Swisscom and EWZ battle for Zurich

Posted by Lucy Berridge Thursday, May 21st, 2009

Add a comment

Swisscom launched trials over its own FTTH network in Zurich in April. Its rivals have long-said that its decision to invest heavily in FTTH now is a reaction to activity from the utility companies and the incumbent has conceded as much. Without the competitive pressures from the utility companies and its main rival Cablecom, it would have tried to maximize the investment from its VDSL network before moving to FTTH.

The incumbent does not do things by halves. It has one of Europe’s most extensive VDSL networks which covers 80% of the population and plans to deploy FTTH to 30% of the population by end-2015. In Zurich, Swisscom will trial a 50Mbps triple-play ahead of a commercial launch planned for the beginning of 2010 at the latest.

For the time being it will be in direct competition with the open-access muni-fiber development Zurinet, backed by the city’s energy company EWZ. Zurinet is the only FTTH network of any scale in Switzerland to date, with 9,000 homes passed by early May and a target of 15,000-18,000 for the year-end. Zurinet already counts the leading alternative players Orange and Sunrise among a group of service providers which EWZ says will number 11 by the year-end.

EWZ says the development of parallel fiber infrastructures would be a waste of resources but until recently has not shown much willingness to cooperate with Swisscom, maintaining that the Fibre Suisse model will increase the incumbent’s dominance rather than increasing competition.

Lately, however, the City of Zurich has started discussions with Swisscom about standardization and “synergies in engineering” and expects to make some sort of announcement before the summer holidays.

Interestingly EWZ recently agreed to deploy four fibers in buildings owned by certain housing associations but will retain its one-fiber model elsewhere. The Fibre Suisse plan is built on four fibers, one to be used by the incumbent and the remainder rented to other providers, which its opponents say goes against the true open-access model.

Swisscom has already reached cooperation agreements with several energy companies including Groupe E in Fribourg and EWB in Berne. IWB says it has agreed to work with Swisscom on a rollout in Basel.  Earlier this month EWZ announced a cooperation agreement with St Gallen, under which the two cities will work together on standardization and network quality. Services Industriels de Geneve, EWM (Meilen) and Winterthur municipality are discussing a similar collaboration with EWZ.

Whatever the outcome of Swisscom’s and EWZ’s discussions, at least the debate on standardization is moving forwards, driven by the operators and the regulator which has already held three round tables on FTTH and is planning a fourth this fall.