Berne, 27 November 2007
On 1 April 2007, the revised Telecommunications Act (FMG) and associated implementation provisions came into force. This saw the unbundling of the last mile become a reality in Switzerland. Since the legislation came into force, Swisscom has been offering its competitors, the alternative providers, five new access services as prescribed by law. Swisscom negotiated with some 30 alternative providers, and 20 companies have signed a total of 45 contracts with us, in part subject to pricing. Other contracts are close to being finalised.
The most sought-after service is the joint usage of telephone exchanges (co-location): the current state of play is that Swisscom has granted access to alternative providers at 160 locations in around 100 telephone exchanges. Co-location allows alternative providers to operate their own systems in a Swisscom telephone exchange. They can make use of the Swisscom infrastructure (room, area, energy, handover distribution frame etc.) and offer their customers their own products and services, such as broadband connections. The first joint usage locations have been operational since July. Around two-thirds of the locations have been set up in the major centres of Zurich, Basel, Geneva and Lausanne. The remainder are divided among 12 further cities (especially Lucerne, Berne, Biel and Bellinzona). More than a million subscribers are accessible from the 160 joint usage locations. Moreover, Swisscom has for years been offering its competitors attractive reseller offers, the latest being DSL broadband access without the traditionally coupled fixed network connection (Naked DSL).
In the last few months, our cooperation with our competitors has been characterised by intensive contractual negotiations, courses, technical discussions and handovers in the exchanges. Unbundling of the local loop is being carried out in all regions of Switzerland.
The Sion exchange was the first to be unbundled on 31 July by the company VTX. Francis Cobbi, co-CEO of VTX, commented on the project as follows: "Everything will go very quickly at first. By the end of this year, more than 20% of our customers will be able to benefit from the new offers. As the pioneering company, we came up against some teething problems: the exchanges hadn't been sufficiently prepared and we lost time as a result. Thanks to the constant dialogue with Swisscom, the situation improved and we will be able to achieve our goal of 50% coverage by mid-2008. We do, however, regard the price charged for service access as being too high and anticipate that the regulator will agree with our position."
More than 300 Swisscom employees have been involved in the project to develop and provide the new regulated offers, and Swisscom has invested more than CHF 60 million in the project. This made it possible to handover the first exchange only three months after the amended Telecommunications Act came into force.
The Telecommunications Act prescribes cost-based charges calculated on the basis of the LRIC (long run incremental costs) method for unbundling, which are charged to the competitors for their usage. These costs must be in line with the expenditure and investments of an efficient operator setting up a similar network from scratch. This method takes into account the current infrastructure competition in Switzerland and is designed to enable other providers to invest effectively.