reasonable landowner conditions should be prepared for new cabinets or upgrades to be deployed in a timely manner if and when access is reasonably requested[footnote 4]. • Such access will be subject to cabinet space being able to be provided legally and in accordance with local authority planning regulations.
Masts	• Access to mast space, antenna apertures or for other active equipment and existing power supplies must be provided for at least three competing infrastructure providers upon request. • Extra-large masts to accommodate potential competitors do not need to be deployed from the outset. However, designs that would comply with local planning regulations and reasonable landowner conditions should be prepared for new masts or upgrades to be deployed in a timely manner if and when access is reasonably requested.[footnote 5] • Such access will be subject to masts space being able to be provided legally and in accordance with local authority planning regulations, and to it being legally, commercially and technically possible.
Antennae	• Access to shared antenna systems (where multiple operators feed radio signals to the same antennas) should be provided or supported where technically feasible, and in particular where planning rules could impede other forms of mast capacity expansion.
Active Bit-Stream Equipment	• Bit-stream access for broadband and associated backhaul must be provided by infrastructure providers at appropriate Points of Interconnection such as telephone exchanges, PoPs or cabinets e.g for Virtual Unbundled Local Access (VULA) or equivalent. • New subsidised network infrastructure must either be dimensioned to meet the likely capacity requirements of competing providers, or be capable of being expanded to meet it upon demand. Existing infrastructure must support the capacity requirements of competing providers where technically feasible. • Bit-stream access must be provided over standardised or fully defined technical interfaces. • Accommodation for access seekers’ necessary interconnection equipment must be provided including access to suitable power supplies.
Existing Infrastructure	Infrastructure access requirements as set out above equally apply to existing infrastructure in the intervention areas. Existing assets should support all forms of access as set out above: a) where technically feasible (e.g. given reasonable loading factors and existing capacity); and b) legally feasible (e.g. where conditions placed on access to existing infrastructure or other commercial terms imposed by an infrastructure owner would not prevent the Wholesale Access Requirements being met). c) except where Ofcom does not oblige the specific form of access to be provided on the infrastructure owner’s existing infrastructure and where such access is at the sole discretion of the infrastructure owner.

1. New Duct Infrastructure is defined as “subsidised physical infrastructure located underground with an individual length of at least 1.0km and deployment costs of GBP 50,000 or greater”). ↩

2. New Pole Infrastructure (“subsidised physical infrastructure located overhead where the poles will be deployed over a distance of 1.0km and have deployment costs of GBP 50,000 or greater”). ↩

3. Dark fibre access is required to all network elements, excepting only the final drops from the Points of Points of Flexibility (PoFs) nearest to end user premises on the condition that individual access to those premises is provided via ODFs, VULA or equivalent. Furthermore, in any cases where final drops or the distances to the last PoFs are unreasonably long, considering geography and premise density, then dark fibre access for three competing infrastructure providers would also be required for those final drops together with reasonable access to additional PoFs nearer to the premises. ↩

4. The provision of extra capacity is deferred until a need is identified by an access seeker in the future. The incremental cost of providing the additional capacity would not be directly charged to the access seeker. ↩

5. The provision of extra capacity is deferred until a need is identified by an access seeker in the future. The incremental cost of providing the additional capacity would not be directly charged to the access seeker. ↩