Arcep’s latest review spans five years for the first time, with new obligations on Orange in managing its copper switch-off programme as the country transitions to fibre
Arcep notifies the EC of its seventh broadband market review
On 27 October 2023, Arcep announced that it had submitted its proposed regulation of the fixed broadband and superfast broadband markets in France to the EC for its opinion. In its seventh review cycle, Arcep has identified four key objectives that led it to propose changes to the existing regulation for the 2024-2028 period:
Provide a framework for the copper network switch-off;
Maintain a satisfactory quality of service on the copper network;
Facilitate the completion of fibre rollouts while ensuring effective access to civil engineering infrastructure (i.e. poles, underground ducts); and
Bolster competition in the business market.
Orange faces new obligations in line with the regulator’s objectives
Arcep has continued to identify former incumbent operator Orange as having significant market power (SMP) in the relevant markets. It has therefore proposed asymmetric regulation (i.e. rules that apply only to Orange) for the review period for three markets:
Market 1 for passive solutions, where Orange will face quality of service obligations relating to the copper network and a requirement to provide passive shared local loop access in fibre to help satisfy the needs of business market;
Market 2 for dedicated activated solutions for businesses, where Orange will be subject to rules relating to transparency and notice periods, but will see a requirement to connect alternative operators’ base stations fall away; and
A separate civil engineering market, in which Arcep has clarified the obligations on Orange, with the aim of reducing the turnaround time on rehabilitation work and connection lead times for end users.
To meet the regulator’s copper switch-off objective, Orange’s decommissioning of its legacy network will require notice periods that factor in the status of local fibre network deployments, as well as stronger data sharing obligations to provide clarity for stakeholders on Orange’s plans. Arcep’s work on Market 3b for generalist active solutions is progressing according to a different timetable, and will factor in market developments over the past year.
France’s competition authority supports Arcep’s analysis
In its opinion of 5 October 2023, France’s national competition authority (the Autorité de la concurrence) stated that it welcomes the main changes being made to the existing regulatory framework through Arcep’s review, which spans a five-year period for the first time (rather than the traditional three). It comes at a pivotal time given the forthcoming implementation of the copper switch-off plan proposed by Orange. The authority supports Arcep’s approach to defining different product and service markets for which ex-ante rules are necessary, the designation of an operator considered to be "exercising a decisive influence" (i.e. SMP) and intended remedies, including access to civil engineering infrastructure. It also made several observations that Arcep has looked to take into account, helping to inform thinking on the future of fixed market regulation over the medium term. For example, the authority has encouraged Arcep to ensure that the easing of the quality of service framework linked to the commercial closure of the copper network does not create competitive imbalances in the market.
The review could be finalised by the end of the year
Arcep is also notifying its draft decision on price caps for unbundling of Orange’s copper local loop (LLU), with the operator being subject to cost-based pricing for 2024 and 2025. This obligation was submitted to a public consultation that ran from 7 September to 9 October. Stakeholder feedback did not necessitate that Arcep make any substantial changes to its initial proposals. As with the new copper charge control, the regulator is now in the final stage in its market review process, which follows the publication of its “Scorecard and Outlook” document in July 2022 and two successive consultations on draft decisions earlier this year. Depending on the EC’s comments, Arcep could adopt its final decisions on wholesale fixed broadband regulation in December.
