Assessment of the technicalities of VULA products in the context of a state aid investigation : expert opinion.
Date: 2018-11-24
Institutions: Directorate-General for Competition
Subjects: Germany, State aid, control of State aid, information technology industry, technical standard, transmission network

Assessment of the technicalities of
VULA products 

in the context of a

State aid investigation

Expert opinion

Competition

Prepared by

EUROPEAN COMMISSION 

Directorate-General for Competition  
E-mail: comp-publications@ec.europa.eu  

European Commission 
B-1049 Brussels 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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Assessment of the 
technicalities of VULA 
products in the context of a 
State aid investigation 

Expert opinion, Version 2 

 
  
 
 
 
 
 
 
     
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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Luxembourg: Publications Office of the European Union, 2018 

Catalogue number: KD-04-18-126-EN-N  
ISBN 978-92-79-79903-7 
doi: 10.2763/342502 

© European Union, 2018 
Reproduction is authorised provided the source is acknowledged.  
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Prepared by: 

Ilsa, Godlovitch, Director WIK, Brussels Office 

Dr. Thomas Plückebaum, Director WIK, Networks and Costs 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Technicalities of VULA products 

Contents 

List of figures 

List of tables 

I.  Abstract 

II.  Executive Summary (English) 

III. Executive Summary (German) 

Abbreviations 

1  Introduction and methodology 

1.1  Objectives of the study 

1.2  Methodology 

1.3  Structure 

2  Defining metrics for VULA 

2.1  The EC Decision (2014 Relevant Market Recommendation explanatory note) 

2.2  The BEREC definition 

2.3  EC statements regarding German VULA submissions 

2.4  Metrics for assessing VULA specifications 

3  VULA in Austria, Denmark and the U.K. 

3.1  Methodology 

3.1.1  Country selection 

3.1.2  Interview process and questionnaire 

3.2  Background to the VULA offerings in Austria, Denmark and the UK 

3.3  Overview of specifications 

3.4  Point of handover 

3.5  Generic access 

3.6  Access seekers’ control 

3.7  Migration 

3.8  Pricing 

4  Best practice VULA 

4.1  Point of local handover 

4.2  Generic access 

4.3  Access seeker’s control 

4.4  Migration 

4.5  Price 

IV 

V 

1 

2 

9 

17 

21 

21 

22 

23 

24 

25 

26 

27 

28 

31 

31 

31 

35 

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40 

42 

43 

46 

48 

51 

52 

54 

64 

66 

68 

I 

 
Technicalities of VULA products 

5  VULA in Germany 

5.1  Relevant Network architecture of the incumbent in Germany 

5.1.1  FTTC and FTTC Vectoring 

5.1.2  BNG network architecture 

5.2  Regulatory environment for virtual unbundled access substituting physical  

unbundling 

5.3  Cabinet VULA 

5.3.1  Submitted DT product 

5.3.2  Other DT cabinet VULA products 

5.3.3  Submitted NetCologne product 

5.3.4  Submitted DNS:NET product 

5.3.5  Interim Summary 

5.4  Layer 2 Bitstream 

6  Implications of FTTC/VDSL and vectoring for competition in German market 

6.1  Commitments regarding network access 

6.2  Physical unbundling – the counterfactual 

70 

70 

70 

77 

79 

82 

83 

88 

88 

92 

96 

98 

102 

102 

103 

6.3  Technical and economic implications of FTTC/VDSL for physical unbundling  107 

6.3.1  Implications for unbundling at the MDF 

6.3.2  Unbundling at the street cabinet 

6.3.3  Implications for VULA handover in the German market 

6.4  Technical and economic implications of FTTC/VDSL with vectoring for  

physical unbundling 

6.4.1  Impact of vectoring on speed and availability of high capacity broadband 

6.4.2  Technical implications of vectoring for physical unbundling 

6.4.3  Alternatives to vectoring that would permit unbundling 

107 

109 

110 

111 

111 

112 

115 

6.4.4  Implications of alternative solutions to 17a vectoring in the German context 

116 

7  Conclusions and recommendations 

Annex 1 – Questionnaire: VULA characteristics, importance and degree of  

satisfaction 

Annex 2 – Country interviews 

Austria 

RTR interview VULA specifications 22 December 2016 

Tele2 Austria interview VULA specifications 10 January 2017 

Denmark 

DBA interview VULA specifications 9 January 2017 

Telenor Denmark interview VULA specifications 9 January 2017 

Germany 

II 

118 

122 

124 

124 

124 

128 

130 

130 

132 

136 

 
Technicalities of VULA products 

BNetzA interview VULA specifications 10 January 2017 

United Kingdom 

Ofcom interview VULA specifications 21 December 2016 

Talk Talk interview VULA specifications 10 January 2017 

International operator 

Vodafone interview VULA specifications 22 December 2016 

136 

139 

139 

142 

145 

145 

III 

 
 
