Swisscom group Swisscom had to temporarily stop the FTTH expansion of its fiber-to-the-home network. This is the result of an order announced by the Swiss Federal Court (BGer) last week. This in turn is in response to Swisscom's objection to the previous judgment of the Federal Administrative Court (BVGer). The background of the quarrel was the construction method adopted for the expansion of the optical fiber network.

At a round table organized by the authorities from 2008 to 2012, the industry agreed to establish a nationwide optical fiber network architecture. At that time, the creation of the FTTH network was designated as a four-fiber model with a P2P topology.

In simple terms, the P2P/Point-to-Point standard refers to the connection from the connection center (PoP-Point of Presence) to the user with a four-fiber undivided optical cable in a star structure, which is called the first layer Offer. In this way, other telecommunications providers can provide access to four glass optical fibers ("unignited optical fibers") for free, thereby realizing competition.

Now, Swisscom, Switzerland's largest telecommunications company, hopes to double its current number of FTTH connections (including in rural areas) by 2025-from today serving one-third of Swiss households and businesses to around 60%. For this reason, Swisscom switched from a P2P network architecture to a so-called point-to-multipoint network topology (P2MP) about two years ago. Most importantly, it is much cheaper because it means less civil engineering is required. Work with larger cable ducts (ie build faster) and it is also more energy efficient because fewer switches (distributors) are required.

However, with P2MP, several customers use only one fiber-optic shared cable between the connection center and the distribution shaft on the street. Only in the shaft, the signal is distributed on multiple optical fibers with the help of a splitter (switch), and then leads to the connection of each customer. Init 7, Winterthur's telecommunications provider, believes that in the single-fiber model in the P2MP topology, smaller Internet providers rely on the technology used in the shared routing part of the company that expands the network. Where possible, Init7 provides customers with a maximum speed of up to 25 Gbit/s through P2P topology and dedicated optical fiber. However, Fredy Künzler, head of Init7, believes that for smaller Internet providers, installing and maintaining the splitter is not worthwhile.

Reason: In the P2MP network topology, the splitter must be placed close to the end customer, so it can only provide services to a few customers. Therefore, due to economic reasons, the last section of the route can hardly be operated by oneself, so the services of the company that establishes the network must be rented. Therefore, as a smaller provider, you are at a disadvantage.

Due to the transition from P2P to P2MP, Init7 filed a lawsuit with the Federal Competition Commission (Weko): With this move, Swisscom has taken the lead and determined, for example, what bandwidth topologies competitors can provide customers on the new network. According to Init7 boss Künzler, he no longer has 100 Gigabits per second that can be delivered to his customers in many places, but only 10 Gigabits at most. Künzle said that the introduction of new technologies has also become more and more difficult, because it is necessary to innovate for multiple customers at the same time.

Swisscom put forward a series of arguments, arguing that not only the network construction cost is much lower, but for example, the newly selected P2MP network structure corresponds to the technology used all over the world. However, Weko also believes that Swisscom has deviated from the agreed standard in terms of the expansion of its optical fiber network. It filed a lawsuit against Swisscom and ordered preventive measures in December 2020 to prohibit Swisscom from expanding the topology on the basis of the P2MP network.

Swisscom appealed this to the Federal Administrative Court. However, at BVGer, Swisscom was backing out at the end of September 2021. Weko ordered to ensure that the precautions for layer 1 access when Swisscom expands the FTTH network are legal. According to BVGer, Swisscom's implementation of its new network construction strategy is a technical limitation. Swisscom once again appealed this decision and is now appealing to the Swiss Supreme Court of the Federal Supreme Court (BGer). Swisscom called for postponement of measures so that it can continue to operate its fiber optic expansion. The irreparable financial and reputation losses are serious.

But last week, the telecommunications company also lost because of a complaint to BGer. Swisscom's request for suspension of validity was rejected by the court.

Swisscom now emphasizes that BGer's judgment on the legality of the preventive measures ordered by Comco is still awaiting. Swisscom CEO Urs Schaeppi said: "Currently and in the future, four optical fibers are being built from nearby shafts to apartments." However, the roundtable never decided that in this quarter each customer would also need four optical fibers from the connection center to the axis. .

In addition, “all competitors can use our network at full bandwidth and design their own products through so-called layer 3 access,” he said. According to Weko and the court's decision, he saw "his own goal in network expansion". "If P2P is specified for us, fiber expansion will be stagnant and rural areas will fall behind." said the boss of Swisscom.

On the other hand, Fredy Künzler from Init7 "Of course I am very pleased to take a further step towards a monopoly-free Internet in Switzerland. We regret that the expansion of optical fiber has been delayed in some places, but it is tolerable in the overall context. "For him, "this whole process is also about economic significance." He calculated that the use of broadband connections in uncompetitive rural areas is about 20 francs (currently 19.20 euros) higher per month than in competing cities. "In addition, the bandwidth achieved is much worse," Künzler said. Calculating the 30-year service life of all Swiss households and fiber optic infrastructure, 18 billion francs will be lost at the end of the economy.

The more obvious consequences of the dispute over the "correct" fiber access technology in Switzerland cannot be truly foreseen at this time. Weko's survey of Swisscom is expected to be completed in 2022. The final judgment of the Federal Court is still awaiting. According to Swiss media reports, it may take several years to make a final decision.

The established P2MP network may no longer be sold initially. For example, the project partnership between Telco Salt and Swisscom, the third largest in Switzerland, was put on hold.

André Klaus, head of the merged Sunrise UPC, Switzerland's second largest telecommunications company, criticized the news agency AWP on Friday and supported Swisscom. He criticized Weko, which prevented Swisscom's network expansion based on the single-fiber model. Krause said that from an economic point of view, the single-fiber P2MP model is a suitable network architecture for sparsely populated areas in Switzerland.

If Swisscom had to switch back to a four-core architecture, it would not help anyone. Ultimately, the additional cost must be paid by the end customer, who will not benefit from the P2P model.

Krause said the only advantage is that there is a continuous first-tier product. However, Weko believes that the possibility of Swisscom's competitors launching their own products with layer 1 access is more important than the fastest spread of Swiss fiber. The past four-fiber model was defined as the standard by Weko. "You can argue whether you have ever agreed on standards," Klaus said.

Swisscom must now reach an agreement with Weko. To do this, they must submit a resale offer to the competitor, which contains technical alternatives corresponding to the Tier 1 offer, Krauss said.