Wholesale access requirements are evolving as more consumers and businesses embrace broadband and data services. To compete effectively, market entrants need new access products that let them invest in network capabilities incrementally, gain technological independence and create compelling service offers.
Network operators need new access products, too. They need to provide wholesale access to market entrants that meet the terms of regulatory and competition authorities. But their access products must remain technologically and economically viable.
As bandwidth demand grows and regulators impose more ambitious targets, operators are looking beyond physical unbundling and legacy bitstream products to identify sustainable new ways to wholesale their networks.
Wholesale access scenarios
Wholesale access products can serve many purposes. Operators can seek commercial advantage by extending wholesale access products into regions with little or no competition. Or, they can form partnerships with public authorities that want to offer broadband services. But the most common use case for operators is regulatory fulfillment.
Regulators may impose mandatory wholesale access products, or work with network operators to:
- Provide alternatives where physical unbundling is not technically feasible, economically viable, or where the business case is unsustainable.
- Provide alternatives where unbundling is detrimental to the performance of key access technologies such as VDSL2 vectoring and G.fast.
- Encourage service-based competition or increase the variety of service offerings available to consumers.
- Spur investment in new infrastructure and facilitate the creation and delivery of innovative service offers.
- Stimulate the provision of cross-border and cross-operator services with guaranteed quality levels, such as high-grade services for business users.
Limitations of traditional wholesaling strategies
Regulators have long relied on physical unbundling and legacy bitstream access products to encourage competition. Both options provide useful service, but both also have limitations that reduce their effectiveness in networks built for high-bandwidth applications and increasingly demanding users.
For example, incompatibility issues arise when physical unbundling is combined with vectoring, which boosts network performance by canceling the “crosstalk” between lines in a bundle. Vectoring requires simultaneous management and co-ordinated operation of all of these lines.
More challenges emerge when physical unbundling is required deep in the network. Allowing access to copper lines in more locations, and in locations increasingly close to customers, is complex, time consuming and expensive for operators.
Legacy bitstream products can only offer best-effort internet connectivity. Access seekers can run any service on top of these connections, but without performance guarantees. This makes it difficult for them to win over businesses and consumers that want dependable high-grade services. And for access providers unable to offer guarantees, commercial potential is limited.
A new generation of wholesale access products
Wholesale access products need to be compatible with new high-bandwidth networking technologies — from vectoring and G.fast to fiber and beyond. These products must adapt to changing regulations, offer meaningful performance guarantees and give all parties a fair chance to differentiate their offers and compete for business.
A new generation of virtual access products allows network operators to wholesale their networks at the at the Ethernet or IP layer. Controlled by a single provider, these service-agnostic products deliver levels of simplicity, dependability and flexibility that aren’t possible with legacy bitstream and physical unbundling. They level the playing field by supporting service level agreements (SLAs), quality assurance and monitoring, and by allowing access seekers to choose different levels of interconnection and quality for different services.They also allow points of interconnection (POIs) to be consolidated for easier management.
Figure 1 shows various bitstream options available to the provider.
Figure 1. Bitstream Variants. Note that an additional higher level of interconnection can be offered at international exchange level. This allows Access Seekers to reach out to users of remote (= non-directly connected) Providers via intermediate connectivity solutions. This is beyond the scope of this TechZine article.
Ethernet-level wholesale access products Virtual unbundling allows network operators to provide access at Ethernet-level protocol (layer 2). It partially virtualizes the network by providing an active access link to the customer premises over copper or fiber at local exchange level. The access seeker doesn’t control the physical lines, but can control some of the capabilities of the connections supported by these lines.
Next-generation bitstream also allows operators to provide access at layer 2. It bundles a copper- or fiber-based access link to the customer premises with a backhaul service to points of interconnection (PoIs) at the edges of the operator’s aggregation network. The operator aggregates and offers connectivity to subscriber lines at local exchange, metro, regional or national points of presence. The contention ratio is established through an agreement between the access provider and access seeker
IP-level wholesale access products IP-level bitstream allows network operators to provide access at layer 3. It supports SLAs and all services except layer 2 transparency. With IP-level bitstream, the provider manages end-user configuration and routing, allowing the access seeker to focus on offering attractive applications. As with Ethernet-level wholesale, the contention ratio is agreed upon between the access provider and access seeker. The level of PoIs is flexible and typically determined by the first routing stage in the provider’s network.