 
Technicalities of VULA products 

List of figures  

Figure 3-1 

Figure 3-2 

Figure 3-3 

Figure 3-4 

Figure 4-1 

Figure 4-2 

VULA take-up in U.K., Denmark and Austria 

Copper LLU and FTTC/FTTP VULA monthly rental UK 2017 

Austria VULA charges 2016 and May 2017 

Copper LLU and FTTC/FTTP VULA monthly rental Denmark 2017 

OSI seven layer reference model of communication protocols 

OSI communication interworking, layer per layer or peer-to-peer 

Figure 4-3 

OSI protocol sublayers, details 

Figure 4-4 

Protocol enveloping of Layer1 – 3 and additional Layer 2/3 address  
functions (VLAN tagging and MPLS) 

Figure 4-5 

Double-tagged Ethernet frame structure 

Figure 5-1 

xDSL bandwidth over line length 

Figure 5-2 

Figure 5-3 

Migration from pure copper access lines to FTTC 

DT’s FTTC access network architecture 

Figure 5-4 

Vectoring for crosstalk elimination 

Figure 5-5 

Bandwidth gain with Vectoring 

Figure 5-6 

Figure 5-7 

Figure 5-8 

Figure 5-9 

Figure 5-10 

Vectoring bandwidth increase over copper line length 

Bandwidth of VDSL2 Profile 35b with and without Vectoring  
compared to profile 17a with Vectoring 

BNG network architecture in Germany, principle 

DT’s wholesale access products in markets 3a and b 

Near shore and far shore area in a local access area in DT’s network in 
Germany 

Figure 6-1 

SLU handover points including cascaded and intermediate cabinets 

Figure 6-2 

LLU demand (in mio. lines) over time 

34 

48 

49 

50 

54 

55 

56 

57 

58 

71 

72 

73 

74 

75 

76 

77 

78 

80 

80 

104 

104 

IV 

 
 
Technicalities of VULA products 

List of tables 

Table 3-1 

Local bitstream/VULA obligations in Europe 

Table 3-2 

Interview partners 

Table 3-3 

Table 4-1 

Table 5-1 

Table 5-2 

Table 7-1 

Table 7-2 

Core VULA characteristics in U.K., Austria and Denmark 

Example of priority use in an Ethernet frame 

Overview three German cabinet VULA 

Comparision of best practice VULA characteristics between the  
submitted cabinet VULA products 

Main best practice VULA characteristics 

Comparison of the submitted VULA products against the VULA best  
practice characteristic of section 4 

32 

35 

38 

59 

82 

97 

119 

121 

V 

 
 
 
Technicalities of VULA products 

I. 

Abstract 

In June 2015, the Commission approved the provision of state aid to support the deployment 
of  high  speed  broadband  connections  in  Germany.  The  conditions  set  out  in  the  state  aid 
decision  require  an  approval  of  VULA  products  before  operators  are  permitted  to  use 
vectoring  technology  (or  other  solutions  which  impede  physical  unbundled  access)  in  the 
subsidised  areas.  In  September  2016,  Germany  submitted  three  VULA  products  to  be 
supplied by the operators DNS:NET, NetCologne and Deutsche Telecom.  

This  report  provides  an  expert  opinion  as  regards  whether  the  submitted  German  VULA 
products meet best practice standards as regards offering equivalent functionality to physical 
unbundling. In this context we (i) identify key VULA characteristics with reference to EC and 
BEREC  documentation;  (ii)  identify  ‘best  practice’  characteristics  with  reference  to  an 
analysis of VULA characteristics in Austria, Denmark and the UK; (iii) compare the submitted 
German  VULA  products  with  the  identified  best  practice  characteristics;  (iv)  draw 
conclusions  on  the  impacts  of  the  submitted  products  on  competition  with  reference  to 
counterfactual  cases;  and  (v)  make  recommendations  concerning  changes  needed  to  the 
submitted products in order to meet the requirement that they be functionally equivalent to 
physical unbundling.  

The results of the first version of the expert opinion had been exchanged with the state aid 
applicants,  giving  them  the  opportunity  to  improve  their  products  and  overcome  shortages 
recognized by the Commission. This led to clarifications and modifications of the suggested 
products for which ultimately a revised version was submitted. Basis of this version (2) of the 
expert study are the final contracts for state-aid VULA products of the three operators dated 
of July 31rst respectively August 2nd. Because none of the applicants now use contract and 
product describing documents with business secrets this report is free of any confidentiality 
restriction.   

1 

 
 
Technicalities of VULA products 

II. 

Executive Summary (English) 

Context 

In June 2015 the Commission approved the provision of state aid to support the deployment 
of high speed broadband connections in Germany1. The conditions set out in the state aid 
decision  require  an  approval  of  VULA  products  before  operators  are  permitted  to  use 
vectoring  technology2  (or  other  solutions  which  impede  physical  unbundled  access)  in  the 
subsidised areas.  

