2023-12-18 16:45:10
Published on Dec 18 2023 at 5:45 p.m.
This is the project of the decade in telecoms: the withdrawal of the old Orange copper network, which has connected France since the 1970s. Having become obsolete since the widespread use of fiber, this ADSL support infrastructure will be implemented scrapped according to the operator’s commitments by 2030, by disconnecting increasingly large geographical areas. But how can we do this without depriving millions of French people of telephone and Internet, or strengthening Orange’s weight in fiber?
Faced with these risks, Arcep, the telecoms regulator, adopted new regulations on Monday, the result of 18 months of work. It will apply between 2024 and 2028. “The copper network will begin to be withdrawn on a large scale,” warns Laure de la Raudière, the president of Arcep. However, this can potentially create complex situations. Not regulating would have been a serious mistake. On the contrary, we now have the most ambitious regulation in Europe on the subject.”
The risk of an “annuity”
While relations between Arcep and Orange are very tense, just a few weeks after the operator received a record fine of 26 million euros on a related subject, the regulator has used carrots and sticks. In this new regulatory framework, the biggest change for Orange concerns the unbundling price, that is to say the price that other operators pay to use its copper network.
In areas covered by more than 95% fiber, the country’s historic operator will be able to charge more for the remaining copper lines that it alone owns: 75 cents more per line per month in 2024 then 1. 50 euros in 2025. In this way the total price will reach 9.95 euros then 10.70 euros in 2025. In areas where copper will be closed within two years, Orange will even be exempt from all pricing constraints.
This boost is good news for Orange. As the copper network is being emptied of subscribers in favor of fiber, the operator has seen its unbundling revenue melt like snow in the sun in recent years. At the same time, Orange must continue to invest in this infrastructure which, year after year, remains used by just under 10 million French people.
But this increase in unbundling prices will not fail to provoke debates in the sector, while SFR, Bouygues and Free regularly accuse Orange of deliberately underinvesting in the copper network, to protect as much as possible the “rent” that constitutes according to them unbundling. At the end of October, the Competition Authority also called on Arcep to be “vigilant” about these price reductions likely to create, according to it, “a risk of creating financial income for Orange”.
At the beginning of November, the European Commission made similar remarks in an opinion taken into account by Arcep. The regulator therefore reserves the right to review these prices depending on “the evolution of competitive conditions”, particularly in the event that Orange delays the closure of copper. For example, by slowing down on the latest fiber line deployments to take advantage of these better conditions for longer. In areas where tariff obligations will be lifted, Orange will also have to reimburse its rivals for overpayments if the two-year copper shutdown schedule is not met.
36 months’ notice
On the stick side, Orange will also have to respect new obligations. Before disconnecting copper in this or that area, the operator must give 36 months’ notice. “This is sufficient notice, which will allow other operators to migrate their fleets and offer their services” assures Laure de la Raudière. Orange will also have to share data, in a pro-competitive logic. The fear is that the operator will disconnect copper as a priority in areas that it itself has well covered with fiber, to attract new subscribers.
Other obligations concern the end of the fiber project, while the last lines to be deployed are now the hardest and therefore the most expensive. Orange will have to facilitate access to its “civil engineering”, that is to say the poles or tunnels used by other operators to provide fiber to customers. A “specific access service” will have to be created, given the “too long delays” that operators encountered, according to Laure de la Raudière.
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