SIVA project, University of Ljubljana, July 2014 Report on common policy approaches and suggested measures to maximize the use and sharing of physical infrastructures in broadband deployment. www.siva-project.eu

1. Project acronym: SIVA
Project name: South East Europe improved virtual accessibility through joint initiatives
facilitating the rollout of broadband networks
Program: South East Europe Transnational Cooperation Program
Document Information:
Document title: Common policy approaches and suggested measures to maximize the
use and sharing of physical infrastructures in broadband deployment
Date of Delivery: 23/07/2014
Work Package: WP5
Work Package Title: Exchange of experience, administrative and policy measures to improve
the virtual accessibility of SEE areas
Work Package Leader: ERDF PP1 - Molise
Task: A532 Common policy processes and suggested measures to maximize
the use and sharing of available physical infrastructures in broadband
deployment for SEE areas
Task Leader: PEDDM
Distribution (R/P): Public
Nature: Report
History Chart
Date Changes Cause of change Implemented by
23/07/2014 Initial Document N/A PEDDM
Authorisation
Disclaimer
The information in this document is subject to change without notice.
All rights reserved
The document is proprietary of the SIVA Consortium. No copying or distributing, in any form or by any
means, is allowed without the prior written agreement of the owner of the property rights. This
document reflects only the authors’ view. The SEE Program is not liable for any use that may be made of
the information contained herein.
No. Action Partner Date
1 Prepared PEDDM 23/07/2014

2. Table of Contents
1 Introduction ..........................................................................................................................................3
2 The potential of investing in broadband...............................................................................................5
2.1 Economic development ................................................................................................................5
2.2 Improving social cohesion.............................................................................................................7
3 Use and sharing of existing physical infrastructures in broadband network deployment...................9
3.1 Position statement........................................................................................................................9
3.2 Problem description......................................................................................................................9
3.2.1 Digital divide..........................................................................................................................9
3.2.2 High investment costs.........................................................................................................12
3.3 Political background....................................................................................................................15
3.4 The rationale for recommendations...........................................................................................20
4 Common policy processes and suggested measures..........................................................................24
5 References ..........................................................................................................................................28

3. 1 Introduction
The European Commission (EC) introduced the Digital Agenda for Europe (DAE)1
as one of the flagship
initiatives for Europe 2020 aiming at providing sustainable economic and social benefits from a digital
single market based on high-speed broadband services.
Broadband is the fourth strategic pillar2
of the Digital Agenda for Europe (DAE). The connectivity and
internet access it provides is a key enabler for a number of important services for citizens, businesses
and the public sector. The ambitious and aggressive targets3
set in the Digital Agenda indicate the
importance of broadband for the economy of the EU and citizen welfare.
The SIVA project supports the goals of EU's strategy on digital technologies (namely the Digital Agenda
for Europe) and aims to contribute to the improvement of virtual accessibility in South East Europe
through the promotion of broadband access, supplementing physical accessibility and thus narrowing
the digital gap in the SEE area.
Towards the implementation of these targets, the Digital Agenda and the European Commission has
highlighted the need for additional efforts to be made in the field of infrastructure sharing so as to
overcome the investment challenges arisen within the planning-to-implementation process of
broadband network deployment.
Exploring this potential in the context of the SIVA project is of particular added value as progress in this
aspect will have a direct impact on bringing down the set up cost, accelerating cost-effective
deployment of broadband networks and bridging the digital divide in SEE territories.
1
http://ec.europa.eu/digital-agenda/
2
Pillar IV: Fast and ultra-fast Internet access https://ec.europa.eu/digital-agenda/en/our-goals/pillar-iv-fast-and-
ultra-fast-internet-access
3
The ambitious broadband targets of the Digital Agenda include: 100% coverage at speeds of at least 30 Mbps for
all Europeans and subscription of internet connection above 100 Mbps for 50% or more of European households
until 2020.

4. This report is the deliverable of Activity 5.3.2 of the SIVA project, which constitutes the second part of
activity 5.3 entitled “Promotion of cost reduction strategies by facilitating the sharing of physical
infrastructures for network deployment in South East Europe”.
In the context of WP5, which works towards promoting the exchange of experiences, consultation
processes and coordination of strategies and plans related to the development of broadband
infrastructures, this report aims to put forward common policy approaches and suggested measures to
maximise the use and sharing of available physical infrastructures in broadband network deployment for
SEE areas.
Building upon the provisions of the recommendation of the COM(2010)4724
communication and of the
Directive 2002/21/EC5
related to the right of public authorities to require the disclosure of the existence
and condition of local access infrastructure from operators with the aim of stimulating competition, this
deliverable provides specific policy recommendations and consensus-building approaches in order to set
the basis for a comprehensive regulatory framework that will surround infrastructure sharing and will
enable the acceleration of broadband deployment synergies with the purpose to promote broadband
investments and eventually bridge the digital divide.
In a nutshell, the report is outlined as follows: section 2 provides a comprehensive analysis of the
potential in investing in broadband in terms of economic growth and social cohesion; section 3 provides
a policy analysis of the measure of infrastructure describing the political background as well as
identifying sources of values and challenges and section 4 concludes with the provision of policy
recommendations and suggested measures that national authorities should embrace in order to support
infrastructure sharing.
4
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:0472:FIN:EN:PDF
5
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2002:108:0033:0033:EN:PDF

