GSMA report slams wholesale open access networks
10 August 2017 | James Pearce
The GSMA has fired a warning shot to countries planning to implement wholesale open access networks (WOAN), claiming they are failing to fulfil promises of better connectivity.
A report issued by the industry body, made up of some of the world’s largest mobile operators, found that of five countries originally looking at proposing a single wholesale network (SWN) or WOAN, only Rwanda has actually rolled it out.
The other four countries mentioned in the GSMA’s study – Kenya, Mexico, Russia and South Africa – have all been plagued by slow progression and delayed or cancelled launches.
The report is a follow up on a 2014 study that assessed the potential economic case for implementing the wholesale network model. The GSMA is opposed to the deployment, preferring a one operator, one network system.
“Policymakers in countries considering a move to a wholesale open access network for 4G services may believe they can achieve greater network coverage compared with models that rely on network competition. However the research published today demonstrates that this is not the case,” said John Giusti, chief regulatory officer, GSMA.
“We have found that network competition produces faster and more extensive network coverage, and the examples highlighted in the report indicate little evidence that a SWN/WOAN is likely to achieve this.”
In its report, the GSMA said the current model, which sees policymakers preferring a competitive network structure and licensing agreements that limit the number of operators, has “resulted in unprecedented growth and innovation in mobile services; the industry has already connected more than 5 billion people globally, including 3.8 billion people in developing countries…”
It is important to note that the GSMA does have a vested interest, given it represents a number of private companies who would be forced to compete with government backed SWN or WOAN, a relatively new idea in telecoms that is aimed at boosting coverage and increasing competition.
The GSMA claims ambitious projects in places like Mexico, where deployment was supposed to begin in 2014 and be operational by 2018, has seen grossly escalating costs, leading to reduced investment targets of $7 billion (down from $10 billion). Altan ultimately won the contract out of an intial 21 bidders, a number of which dropped out.
In Rwanda, the only successful deployment so far according to the GSMA, its LTE network was launched in 2014 as part of an agreement between KT and the government. As of last year, it covered 25 out of 30 districts, with population coverage of around 30%. The GSMA claims it is unlikely the project will hit its 95% coverage target by the end of 2017.
The GSMA claims operators are already looking at alternative solutions to help expand coverage to remote areas, whilst balancing competition and co-operation. These include network-sharing agreements, new business models with third parties, and cost-sharing strategies.
“We are concerned that a move to wholesale networks will harm consumers, as history has demonstrated that network monopolies normally result in high prices and lower investment in infrastructure,” added Giusti.
“With this in mind, we call upon governments looking to implement a SWN or WOAN to instead support the ability of mobile operators to enter into infrastructure sharing agreements on a voluntary basis and consider how they can apply market-friendly spectrum assignment methods to maximise coverage, using appropriate spectrum license conditions to extend mobile services to underserved areas.”Follow @jamespearce87
8h | James Pearce
8h | James Pearce
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