Arcep rules for Bouygues in fibre spat with SFR

Industry News

SFR FTTH is overcharging Bouygues Telecom for access to its fibre-to-the-home infrastructure, Arcep has ruled.

The French regulator upheld complaints from Bouygues Telecom dating back to the start of the year. In a nutshell, SFR FTTH raised its prices for last-drop access in rural areas and Bouygues Telecom was deeply unhappy about it.

It’s a complex arrangement, but essentially France mandated the sharing of the last drop in FTTH networks over a decade ago and there are various rules in place to facilitate this. In sparsely populated areas, infrastructure operators must propose co-financing solutions, to share the cost with service providers wanting to access their last drop, and also offer a passive line rental option, under reasonable pricing terms and conditions.

On the co-financing element, Bouygues Telecom lodged a complaint in January with respect to a planned rate increased scheduled for the following month. After an investigation, Arcep sided with Bouygues, noting that SFR FTTH was unable to justify the additional cost.

“In particular, it emerged from the investigation that the elements put forth by SFR FTTH made it impossible to assess the reality of the alleged additional costs, or the extent to which the market parameters underlying the co-financing rates actually departed from SFR FTTH’s initial hypotheses,” Arcep said.

The passive line rental option also open to Bouygues Telecom was not viewed any more favourably by the regulator.

SFR FTTH aimed to charge €16.40 excluding VAT per line, per month, but Bouygues Telecom requested a rate somewhere between €12.20 and €13.20. Arcep ruled that the top end of that price rate – €13.20 excluding VAT – would be a reasonable level.

It ordered SFR FTTH to alter its rates accordingly, with the caveat that it is free to adjust those rates based on the pricing index for the current year. So while Bouygues emerged victorious in this dispute, it could still be facing FTTH access prices that it finds less-than-palatable going forward.

Nonetheless, when you look at the market for full fibre in France, it is clear that the regulations governing it are doing their job. The country ranks third in Europe, behind Russia and Spain, in terms of FTTH/B subscriptions, according to the latest FTTH Council Europe report. It was the biggest mover in terms of homes passed, adding 3.5 million in the year to September 2019, and is mid-table when it comes to uptake at 25.6%. It’s not ‘job done’ in France, by any means, but its operators are making a good fist of rolling out infrastructure and adding customers.

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