5. 2 The potential of investing in broadband
2.1 Economic development
It is widely agreed that broadband is considered a significant determinant for citizen welfare and an
accelerator for economic development. The impact of broadband penetration on economic growth is
quite evident and manifold while numerous economic benefits can be yielded by deploying broadband
deployment investments to both consumers and businesses in the same territory.
Broadband technology is considered a critical contributor and accelerator of economic development at
several levels. Direct effects of broadband on economic growth relate to the positive influence in terms
of business activities and employment investments in broadband technologies and in the rolling out of
infrastructures. On the other hand, broadband is also associated with a number of indirect effects
through a variety of channels, such as innovation production, technology and productivity enhancement
competition increase, and efficient functional deployment of enterprises and upgraded public sector
services.
Extensive research on the contribution of broadband to GDP growth has confirmed the significant
positive impact of broadband penetration on economic development even if the results drawn in
several research studies vary widely. According to the Single Market Act II Communication of the
European Commission6
, a 10% increase in broadband penetration results in a 1-1.5 % increase in the
GDP annually and 1.5% labour productivity gains.
Table 1 provides the research results of various studies conducted worldwide in investigating the
relation between broadband penetration and economic growth. The results verify a significant positive
relationship between broadband penetration and GDP growth. The results indicate that a 10% increase
in broadband penetration appears to bring about a substantial raise in GDP growth that ranges from
0.25% to 1.5%.
6
(COM (2012) 573)

6. Table 1: Research results of broadband impact on GDP growth (Source: ITU7)
Authors - Institutions Country Data Results
OECD Czernich et al. (2009) –
University of Munich
25 OECD countries
between 1996 and 2007
A 10% increase in broadband penetration
raises per capita GDP growth by 0.9-1.5
percentage points
Koutroumpis (2009) –
Imperial College
22 OECD countries
between 2002-2007
A 10% increase in broadband penetration
yields 0.25% in GDP growth
High Income Economies Qiang et al. (2009) –
World Bank
1980-2002 for 66 high
income countries
10% increase in broadband penetration
yielded an additional 1.21 percentage
points of GDP growth
Low & Middle Income
Economies
Qiang et al. (2009) –
World Bank
1980-2002 for the
remaining 120 countries
(low and middle income)
10% increase in broadband penetration
yielded an additional 1.38 in GDP growth
USA Thompson and Garbacz
(2008) – Ohio University
46 States of US for the
period 2001-2005
A 10% increase in broadband penetration
is associated with 3.6% increase in
efficiency
The deployment of broadband technology does not only improve the productivity of enterprises by
facilitating the adoption of more efficient businesses processes including marketing, inventory
optimisation and streamlining of supply chain but also enhance labour productivity. According to ITU
(2012), productivity of information workers, defined as the portion of the economically active
population whose working function is to process information (administrative employees, managers,
teachers, journalists) depends directly on the investment in ICT capital (and particularly broadband).
What is more, broadband appears to be a significant determinant to the reduction of unemployment.
Broadband technology does contribute to employment growth, both as a result of network construction
programmes and following spill-over impacts and externalities on the rest of the national and local
economy. Even though the deployment programmes and projects are, as expected concentrated in the
construction and telecommunications sectors, the impact of externalities are greater in sectors with
high transaction costs including financial services, education, and health care. More especially, in
remote rural areas, broadband connectivity may pave the way for citizens to investigate new
opportunities for professional and economic development. According to the Single Market Act II
Communication, broadband-induced innovation in companies creates employment and has the
potential to generate 2 million extra jobs by 2020.
7
http://www.itu.int/ITU-D/treg/broadband/ITU-BB-Reports_Impact-of-Broadband-on-the-Economy.pdf

7. Finally, beyond economic development and employment growth, broadband technology has a quite
evident positive effect in consumer surplus in terms of benefits to the consumers. Broadband service
outcomes include efficient access to information, savings in transportation, benefits in health and
entertainment and access to a great number of social and entertainment services offered worldwide,
and can be measured in terms of the difference between consumers' willingness to pay for the
broadband service and actual prices.
2.2 Improving social cohesion
Broadband technology is associated with a series of social benefits that enhance social cohesion and
ensure citizen well-being. The strong impact of broadband on the social surrounding stems mainly from
the fact that broadband provides access to services that were unavailable and unattainable before the
broadband penetration. Overcoming the challenges of the low population density and the remoteness
of areas, broadband addresses the issue of digital exclusion promoting and ensuring social inclusion and
equal access to all citizens. A range of benefits from the social impact of broadband are described as
follows:
- Participation in the political process: Broadband via the internet has increased the participation
of citizens in decision making process and political procedures. The biggest impact appears to
have been in the area of information and awareness where transparency of decision making
procedures has been significantly increased in many countries. Citizens are able to monitor
state’s operations, discuss political implications and participate in the political process through
the utilisation of tools for e-consultation and e-participation as well as platforms for interacting
with elected officials and departments.
- Improved communication and social interaction: Consumer benefits include better relations
between people regardless of distance. In that context, broadband impact focuses on sociability
and social interaction. Research studies show that the Internet promotes contact with friends
and family, and also allows users to maintain relationships with people who share the same
interests with them.

