DT's $1.1B Vectoring Plans Thrown Into Doubt After New Ruling
Deutsche Telekom's vectoring plans have been thrown into doubt by a new draft ruling from Germany's regulator that will require the operator to offer additional wholesale services to its rivals.
On Monday, the German incumbent was given the regulatory go-ahead to spend about €1 billion (US$1.1 billion) on extending vectoring to another 6 million homes, representing about 15% of Germany's population, having previously received permission for a deployment covering around 65% of the population.
Answering questions from Light Reading, a company spokesperson hinted that Monday's regulatory move could force Deutsche Telekom to reconsider its latest spending plans but would not affect the original scheme of covering 65% of Germany's population with vectoring technology.
"Deutsche Telekom must provide another regulated wholesale product [and] this means more regulation and more administrative effort and affects the investment decisions," he said. "The rollout outside of the [new] area … remains unaffected and we will be pushing it continuously ahead."
The spokesperson also suggested that BNetzA's ruling might even prevent Deutsche Telekom from introducing vectoring in some of the new areas, instead giving its competitors "the possibility of an exclusive vectoring rollout."
"It remains to be seen how seriously the competitors will engage themselves in the broadband rollout in these areas and what this will mean for our calculation," he said.
Deutsche Telekom is looking to vectoring technology to boost connection speeds on its copper-based broadband network and help it compete against cable operators touting faster services.
The question is whether adverse regulation and concomitant slow progress on the rollout of vectoring might persuade the operator to consider alternative technologies.
Deutsche Telekom has previously flagged plans to extend vectoring to 80% of premises by the end of 2018 but appears to be a long way off this target right now. (See DT Expands Its Vectoring Commitments.)
In July, a Deutsche Telekom spokesperson told Light Reading that vectoring was then available to just 2.5 million homes -- about 6% of total households in Germany -- and that it would be extended to 6 million by the end of this year.
The operator has recently refused to disclose figures about the current status of the vectoring rollout, instead directing Light Reading to a website (German-language) that features broad details of the areas in which vectoring is now available.
By cutting out noise interference, vectoring boosts the connection speeds that can be delivered over last-mile copper connections to a theoretical maximum of 100 Mbit/s, although real-world speeds are likely to be much less, especially where homes are located at some distance from street cabinets. (See Copper Soldiers On: Broadband Special Report Part 1 and Optical Options for FTTH/B: Broadband Special Report Part 2.)
In the meantime, Deutsche Telekom has continued to lose out to its cable rivals, its share of retail broadband connections dipping to 41.2% in the July-to-September quarter from 41.8% a year earlier.
While cable competition is not present in all parts of Germany, cable services of up to 400 Mbit/s are currently being advertised by some players. (See Tele Columbus to Launch 400Mbit/s Service.)
Deutsche Telekom is now looking at an upgrade called super-vectoring that it claims could boost connection speeds to around 250 Mbit/s, but it has yet to announce any firm plans in this area.
CEO Timotheus Höttges has also highlighted his interest in another copper-fortifying technology called G.fast, which -- he says -- could support connection speeds of up to 1 Gbit/s thanks to recent improvements. (See DT Eyes Gigabit G.fast in Germany.)
In the UK, fixed-line incumbent BT Group plc (NYSE: BT; London: BTA) hopes the use of G.fast will allow it to provide 300-500Mbit/s services to as many as 10 million homes by the end of 2020. (See Long-Range, High-Speed Gfast Is Coming – BT.)
As with super-vectoring, however, Deutsche Telekom has yet to indicate how G.fast will figure in its broadband plans and currently insists it will not introduce the technology before it has deployed services based on super-vectoring.
— Iain Morris, , News Editor, Light Reading