The whole world has been talking about 3-D films since the incredible success of James Cameron’s Avatar. This technology requires the filming of two slightly different images at the same time; when it is projected on the screen, viewers wear glasses with filters so that the left eye sees a different image from the right – the brain merges these images to create a three-dimensional picture. The industry is working to make 3-D technology available for home use in the next few years, but it requires almost twice as much data because both images must be provided.

This example is only one of many explaining the steadily ­rising demand for greater bandwidths for data applications. Governments worldwide have recognized this trend and are offering specific support to meet it. The German government, for example, plans to ensure that by 2014 75% of the households will have broadband connections with a minimum of 50 MBit/s at their disposal. So the largest providers of these “Next Generation Access” (NGA) networks, which are based on the use of optical fiber, are under pressure to push ahead with the expansion of their networks.

Besides having to deal with the technological and operational challenges of this network expansion, NGA operators expect their marketing departments to play a special role because profitability is essentially dependent on achieving a market share with the critical mass for success simultaneously with a high take-up rate.

Studies indicate that the market share required for profitable expansion and operation of the fast FTTH (fiber to the home) networks in urban regions of Germany is around 25%. But in rural areas, a market share of more than 80% is necessary, even for the slower FTTC (fiber to the curb) technology, because of the high investments which must be incurred for the expansion of the optical fiber network. Analyses show that investments of €70 billion in Germany and a lower, but still high, figure of €40 billion in France and Great Britain will be needed for the FTTH expansion.

This is the economic background which is made even more problematic by the regulation of incumbents irrespective of the technologies used. There is no general competitive protection for optical fiber network operators in the sense of “exclusive rights and exclusive time periods for marketing”. On the contrary: an incumbent who is already subject to SMP regulation in the conventional fixed network must comply with the same regulations with respect to the marketing of its optical fiber network as in the conventional fixed network. Among other obligations, the company is required to open the pre-service interface, e.g., bitstream access or local loop unbundling, to alternative operators at prices regulated ex ante or ex post.