8. - Education and lifelong learning: Increased broadband penetration can provide large sections of
the community of rural area with the opportunity to engage in long-term, lifelong learning.
Particularly in rural locations, e-learning can supplement existing face-to-face teaching and
provide a wider range of resources and courses that can be studied no matter the distance.
- Provision of e-health services: Broadband improves welfare by providing services such as e-
health that improve quality of life. The ability to access information on healthcare often appears
as one of the major reasons for obtaining access to the Internet and broadband services. The
availability of better health-related information has led to an improvement in healthcare in
many countries. Citizens are able to access health-related information and search for health
matters of concern for themselves or their families. That will eventually lead to the adoption by
citizens of more proactive approaches to health issues as well as better self-management.
- Remote Working: Broadband has greatly enabled new ways of working which should come to
the benefit of both workers and employers by introducing more flexible working conditions in
terms of location and time (e.g. parents with young children, who may be unable to work away
from home, can now join the workforce).

9. 3 Use and sharing of existing physical infrastructures in broadband network
deployment
3.1 Position statement
The ultimate objective of policy recommendations and suggested measures is to provide essential
guidelines towards the promotion of cost reduction strategies through common policy approaches on
enabling the sharing of physical infrastructures for broadband network deployment in South East
Europe. This section puts forward common policy approaches and suggested measures to maximise the
use and sharing of available physical infrastructures in broadband network deployment for SEE areas
from a perspective of establishing an appropriate regulatory and policy framework that will facilitate the
roll out of broadband investments through the disclosure of the existence and condition of local access
infrastructures from operators with the aim to enhance competition and stimulate broadband
deployment investments.
3.2 Problem description
3.2.1 Digital divide
The digital divide is a phenomenon defined as the gap between groups, individuals, businesses,
households and geographic territories at different social-economic levels in terms of access to use of or
knowledge of Information and Communication Technologies (ICT) and more especially in terms of their
opportunities to have access to broadband services (OECD, 2001). This is why the ability of individuals
and businesses to take advantage of the broadband services varies substantially among countries as well
as among different geographic areas within the same territory.
As described above, digital divide can be witnessed among countries as well as among different
geographic regions within the same countries. On the one hand, the digital divide between countries
refers to the global digital divide or else the digital disparities witnessed between developed and
developing countries and among countries on an international scale. On the other hand, the digital

10. divide within countries refers to the inequalities between groups, individual, businesses and geographic
areas at different socioeconomic or demographic levels.
Some of the factors that can cause or enhance a digital gap within the same territory, making a
commercial business plan unfavourable and therefore preventing broadband investments in a rural area
by commercial operators are the difficult geographical characteristics, the low level of disposable
income in the area, the vandalism of existing telecommunication infrastructures as well as the barriers
set by the national authorities in terms of administrative procedures and bureaucracy. To begin with,
broadband network deployment can be hampered significantly by difficult geospatial characteristics
such as mountainous surface or sparse population that would increase the investment challenge as well
as the financial risk of deploying broadband networks in such an area without state aid. Low level of
income within rural areas and regions is likely to reduce the demand for broadband services and as a
result the business case for operators would not be viable in terms of generating a return on
investment. What is more, the theft or vandalism of optical fibers, facilities and telecommunication
infrastructures is a common phenomenon in some areas and more especially in developing countries
which set inter alias an additional challenge for broadband deployment investments. Finally,
administrative barriers and bureaucracy is a common cause that delays broadband deployment projects
and in most cases constitutes a critical preventing factor for private endeavours.
The accessibility of individuals and businesses to broadband solutions and services has been a topic of
particular interest within the SEE area. Evident shows that the ability of EU citizens and businesses to
use of broadband opportunities varies significantly across the EU as well as between the EU as a whole
and the SEE area as an independent area of interest. According to the SEE Transnational Cooperation
Programme, a serious digital gap is quite evident in terms of telecommunication services and
infrastructures between the EU and SEE given that the latter demonstrates on average a number of 154
internet users per 1000 people while the EU figure is more than double. Yet, a heterogeneous diffusion
of broadband connections is also evident among countries of South East Europe as well as between
urban and rural areas within the same territories.
A thorough analysis of the above issue was conducted in the context of the SIVA deliverable
“Orientation and assessment of needs' analysis regarding the potential for converging regarding the

