Implementation of BSA and sub-loops of raw copper in the LRAIC model. Data Request to the Parties

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1 Implementation of BSA and sub-loops of raw copper in the LRAIC model Data Request to the Parties Europe Economics Chancery House Chancery Lane London WC2A 1QU Tel: (+44) (0) Fax: (+44) (0) May 2006

2 TABLE OF CONTENTS 1 INTRODUCTION AND PURPOSE OF THIS DATA REQUEST DEMAND BITSTREAM ACCESS SUB-LOOPS

3 1 INTRODUCTION AND PURPOSE OF THIS DATA REQUEST 1.1 Europe Economics is currently assisting NITA in making enhancements to the LRAIC model in order to enable the model to cater for the following additional products: 1 Unbundled sub-loops (national average) 2 Bitstream Access at the DSLAM (national average) 3 Bitstream Access at the ATM node location (national average) 1.2 In order to facilitate this work, Europe Economics would very much appreciate the assistance of both TDC and the Working Group in providing us with certain data. 1.3 The purpose of this data request is to describe the data requirements as we currently understand them. We will then aim to meet with both TDC and the Working Group on 22 and 23 May in order to clarify any issues relating to this request and, as necessary, agreeing to modifications to the data requested. 1

4 2 DEMAND Question 2.1 Demand (1) Please fill in the table below. The aim of this table is to guide the model in the anticipated developments in broadband delivered over TDC s local network infrastructure. Thus, for example we have included BSA including ATM network for completeness (and to allow us to review the anticipated take up of other BAS wholesale products compared to the whole BSA market) and we have separately broken out wholesale BSA products using ATM-based DSLAMs form those using Ethernet-based DSLAMs. As the deployment of Ethernet-based DSLAMs is still embryonic, operators will, unfortunately have to form their own assumptions on their likely location, and thus availability. Having said that, a starting assumption could perhaps be that Layer 3 router interconnect is more likely to be available at LE locations, Layer 2 switch interconnect at ASM locations, and raw DSLAM interconnect at Street Cabinets. Note that we are not asking for LLU information as that is already contained within the existing version of the model. Table 2.1.: Demand data # connections 31/12/ /12/ /12/ /12/2008 Retail Normal broadband (up to 2 Mbit/s) High speed broadband (up to 8 Mbit/s) Very high speed broadband (above 8 Mbit/s) Wholesale - ATM BSA at the DSLAM BSA at the ATM node BSA including ATM network Wholesale - Ethernet BSA at the DSLAM BSA at the Layer 2 switch BSA at the Layer 3 router 2

5 Question 2.2 Demand (2) How do you expect the above to vary across the geo-types as currently defined in the model? Please note that we are anticipating qualitative rather than quantitative answers to this question. 3

6 3 BITSTREAM ACCESS The modelling of the Bitstream Access products will require us to modify the model in order to be able to cost additional network elements to cater for the DSLAM, the DSLAM to ATM node location link, and, potentially, the ATM node. During our previous discussions with both TDC and the Working Group, we were made aware of the following issues that needed to be addressed: 1 The latest generation DSLAMs have an Ethernet interface, enabling other operators to connect to them via a layer 2 Ethernet switch in contrast to the current connection via an ATM node. 2 Although TDC do intend to deploy Ethernet-based DSLAMs, they still have predominantly ATM-based ones within the network. 3 As the usage of broadband services develops within Denmark, there is likely to be an increased need for Quality of Service control, for example, to allow for separation and quality control of different channels (e.g., voice, IPTV, and conventional surfing/ ing). 4 Higher speed broadband connectivity might require different components (for example, DSLAM line cards) than slower speed connections in addition to, potentially, greater usage of common components. 5 TDC stated that it is unlikely to be practical (from a cost effectiveness point of view) for an OAO to connect directly to an ATM-based DSLAM. Question 3.1 DSLAM functional blocks (a) What are the functional blocks of the DSLAM with regard to: 3.1.a.1. how the DSLAM is specified and purchased; and 3.1.a.2. how the DSLAM performs (numbers of customer connections, differing connection speeds, quality of Service controls, multiple ISP breakout etc)? (b) How would your answers differ for the latest generation DSLAMs compared to the existing ATM-based ones? (c) Is it now the case that all new network build would be based on Ethernet-based DSLAMs? If so, how long has this been the case? If not, what considerations would influence the decision? Question 3.2 DSLAM component prices (a) Can you please provide us with indicative price information for the range of DSLAMs likely to be purchased today? Please disaggregate your answer as far as is practical to separate out, for example, common parts (chassis, backplane, management cards etc) from per customer (or group of customer) parts (multi-port line cards etc). Where 4

