Spain’s fibre market gets boost from Orange-Vodafone shared network plans

In recent years Spain has addressed some legal issues which had restricted access to fibre infrastructure. The General State Administration now obliges property owners to allow access to fibre operators seeking to install cabling, while operators are also entitled to occupy private property when it is necessary to install the local loop as long as there are no other economically viable alternatives. In addition, local administrations are obliged to grant the necessary urban development licences which permits work to be carried out. In conjunction with this, several municipalities have set up systems by which operators must inform others of works scheduled to be undertaken in public areas, thus coordinating works to reduce costs to themselves and disturbance to denizens.

For its part, the regulator has promoted a GPON-based access network for Spain, as early as 2009 estimating that around 8.5 million households would have FttH by 2023. Most accesses in the main cities would be provided by Movistar and alternative operators, to which Movistar must provide duct access at the same price it charges its own FttH operation. Perhaps optimistically, smaller towns were expected to be served by Movistar and at least one alternative operator, despite the financial and RoI impediments for competing operators to make a viable business in towns or regions with relatively few people.

Crucially, the EC in 2009 overturned the regulator’s ruling that Telefónica did not have to provide wholesale access to its VDSL and fibre platforms providing data rates above 30Mb/s. The regulator also no longer differentiates remedies geographically. The regulator set pricing for Movistar’s duct access based on an international comparison with operators such as Orange and Portugal Telecom, where similar systems were already in place.

Despite the encouraging regulatory changes, overall FttH deployments in Spain have thus far been hampered by a continuing lack of investment by most network operators. This has meant that the focus for FttH has been with regional projects, such as the Asturcón network deployed to about a third of residents in the Asturias region, the 22@Barcelona project, Madrid’s €4 billion Telecommunications Infrastructure Master Plan, and the efforts of the regional development consortium Sociedad Promotora de Telecomunicaciones de Extremadura.

Among operators, Movistar has the main player thus far, though recent moves by Vodafone and Orange are encouraging. Orange trialled FttH in 2010, and has now teamed up with Vodafone to invest up to €1 billion on a joint fibre network covering 50 of the largest cities. The operators’ complementary footprints will provide each of them access to the whole, while co-investing third parties will also be able to share the infrastructure. If all goes to plan, the network should reach six million residences by 2017.

Henry Lancaster
Senior Analyst

For more information see the updated report Spain – Broadband Market Insights, Statistics and Forecasts

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