11. improvement of virtual accessibility of the SEE area” (O332). The mapping of the coverage of broadband
services in SEE area provided a contradicting picture regarding the actual situation. While for EU
countries of SEE the rates of broadband coverage is quite high and the disparities appear to be limited,
for under-accession countries the rates are significantly lower while the diffusion within country appears
extremely heterogeneous. As regards the Next Generation Access services, the deployment of fiber
networks for NGA is still in progress in the SIVA countries. While some countries have already created
significant portions of the necessary infrastructures, others are now beginning the deployment. The
disparities are evident not only within the same countries as the NGA is in progress but also between
the EU countries and the under-accession countries of SEE.
To conclude, the recognized disparity between broadband availability in urban and rural areas in SEE
area can be attributed mainly to the fact that market mechanisms fail to address adequately the low
population density and rural and remote areas. Inadequacies in the telecommunication infrastructure
and accessibility to broadband services in individual countries, or even regions and cities within the
same country, significantly hamper competitiveness and cohesion. These problems, explaining at a
significant extent the existing digital inequalities among countries and regions within the same territory,
have been widely acknowledged in the SEE programme area, at a national as well as at local level.

12. 3.2.2 High investment costs
Improving virtual accessibility of SEE territories as well as minimising the digital divide entails further
deployment of broadband infrastructure for service improvement in terms of coverage rate, speed and
pricing. In most rural areas of SEE, low population density and high deployment costs discourage private
investment creating a negative feedback of limited capacity, high prices, and low service demand. The
high investment costs constitute a significant preventing factor for the deployment of broadband
infrastructures as in many cases there is not a good commercial business case for private providers to
run such an endeavour. Acknowledging the need and importance of policies and action plans to provide
better broadband coverage and high-speed services, the EU stresses the need for additional efforts to
be made in order to address the investment challenge of high-speed broadband infrastructure which is
the major bottleneck tackling and delaying the reaching of broadband targets set out by the European
Commission.
The rolling out of broadband networks in SEE countries is associated with significant investment costs
that in most business cases are not justified by the expected revenues, setting inter alia a crucial
investment challenge. These costs can be attributed to several barriers identified in both the supply and
demand side8
of the rollout process:
- On the demand-side, the main barriers are the limited demand for broadband services as
compared to conventional internet connections and the relatively high cost of terminals
required for internet access. That becomes more apparent in countries with low household
computer ownership and lack of established digital services to take full advantage of broadband
(e-health, e-government). Hence, the incentive for citizens to pay for high speed internet
connections is very low.
- On the supply side, the development of infrastructure in areas currently underserved (i.e. rural
and scarcely populated areas) is considered very expensive due to the size of the area that must
be covered. The return-on-investment expectations remain low due to the small population and
the number of customers to be served. Furthermore, high deployment costs can be attributed
8
Demand relates to user uptake and supply relates to operator/carrier offering.

13. to inefficiencies related to the utilisation of existing physical infrastructures such as conduits,
manholes, ducts, antenna installations etc.; barriers regarding to the co-ordination of civil
engineering works as well as bureaucratic administrative procedures and bottlenecks related to
in-building networks deployment.
The deployment of access network broadband services in rural and low competition areas is featured by
low subscriber densities; longer loop lengths; and lower duct availability, while the higher infrastructure
costs compared to high competition areas prevent the business case in these areas. In that context, the
reuse of existing physical infrastructures seems a viable solution to diminish the capital investments
costs for broadband network deployment. It is estimated that around 80% of the costs of deploying new
fixed infrastructure are civil engineering costs (i.e. trenching or digging) which can be significantly
reduced through a proper coordination by national, regional and local authorities, using town planning
rules and remedies mandating access to passive infrastructures. Wireless infrastructure costs can
similarly be reduced by such measures. Diminishing this cost removes an important barrier and brings a
significant and positive impact on the economic viability of the broadband network deployments. In that
context, the SIVA project sets forward a common approach for facilitating infrastructure sharing and
provides policy recommendations aiming to measures to maximise the use and sharing of available
physical infrastructures in broadband network deployment for SEE areas.
Table 2 summarizes the results of a survey conducted in the context of the SIVA project regarding the
barriers for further deployment of broadband infrastructure as reported by the project partners. These
barriers verify the aforementioned assumptions and argumentation for the countries of the SIVA
consortium. More particularly, the survey results verify that the high network deployment cost and the
lack of existing infrastructure are considerable barriers for the development of broadband services in
most of the SIVA countries.