Layer 2 or layer 3: Making the choice
The choice between Ethernet- and IP-level wholesale products involves a tradeoff for seekers and providers. The party that assumes responsibility for layer 3 gets more flexibility and control but takes on more complexity. In choosing an approach, the network operator must determine how much routing is required within and beyond its own network. It must also assess the scalability of routing exchanges and subnetting within its own network as well as interconnections with other networks.
Most network operators will prefer to offer Ethernet-level wholesale access products and remain fully transparent at layer 3. With Ethernet-level products, the wholesale operator can focus on providing layer 2 connectivity between end users and POIs and avoid doing any routing on behalf of the access seeker. The seeker has full control of end users but must perform all IP-level configuration and routing tasks. On the other hand, smaller access seekers might prefer a layer 3 solution to avoid this complexity. In that sense, IP-level wholesale reduces the barrier to entry for smaller access seekers.
Some services will demand a layer 2-based approach. For example, VPNs for business services require end-to-end transparency at layer 2. Multicast IPTV broadcasts are best offered over layer 2 networks. Additional features are needed to avoid conflicts that would arise if a layer 3 approach is used as such. Some multicast streams will have the same source or group address but be distributed into different networks.
Building new wholesale access products
Network operators can build compelling virtual access products by leveraging existing protocols and mechanisms and taking advantage of tools already in their networks.
Operators must support these products with an OSS framework that can handle exchanges with access seekers regarding end-user provisioning and profile configuration. Some additional homework will tell operators what kinds of SLAs they can sell based on the network capabilities they can offer.
The move toward wholesaling does require consideration of access seekers’ requirements in several key areas, including:
- Unicast connectivity — The product must allow the access seeker to reach any user with a predetermined packet format. It must also provide scalability, transparency, control of user-to-user connectivity, security, data integrity and separation between users and seekers.
- Multicast connectivity — The product must be scalable and allow the seeker to reach any user. The product must be able to replicate a single stream to serve multiple users and support the seeker’s chosen multicast IP addressing scheme.
- QoS and contention — The product must offer QoS awareness, an ability to differentiate between different traffic classes and a range of SLA guarantees and monitoring capabilities. It must not discriminate between access seekers or allow contention in cases where the sum of individual services fits within the capacity of the supporting equipment.
- Management — The product must allow the access seeker to manage users and subscription profiles, generate bills and get relevant information on faults, alarms and troubleshooting steps.
Complying with regulations
New wholesale access products must also comply with the requirements of national regulatory and competition authorities. Network operators can meet their obligations to regulators and access seekers by ensuring that their wholesale products provide:
- Transparency — Adhere to published key performance indicators and provide effective mechanisms for enforcement and monitoring.
- Equivalent conditions of access — Offer capabilities comparable to those offered by the access provider’s retail division and on equal terms and conditions.
- Non-discriminatory access — Safeguard competition by ensuring that all access seekers have access to the same technical features, pricing and parameters.
- Procedures for migrating to next-generation access — Offer a migration procedure in cases where the operator plans to change network topologies or move from physical unbundling to virtual access products.
- Fair pricing — Where regulations demand it, ensure that access seekers can match network operators’ pricing offers if they wish to.
Wholesale access regulations can vary among regions and countries. It’s essential for network operators developing wholesale access solutions to understand how these variations affect product requirements and ensure that they are addressed in specification and development processes.
Creating a sustainable competitive landscape
The new generation of Ethernet- and IP-level wholesale access products lets access seekers and providers compete on fair terms in any regulatory environment to provide services to consumers, businesses and public administrations.
These products offer a degree of control comparable to what’s possible through physical unbundling. But they surpass traditional access products by making it easier for network operators to offer attractive features and SLAs to access seekers under transparent and non-discriminatory terms.
By embracing these new products, network operators can comply with regulations with less effort while giving access seekers all the tools they need to differentiate their offers.
-  Wholesale access: A “product” refers here to a product sold by a network operator (Access Provider) to a “market entrant” (Access Seeker such as ISP, others ...). It is not referring to a specific physical product such as access or edge nodes.
-  Virtual access: Virtual access is a term used for access seekers who rely on infrastructures of network providers to connect to their own customers. Virtual access is another term for wholesale access and encompasses several products such as virtual unbundling, next-generation bitstream and IP-level bitstream.
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