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2 Accelerating Broadband Deployment Through
Network Sharing and Co-investment
Author: Malcolm Webb, Partner, Webb Henderson
2.1 Introduction: the value of the New Zealand government and Chorus to roll
network sharing out a fibre-to-the home network.
This chapter considers whether governments
Governments around the world recognize
that there are substantial societal benefits in should try an alternative approach: encouraging
deploying new broadband networks and services or providing incentives for network sharing (the
term commonly used in the mobile sector) or co-
– for example, 4G wireless networks and fibre
transmission lines. And many governments feel investment (the term commonly used in the fixed
sector). This approach enlists multiple operators
that current investment levels are insufficient.
– or even the government itself – as partners
in solving the "further and faster" challenge of
Of course, these governments need to broadband deployment.
acknowledge that broadband networks are very
expensive, particularly if deployed nationwide.
Moreover, construction risks can be high 2.2 Advantages to governments
and returns on investment are uncertain. So,
governments may need to be creative and of network sharing and co-
innovative to find ways to encourage operator investment
investment and reduce the risks that operators
face in deploying widespread broadband networks Governments are likely to view network sharing
and affordable services. and co-investment initiatives positively, particularly
in areas where there is limited scope for
Governments have tried to address these competition among multiple networks. In parts of
challenges in several ways. Some have chosen many countries, there is only limited potential for
to build broadband networks themselves. network-based competition in fixed access and
Government-built access networks include backhaul/backbone market segments beyond the
NBN Co. in Australia and QNBN in Qatar, main trunk routes. There is far greater latitude for
while backhaul/backbone networks have infrastructure-based competition, however, in the
been constructed in rural areas of India, mobile sector. Even then, it may make sense to
Argentina and Brazil. But building a nationwide build only a single mobile network in higher cost,
broadband network is beyond the reach of many low-ARPU ("Average Revenue Per User") regions.
governments, particularly in the access or "last
mile" segment. Backhaul and backbone networks This chapter differentiates network sharing from
are potentially more affordable – for example, a situation in which a single network operator
the government of South Africa, a middle income deploys a fixed or mobile network and then is
country, has invested in backhaul/backbone required to provide open access to third parties.
through Infraco. Although open access technically involves a
sharing of infrastructure, it is not the same
Other governments have chosen to incentivize business relationship as a joint venture or other
a single operator to deploy the network, usually arrangement among multiple operators to deploy
with a mandate to provide open access. Examples a new network.
include the Malaysian government’s arrangement
for Telekom Malaysia to roll out a high-speed, Infrastructure sharing creates a new and different
broadband network and the agreement between market dynamic. It can change market structures.
Trends in Telecommunication Reform 2016 55