14. Table 2: Major barriers for the deployment of broadband services in the SIVA countries (SIVA survey on broadband
penetration in SEE, 2013)
Barriers9
AT BG FYROM GR IT ME SI
Supply-side
Regulatory issues in general X
Lack of cooperation with local governments,
municipalities X X X
Lack of exact and concrete National Strategy
X
Access to spectrum
Lack of existing infrastructure X X X X X
Network deployment capital cost issues X X X X
Complex procedure (bureaucracy, etc.)
Lack of permits on local level
Lack of suitably skilled people for network
construction, maintenance, operation and training X
Demand-side
High cost for the subscriber either in terms of up
front or monthly charges for access X X
Not enough demand to justify infrastructure cost
X X X
High cost of user terminals
X X X X
9
This table depicts the positive answers of respondents, the barriers that were positively identified as barriers to
broadband access deployment

15. 3.3 Political background
This section provides a comprehensive background of the main EU recommendations for the
improvement of broadband networks focusing on the sharing of existing network facilities and physical
infrastructures10
.
Digital Agenda for Europe
Recognizing the need for and the role of public interventions in the development of the electronic
communications market, the European Union has adopted a series of critical steps for framing the
European broadband policy. The European Commission with the Digital Agenda for Europe11
has put into
place a long-term strategy for proliferating broadband services and eliminating the digital divide in its
territories. Sharing ambitious broadband targets, the Digital Agenda aims to achieve 100% coverage at
speeds of at least 30 Mbps for all Europeans and subscription of internet connection above 100 Mbps
for 50% or more of European households until 2020. In that context, European authorities have been
attempting to advance broadband diffusion and eliminate the digital gap by:
 Enhancing market competition;
 Establishing a consensus on national broadband policies;
 Improving access to networks and radio spectrum;
 Providing a number of funding opportunities and financial aid to (public and private) investors;
 Reinforcing the knowledge about the benefits of broadband services.
When it comes to the national level, public administrations and national authorities of the Member
States have the fundamental role to contextualize the actions in their specific reality and adjust their
national legislation and policy frameworks to this central EU strategy. Today, almost all Member States
have a broadband strategy. Most of them focus on complete coverage for basic levels of broadband (i.e.
adequate for email, routine surfing and administrative services) while very few of them set clear
10
A thorough evaluation of relevant national policies and their rate of alignment with EU directives in the SIVA
countries is performed in the SIVA deliverable “Orientation and assessment of needs' analysis regarding the
potential for converging regarding the improvement of virtual accessibility of the SEE area” (O332).
11
http://ec.europa.eu/digital-agenda/

16. operational measures in order to achieve the enhancement of the competition among providers in the
broadband market and to facilitate the rollout of high-speed Internet. Developing comprehensive
national broadband strategies will stimulate investment in fast internet access beyond current market
levels improving the NGA diffusion and diminishing the digital divide.
In order to manage the above objectives, the Digital Agenda has stressed the need for additional efforts
to be made in order to overcome the investment challenges arisen in the context of broadband
deployment. By introducing policies that diminish the overall cost of broadband development, the
Digital Agenda aims at prompting Member States to accelerate the deployment of next-generation
access (NGA) networks across Europe.
Regulatory framework for electronic communication networks and services
Introduced in 2002, the directive 2002/21/EC12
established a harmonised framework for the regulation
of electronic communications services, electronic communications networks, associated facilities and
associated services aiming to create the conditions for effective competition in the telecommunication
sector during the transition from monopoly to full competition. Among others, the regulatory
framework addressed the issue of mandated access to passive infrastructures or else the sharing of
broadband network facilities. More particular, the article 12 of the directive defines explicitly that
“where an undertaking providing electronic telecommunications networks has the right under national
legislation to install facilities on, over or under public or private property, national regulatory authorities
shall, taking full account of the principal of proportionality, be able to impose the sharing of such
facilities and infrastructures”.
The adoption of the EU electronic communications reform package13
in November 2009 further
enhanced the European electronic communications market by revising rules to ensure more effective
competition and better rights for consumers. As regards the issue of infrastructure sharing, new rules
were introduced to improve the regulatory framework. Such rules include the power given to national
12
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2002:108:0033:0033:EN:PDF
13
https://ec.europa.eu/digital-agenda/sites/digital-
agenda/files/Copy%20of%20Regulatory%20Framework%20for%20Electonic%20Communications%202013%20NO
%20CROPS.pdf

17. authorities to impose obligations in relation to the sharing of infrastructures in cases that duplication
may be economically inefficient or physically impracticable as well as the provision that requires
undertakings to provide information to national authorities as concerns the nature, availability and the
location of their facilities.
In a nutshell, much has been accomplished already: the market has become more competitive,
generating investment, innovation and growth in all 27 EU Member States. New communication services
have emerged and EU citizens now benefit from lower prices, better quality and increased transparency.
However, the common rules for the regulation of electronic communications networks and services are
being implemented in the Member States with different degrees of effectiveness. As a result, many
operators and citizens still perceive Europe as being a patchwork of different regulatory regimes. More
efforts are therefore still needed to move towards a single market for electronic communications.
The revised EU framework constitutes the basis for a supportive and consistent regulatory environment
targeting remaining challenges. They reinforce competition while enhancing incentives to invest. The
new body of European regulators (BEREC) will improve cooperation between national regulators and the
European Commission. This will lead to the creation of a common "regulatory culture", to more
consistency, and to a real single market for electronic communications networks and services.
Legislation for unbundling/wholesale access for copper-based and NGA networks
Unbundled access refers to the form of regulation whereas new entrants in the market of
telecommunications are offered access to the facilities and infrastructures of the incumbent so as to
avoid the duplication of infrastructures and waste of resources. Unbundling of the local loop (LLU)
specifically is an alternative way in which some the goals of infrastructure sharing – as a form of sharing-
can be achieved.
The local loop has been identified as an essential element in the context of Digital Agenda for Europe as
it is considered a prerequisite for allowing Europe to match its global competitors on Internet use.
Introducing competition on local copper networks will allow high-speed, fixed-price access to the
Internet to spread rapidly throughout Europe

