Development of Broadband markets

1. Development of Broadband markets Communications Regulatory authority of Lithuania Electronic communications department www.rrt.lt Disclaimer: The views, opinions or positions expressed in this presentation are of my own and do not necessarily reflect the views, opinions or positions of Communications Regulatory authority of Lithuania Broadband markets LT

2. Outline • Broadband markets in Lithuania (statistics) • New EU initiatives (EC rec.; Regulation) • Broadband promotion. Lithuanian approach: • EU context; • Regulatory impact on NGA (main drivers) Broadband markets LT

3. I. BroadbandmarketdevelopmentsinLithuania Broadband markets LT

4. Market maturity? Broadband markets LT

5. Technologies: towardsfibre Broadband markets LT

6. Technologies in EU: different story DSL (EU) DSL (LT) Broadband markets LT

7. Increasingspeed Broadband markets LT

8. Highfibrepenetration Broadband markets LT

9. NGA (>30 Mbps) take up Broadband markets LT

10. II. New EU initiatives Draft EC recommendationonnon-discriminationandcosting EC proposalforRegulationoncostsavingmeasures to promote BB investment Broadband markets LT

11. I. Draft EC recommendation on non-discrimination and costing (latest CoCom draft 2013-05-29) • Non – discrimination • EoIvs. EoO • Technicalreplicability • KPIs + auditing • SLGs • Costing • BU-LRIC • Reusablevs. Non-reusablecivileng. assets • Priceband (8-10 EUR for copper ULL) • Trade-off(EoI + tech./econ. repl. + priceconstraints) • Implementation – 2016-12-31 Broadband markets LT

12. Copper access in EU Copper ULL prices are declining… …but too slow to have significant impact on NGA investments Broadband markets LT

13. II. Regulation on cost saving measures to promote BB investment (2013-03-27) • Objective - to reduce the cost and enhance the efficiency of deploying high-speed electronic communications infrastructure • Access to existing physical infrastructure: • all infrastructure to be shared • NRAs to solve disputes • Transparency: • Single information point (location, size, owner) +12m. • Electronic means (public+6m.; private+12m) • in-site surveys • Coordination of civil works • Permit granting • In-building equipment Broadband markets LT

14. II. Broadband promotion. Lithuanian approach Only with regard to the powers of NRA Broadband markets LT

15. Broadband usage in EU • Super-fast BB (>100 Mbps)islagging; • Fixed BB usage (all speeds) in EU is increasing, but slowly • Mobile BB is increasing • Still significant differences persist among the countries Broadband markets LT

16. BB: Lithuania in EU context (1) Lithuanian case: Wholesale access products are not popular ULL: only ~ 500 lines unbundled (0,09 %) WBBA: only ~ 1,300 wholesale lines used (0,33 %) Alternative operators tend to use their own access infrastructure.

17. BB: Lithuania in EU context (2) 51% of broadband lines are based on alternative infrastructure Source: 15th Implementation report, European Commission, 2009 Alternative providers (and therefore – their end-users) benefit from being independent from incumbent. Broadband markets LT

18. BB in Lithuania: infrastructure competition Share of alternative operators’ investments into FTTx declining. Since 2010 m. ~70% of new FTTx deployment is done by TEO (incumbent) 60% of total FTTx infrastructure is still owned by alternative providers (2011 QIV) Incumbent‘s newFTTx lines TotalnewFTTx lines AlternativenewFTTx lines Ductrentalprice 1km = 30 EUR/month Source: RRT FTTx is being provided by 57 undertakings in Lithuania. Broadband markets LT

19. Access to the ducts – essential for FTTx investment Average duct renting rate is approx. 500 km per year Ducts, km Change, km The change of leading broadband technology from xDSLtoFTTxoccured in 2009 (quite early) Source: RRT Access to the physical infrastructure was and still is the essential enabler of alternative infrastructure roll-out. Broadband markets LT

20. Residential Internet connections Demand for high speed connections is steadily increasing Broadband markets LT

21. Questions… Thank you! Giedrius Pūras _________________________________________________________________ Acting head of Price control and Statistics division Electronic communications department Communications regulatory authority of Lithuania Tel. +370-698-56100 e-mail: gpuras@rrt.lt Broadband markets LT

22. BB QoS measurements (1) • Providers must state the minimum speed in contracts (mobile BB – usually 0 kbps) • Dedicated speed test website: www.matuok.lt • Similar to SpedTest.net • No single Exchange point in LT, therefore all providers were asked to allow connecting the RRT server at certain nodes; • Speed test reports can be archived or saved to PC Broadband markets LT

23. Wireless BB quality measurements 3. Wirelessbroadband speed measurements and publication of results: • Basedonpartnership. Currently: 3 MNOs + WiMAxoperator; • Commercially available (provided by operator) modems are used; • RRT developedsoftwareisused; • Locations: Post offices (oneweek testing incertainlocation); • Yearly report published; • Interactive and up to date measurement data available in dedicated website: http://epaslaugos.rrt.lt/matavimai/ • Open data for third parties’ applications made available in 2013: http://epaslaugos.rrt.lt/WebServices/ Broadband markets LT

24. Termination rates regulation Pure LRIC results to be applied from 2013 (EC. Rec.) Broadband markets LT

25. Wirelessbroadband measurement locations (2012) Broadband markets LT