7 there are different types of equipment for different sizes, then please include this information as well. (b) Where relevant, please indicate the performance level of each item priced. We would see this as particularly relevant to the line cards (e.g. up to 2Mbps ADSL capable, up to 8Mbps ADSL capable, up to 22Mbps ADSL capable, SDSL capable, VDSL capable). (c) Please include any expected supplier discounts in the prices you provide us and also indicate the likely volumes that the prices would be relevant for. (d) Please provide your estimate of annual price changes over the next five years. (e) If there are any annual maintenance charges payable to the equipment providers (for example to cover software upgrades), please provide details. Question 3.3 DSLAM installation/commissioning costs Please provide us with information to allow us to estimate the installation/commissioning costs. This could, for example, either be in terms of a percentage uplift on the capital cost or in terms of the number of person-hours (presumably again split into time to install/commission the common parts and the customer specific parts). Question 3.4 DSLAM asset lives Please provide us with your estimate of the asset lives of the equipment indicated above distinguishing between components, as necessary. If these lives differ from your internal accounting asset lives, please provide details of the differences and explain why. Question 3.5 Bitstream connection functional blocks (a) Please describe how an OAO would connect to the DSLAM in a functional sense, detailing the equipment involved. Please do this both for the current ATM-based DSLAMs and for the latest generation Ethernet-based ones. We are specifically seeking clarification on the additional equipment required (such as an ATM node or a layer 2 Ethernet switch), how it would be used, and the degree, if any, to which it would be shared with other services (as would probably be the case at least for an ATM node). (b) In addition, we are seeking clarification on potential limitations of OAOs directly connecting to ATM-based DSLAMs. For example, from a practical prospective would it be necessary to have a dedicated ATM-based DSLAM per operator? For the purposes of this question, please disregard the use of Ethernet-based DSLAMs. 5

8 Question 3.6 Bitstream connection component prices (a) Can you please provide us with indicative price information for the equipment you have described in Question 3.5? Please disaggregate your answer as far as is practical to separate out, for example, common parts (chassis, backplane, management cards etc) from per OAO (or group of OAO) parts (multi-port line cards etc). Where there are different types of equipment for different sizes, then please include this information as well. (b) Where relevant, please indicate the performance level of each item priced. (c) Please include any expected supplier discounts in the prices you provide us and also indicate the likely volumes that the prices would be relevant for. (d) Please provide your estimate of annual price changes over the next five years. (e) If there are any annual maintenance charges payable to the equipment providers (for example to cover software upgrades), please provide details. Question 3.7 Bitstream connection installation/commissioning costs Please provide us with information to allow us to estimate the installation/commissioning costs. This could, for example, either be in terms of a percentage uplift on the capital cost or in terms of the number of person-hours (presumably again split into time to install/commission the common parts and the OAO specific parts). Question 3.8 Bitstream connection asset lives Please provide us with your estimate of the asset lives of the equipment indicated above distinguishing between components, as necessary. If these lives differ from your internal accounting asset lives, please provide details of the differences and explain why. Question 3.9 Any Other Issue Please provide us with any additional information and/or data which you think is relevant. 6

9 4 SUB-LOOPS We have identified three possible options for the re-modelling to take account of the need to cater for sub-loops. These options were presented at our meetings with TDC and the Working Group on 4 May. Essentially, the options are: (a) Option 1. Increase the number of nodes (currently the ASM locations) to include the Technical Houses and/or Street Cabinets as necessary. Thus there would be no distinction between loop (a connection between the ASM and NTP) and sub-loop (a connection between the Technical House and NTP). The implication of this is that the average loop length would decrease and so would the national average loop cost/price. (b) Option 2. A sub-loop would be defined as a connection between the PDP and the NTP, and a loop would be defined as a sub-loop plus a connection between the PDP and ASM. The costs would be tagged within the model so as to allow for a distinction to be kept between costs associated with the link between the ASM and PDP and those between the PDP and NTP. (c) Option 3. Each of the 20 sample areas would be broken down into individual Technical House areas and a residual area covering the remainder of the customer base for that sample area. The Technical House areas would form the basis of the cost/price for the sub-loops and the residual areas would form the basis of the cost/price for the full loops. The necessary modelling will vary depending on the precise option selected. For example, in Options 1 and 3 there would be a need to increase the number of nodes to take account of TH and DSLAM street cabinet, whereas in Option 2 every PDP would be considered as a potential TH/Street cabinet. During our previous discussions with both TDC and the Working Group, we were made aware of the following issues that needed to be addressed: (a) Even after a Technical House or DSLAM street cabinet had been deployed, the copper between the same and the ASM would remain. This would/could be used either to retain a full loop back to the ASM for traditional telephony, or to allow an OAO to unbundle the complete loop back to the ASM (or to continue to do so where the loop had already been unbundled prior to the introduction of a sub-loop DSLAM). (b) The OAOs foresaw an increasing requirement for co-location space and power equipment at the sub-rack/shelf level, particularly with reference to likely availability of space in TH and street cabinets. Question 4.1 Number and location of TH/Street cabinets Please provide us with your assessment of the number and location of TH and street cabinets with DSLAM capabilities that would need to be added to the model of the access 7

10 network to meet the following target: providing 75 per cent of the population with the capability of receiving 20 Mbit/s broadband by the end of 2008 Question 4.2 Dispersion of TH/Street cabinets across geo-types Please provide us with your view on how the total number of TH and Street cabinets with DSLAM capabilities will be split across the four geo-types currently defined within the model. Question 4.3 Product specification for co-location (for OAOs only) How would you like to see the co-location product list expanded to cater for sub-rack/shelf co-location and power requirements? Question 4.4 Any other issue Please provide us with any additional information and/or data which you think is relevant. 8

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