18. The Regulation on Local Loop Unbundling (EC/2887/2000)14
came into force on 2 January 2001 requiring
incumbent operators throughout Europe to offer unbundled access to their local loops to new entrants
on reasonable request.
The regulation for unbundled access for copper-based networks aims to address the problem of the lack
of competition on the local network where incumbent operators continue to dominate the market for
voice telephony services and high-speed Internet access. Allowing new entrants access to the local loop
infrastructure will lead to increased competition and stimulate technological innovation on the local
internet access market. This will encourage the provision of a large range of competitive electronic
communications services.
Cost reduction for deploying broadband networks
Deployment of high-speed broadband networks is subject to various inefficiencies and bottlenecks
which lead to high costs for undertakings wishing to deploy networks, especially in rural areas. The
dominant cost (up to 80%) in deploying new networks is linked to civil engineering works. The
communication on digitally driven growth (COM (2010)/472/final)15
set forward a number of regulatory
and financing measures that should be adopted at national and local level to tackle these inefficiencies
and to bring down the civil engineering costs so as to incentivise infrastructure rollout. Building upon
such recommendations, the European Commission intends to work on the adoption of the regulation16
aimed at tackling:
 Inefficiencies or bottlenecks concerning the use of existing physical infrastructure (such as, for
example, ducts, conduits, manholes, cabinets, poles, masts, antennae, towers and other
supporting constructions);
 Bottlenecks related to co-deployment;
 Inefficiencies regarding administrative permit granting, and, finally
14
http://europa.eu/legislation_summaries/information_society/internet/l24108j_en.htm
15
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:0472:FIN:EN:PDF
16
Digital Agenda for Europe, Action 117: Reduction of the cost of deploying high speed electronic communication
networks http://ec.europa.eu/digital-agenda/en/pillar-iv-fast-and-ultra-fast-internet-access/action-117-reduction-
cost-deploying-high-speed

19.  Bottlenecks concerning in-building deployment.
In practical terms, thanks to the regulation the owners of all infrastructures, e.g. electricity, gas, water,
sewage, suitable to host electronic communications network elements will need to coordinate their
works. Local authorities will need to issue fewer permits. The implementation of proposed measures is
expected to incentivise rollout and facilitate investments by decreasing the associated costs by up to
30%. It is estimated that the total amount to be saved on deployment could reach over € 60 billion.

20. 3.4 The rationale for recommendations
The sharing of physical infrastructures refers to the obligation of the holders of the rights to install
facilities on, over, or under public or private property and to open up such infrastructures for access to
interested operators under reasonable and non-discriminatory conditions. The Directive of the
European Commission 140/2009/CE allows national regulatory authorities to impose the sharing of
network elements and associated facilities such as ducts, masts, manholes conduits etc. and ensure a
better coordination of civil engineering works.
Infrastructure sharing can take different forms as operators choose to share broadband infrastructure
components that are either passive or active. Passive infrastructure components refer to all the non-
electrical or civil engineering element of infrastructures such as pipes and ducts. Active infrastructure
components refer to all the electrical elements like fibres, access node switches and broadband remote
access servers.
As regards the coordination of civil works, every network operator can negotiate agreements with
companies or organisations authorised to provide electronic communications networks in view of
deploying elements of high-speed broadband. In order to enable better coordination of works, any
Passive infrastructure components
•Site
•Masts
•Ducts
•Shelters
•Technical premises
•Cables
•Splitters
•Easements
•Generators
•Electrical supply
Active infrastructure components
•Base stations
•Microwave radio equipment
•Switches
•Antennas
•Transreceivers
•Optical network unit
•Management systems
•Coarse or dende division multiplexing

