Who are the players?
Written on 9:52 AM by ooe
The business model is quite interesting in that it defines a number of roles. The main ones being service providers and network providers. Network providers operate the network and service providers provide service to their customers. There is also a range of equipment suppliers supplying equipment to network providers, service providers and CPE (customer premises equipment) to the customers. The content provider owns the content and strikes an agreement with the service provider that enables the service provider's customers access to the content provider's content. Finally there is Oftel, who ensure that the whole process operates fairly and for the overall benefit of the consumer.
It would be quite simple, apart from the fact that network providers offer a portfolio of products. The reasons for this are twofold: first, by offering a portfolio of products, the potential market place is increased, and second it needs to meet the Oftel requirement for competition. In essence, Oftel's stance is that for consumers to have adequate choice, quality and value for money, there is a need to offer connection at a number of levels. More details of the products offered by BT to meet this requirement are covered in the subsequent section. The implication of this position is that the UK probably has the most open broadband market in the world.
As a network provider, BT offers wholesale products that are aimed either at service providers or at other network providers. Other network providers who see a potential market place may wish to buy some, all, or none of its network capability from BT. They would also be able to buy network capacity from another source. This means that service providers can then buy from a portfolio of products, not just from BT, but from all network providers. It is also worth pointing out that is quite possible for a single company to operate both as a network operator and a service provider. Hence they may chose to buy one product from BT, connect into their own network and provide service to their own customers.
There are around 200 service providers registered in the UK each trying to focus on a particular bit of the market. Some are focused on provision of video-based services while others focus on provision of PC based services. Some target the business market while others target the residential market. BT has its own service provider organisation that can retail broadband products in competition with other service providers. Hence although BT does have a route from network provider to the customer, it is also in competition with other network and service providers. It should, however, be noted that a competitor to BT as a network or service provider might also be a BT customer through the purchase of other network products.
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