21. network operator shall make available on request minimum information concerning on-going or
planned civil works related to its physical infrastructure.
Taking measures to a) maximise the use and sharing of available physical infrastructures and b)
coordinate civil works will bring about the following benefits:
1. Infrastructure sharing is a form of partnership between telecom operators aiming to decrease
capital investment in infrastructures and lower operational costs through the deployment and
operation of shared broadband network infrastructures and facilities. Improving infrastructure
sharing significantly lowers the overall financial cost of deploying electronic communication
infrastructure. Investment will be spread over the operators sharing their infrastructures instead
of being sustained by only one operator. The diminishing cost as well as the optimised
investment will contribute to better sustainability of telecom operators and will boost
investments in the sector of telecommunications which in turn will accelerate the construction
of new generation networks. Telecom equipment vendors estimate that sharing may reduce
infrastructure costs for operators by as much as 40 percent.
2. Diminishing capital investment costs will expand broadband deployment investments to less
dense and undeserved areas and meet universal service targets. Infrastructure sharing will help
operators to take advantage of the savings generated by investing less in denser areas and
prompt them to put forward broadband expansion investments in rural areas. This is why the
mandated access to the physical infrastructures as well as the enhanced coordination of the civil
works will make broadband infrastructure deployment economically viable in areas and regions
where the business case would not be possible or favourable. Among others, infrastructure
sharing has also a critical policy dimension given its crucial contribution to meet universal
service targets and diminish the digital divide within the same territories.
3. Crucial socio-economic benefits will arise from bringing and establishing broadband services to
populations and communities that would not be covered by such services. New service areas
will come to the front enhancing entrepreneurship and employability in the area.
4. Infrastructure sharing will optimise the use of scarce national resources. This is why sharing will
lead to better exploitation of scarce national resources such as rights of way and will eventually

22. allow a better use of spectrum. What is more, infrastructure sharing will reduce negative
environmental impact as less network build-up means fewer negative environmental impacts.
5. By decreasing the barriers to market entry for new players, infrastructures sharing will improve
competition in the telecommunications market resulting in improved quality of services and
retail prices for the citizens. When infrastructure sharing will be enforced, the
telecommunication market will be attractive to new players who are interested in investing in
the area of broadband deployment resulting in the enrichment of the competition among
operators and yielding numerous advantages and benefits in terms of innovation, better
customer service, better broadband coverage and better commercial offering and prices for the
consumers.
Similar endeavours of infrastructure sharing include European national regulatory authorities mandating
telecoms operators with significant market power to open up their ducts to smaller, competing
alternative telecoms operators resulting in asymmetric regulation. Examples of this include, but are not
limited to, Telefónica (Spain), Portugal Telecom (Portugal), Telekom Slovenije (Slovenia), Deutsche
Telekom (Germany), BT (UK) and France Telecom (France).
To conclude, the main intuition is that the sharing of infrastructures could be proved a critical way to
expand broadband coverage in under deserved areas. Where no suitable broadband infrastructures are
available, broadband infrastructure can share civil engineering infrastructure with other utilities (water,
gas, electricity etc.), hence diminishing significantly broadband deployment investment costs. In that
context, a better coordination of civil engineering works would be vital to support the broadband
infrastructure deployment in areas and regions where a business case would not be viable.
The challenges of infrastructure sharing
Even though the measure of infrastructure sharing has undoubtedly the potential described above, it is
generally associated with a series of challenges and risks that should be addressed before the
enforcement of the measure so as to ensure the successful creation of a favourable framework that will
surround infrastructure sharing and will yield the desired results in terms of broadband coverage and
bridging of digital divide. This is why infrastructure sharing is considered a complex undertaking with

23. several difficulties and challenges that need to be overcome. The issues and challenges associated with
the proposed measure are as follows:
 Legal issues related to the regulatory framework surrounding the procedure of sharing
infrastructures and more particularly the obligation of telecommunication companies and
utilities to open up their network facilities to operators.
 Issues related with the information available about the location and shareability of existing
infrastructures. Is there a cadastre of telecommunications where information and details about
the existing physical infrastructures, the owner of the facilities as well as their shareability exist
to make sharing more easily?
 What business interest is created and what motives are given to the incumbents for opening up
their facilities and infrastructures to new entrants and for providing their sensitive data and
company details in order to enable sharing? It’s critical for incumbents to acknowledge that
infrastructure sharing will have direct benefits not only for new entrants but also for them. A
regulatory framework that will define the provisions of access as well as the pricing scheme for
providing access to facilities should be put in place.
 Issues related to accessibility and user rights to data are considered of high importance. The
question arisen is who is allowed to request information from the operators and how operators
are obliged to provide their sensitive information? In that context, high resolution infrastructure
data will require control mechanisms such as restricted access to data, contractual agreements
with data users, restriction of access to a dedicated area etc.

24. 4 Common policy processes and suggested measures
The SIVA Consortium wishes to maximise the use and sharing of available physical infrastructures in
broadband network deployment for SEE areas and requests further actions for the accomplishment of
this effort. Thus, this section provides some general principles and recommendations that policy makers
and national authorities of the SEE area should embrace in their efforts to diminish deployment costs
and promote broadband deployment. Despite the fact that every SEE country operates in its own
specific political, economic and cultural context, the recommendations and common policy processes
drawn in this section seem to apply for all.
In order to promote the establishment of a market for mandated sharing of physical infrastructures,
national regulatory authorities should develop and establish a comprehensive regulatory framework to
govern the infrastructure sharing process addressing issues such as the determination of regulatory
prices, combating anti-competitive behaviours, removing administrative obstacles (e.g. difficulties in
obtaining permissions for new base stations or in renewing contracts for existing ones as well as the
definition of specifications (for sharing) imposed on operators deploying new facilities. Some guidance
to the national policy –makers and regulatory authorities may be offered as a starting point in order to
assist them set forward an enabling regulatory framework and policies to promote infrastructure
sharing. Policymakers and stakeholders should embrace the following key principles and guidelines:
Administrative issues
 Step up efforts to limit the complexity of the planning-to-implementation process as regards the
implementation of the measure of infrastructure sharing. One of the most substantial needs is
to determine procedures, obtain approvals and secure rights of way at an initial stage. In that
context, public authorities should configure the planning process of infrastructure sharing in
order to confront the delays that may arise because of the complexity of the administrative
processes, the bureaucracy as well as the great number of various levels of government and
public bodies involved in the implementation of the measure.

25.  As the broadband technology evolution involves significant financial investments in civil works,
like fiber, tower, etc., national governments should operate in that direction by stimulating the
start up of local companies for urban wiring facilitating the synergies with other “network”
services (gas, electricity, etc). The multi-utility company can be the owner of the broadband
network working in joint venture with a National or Regional operator, and facilitating the usage
of civil infrastructures and pipelines of other networks (electricity, gas, water supply, traffic light
network, public lighting, etc.) to allow easy construction of fixed or mobile broadband networks.
Regulatory framework and enabling policies
 Abolish the rules and regulatory provisions in national legislation prohibiting network operators
to negotiate access to physical infrastructures by electronic communications network providers.
 Transpose the relevant EU regulations and directive into national legislation so that national
regulatory authorities are able to impose infrastructure sharing.
 Establish a pricing scheme that will provide the right incentives for incumbents to open up their
facilities and allow access to their infrastructures. Commercially negotiated pricing should
prevail, however where market power exists, regulatory authorities should be able to impose
mandated access to physical infrastructures at a setting price so as to ensure the emergence of
new players and enable sharing.
 Implement licensing frameworks to allow open access providers and create motives for those
who have spare capacity on their networks to share that capacity.
 Authorize a central body to manage rights of way and administrative procedures. Such an
institutional actor will have a positive impact on the administrative burden faced by operators
and any infrastructure provider planning civil works. A new or existing organisation could offer a
range of services including a) the provision of information to interested parties; b) the forward
of wayleave applications from the operator to the infrastructure owner; c) the distribution of
building permits and d) the negotiations between the stakeholders.
 Establish an infrastructure sharing one-stop shop on rights of way to facilitate the coordination
of civil works among telecommunication service providers and between operators and other
utilities’ owners. Where responsible for rights of way, relevant authorities, including local

26. authorities, would provide information on necessary permits, applicable rules and conditions,
and so on to this central organisation (possibly the NRA).
 Create and establish necessary enforcement tools to ensure compliance and successful adoption
of infrastructure sharing regulations. As an infrastructure sharing relationship between service
providers involves elements of both cooperation and competition, the introduction of a dispute
resolution mechanism for addressing disputes that may arise between interested parties will
ensure the certainty of an adjudicated decision where necessary.
 Improve transparency and information sharing. Market players need to know what
infrastructures are available for sharing under clearly established terms and conditions, in order
to avoid unfair actions. Regulators should put forward the creation of a cadastre of
infrastructures which will contain the details of existing as well as future infrastructure
installations available for sharing by other service providers, such as relevant information on the
location, the availability of space in existing ducts and other local loop facilities, planned
deployment or upgrading works and interconnection. Such a measure will provide alternative
operators with the possibility to deploy their fibre networks at the same time as incumbents
stimulating competition or to support synergies optimising resources. Under that scheme,
telecommunication providers and utilities owners will be required to provide information and
details about their facilities and their shareability.
 Communicate the potential of infrastructure sharing as well as the opportunities arisen for
commercial synergies to stakeholders and interested parties.
Legal provisions
 Determine the legal framework conditions with a view to the provision and access to the
sensitive infrastructure data. High resolution infrastructure data and sensitive company details
pose high confidentiality requirements. As a result, special care should be given to defining what
type of data will be provisioned, how information will be acquired and maintained, when and
under what circumstances confidentiality will be maintained and any reasonably anticipated risk
associated with the inappropriate disclosure of data.

27.  Adopt provisions that oblige owners of physical infrastructures, who may be unwilling to
participate, to supply the necessary infrastructure details in the cadastre for the
telecommunication infrastructure.

28. 5 References
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growth”, CESifo Working Paper No. 2861.
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European Commission (2009), “Regulatory framework for electronic communications in the European
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European Commission (2010), “European Broadband: investing in digitally driven growth”, COM (2010)
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European Commission (2012), “Single Market Act II – Together for New Growth”, COM (2012) 573 final.
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