After  a  public  consultation  in  May  20163  in  September  2016,  Germany  submitted  three 
VULA  products  to  be  supplied  by  the  operators  DNS:NET,  NetCologne  and  Deutsche 
Telekom. 

DG  Comp  commissioned  WIK  to  undertake  a  study  to  support  them  in  evaluating  whether 
the  submitted  VULA  products  have  the  necessary  technical  characteristics  to  comply  with 
the  open  access  requirements  as  set  out  in  the  2013  Broadband  Guidelines  and  the 
explanatory  note4  on  the  Commission’s  2014  market  recommendations  (9.4.2014)5, 
including  the  requirement  that  VULA  should  be  functionally  equivalent  to  physical 
unbundling.  

In  this  study  we  (i)  identify  key  VULA  characteristics  with  reference  to  EC  and  BEREC 
documentation;  (ii)  identify  ‘best  practice’  characteristics  with  reference  to  an  analysis  of 
VULA characteristics in Austria, Denmark and the UK; (iii) compare the submitted German 
VULA products with the identified best practice characteristics; (iv) draw conclusions on the 
impacts  of  the  submitted  products  on  competition  with  reference  to  counterfactual  cases; 
and (v) make comments on submitted products’ characteristics and their extent to which they 
meet best practice expectations and are able to substitute physical unbundling respectively 
are a functional equivalent to it. 

When is VULA required? 

Virtual  unbundled  local  access  (VULA)  has  been  adopted  as  a  wholesale  remedy  in  many 
EU  countries  where  the  FTTx  architecture  and/or  technologies  deployed  by  the  SMP 
operator (typically the former incumbent) means that unbundled access to the FTTx network 
is not technically or economically feasible. The main cases where physical access becomes 
technically  or  economically  unviable  are  (i)  where  the  supplier  installs  FTTx  networks  in  a 
‘tree’ architecture (eg FTTC or FTTH/PON) which cannot be unbundled at or near the MDF 

  1   SA.38348 (2014/N), http://ec.europa.eu/competition/state_aid/cases/251861/251861_1670915_79_2.pdf 
  2   Vectoring  technology  eliminates  the  cross  talk  between  neighboring  copper  pairs  in  a  cable  binder  and 
thereby  enables  the  transmission  of  higher  speed  broadband  signals  over  copper  access  lines  than  other 
coding methods. 

  3   

http://www.bmvi.de/DE/DigitalesUndRaumentwicklung/Breitbandausbau/Breitbandfoerderung/Vectoring/VU
LAAnhoerung/vula-anhoerung_node.html  

  4   SWD(2014) 298 
  5   C(2014) 7174 final 

2 

 
                                                 
Technicalities of VULA products 

site; and/or (ii) where the supplier installs vectoring technology to increase the end-customer 
access speed. 

Why are the specifications for VULA important? 

A  core  challenge  with  VULA  (common  with  other  active  wholesale  products)  is  that,  in 
contrast  with  physical  unbundling,  the  choice  of  DSL  equipment,  technical,  bandwidth  and 
pricing characteristics of the wholesale product are determined by the access provider. This 
has an impact on the ability of access seekers to differentiate their retail product (in terms of 
bandwidth, pricing and quality), and monitor network operation and take appropriate action 
for repair.  

Best practice VULA characteristics 

the  explanatory  memorandum  accompanying 

In  accordance  with  the  EC  Broadband  state  aid  guidelines  and  Decision  on  the  German 
case6,  as  well  as 
the  EC  2014 
Recommendation  on  Relevant  Markets,  VULA  should  as  far  as  possible  be  functionally 
equivalent to physical unbundling. In technical terms this means that access should (i) occur 
locally;  (ii)  be  generic  and  provide  access  seekers  with  a  service-agnostic  transmission 
capacity  which  is  uncontended  in  practice;  and  (iii)  provide  access  seekers  with  sufficient 
control  over  the  transmission  network  to  allow  for  product  differentiation  and  innovation 
similar  to  LLU.  In  addition,  we  note  that  the  pricing  of  VULA  should  facilitate  its  use  in  a 
similar  manner  to  physical  unbundling;  and  effective  migration  processes  towards  VULA 
from  physical  unbundling  should  be  implemented  to  foster  take-up,  and  ensure  that 
competition  is  preserved  where  technological  solutions  force  a  migration  from  unbundled 
access to VULA. 

  6   See footnote 1 

3 

 
 
 
                                                 
Technicalities of VULA products 

Drawing  on  evidence  from  case  studies  and  interviews  we  further  recommend  that  a  ‘best 
practice’ VULA would have the following characteristics: 

Characteristic 

Best practice implementation 

Point of 
handover 

1.  VULA  should  be  available  at  least  at  the  MDF  level  of  network  hierarchy,  or  if  not 

feasible, a higher (regional) network level 

Generic access 

2.  The number of wholesale access seekers per handover location should not be limited 
3.  The  size  and  number  of  handover  interfaces  should  be  determined  by  the  capacity 

required by end-users of each access seeker.  

4.  A single interface should be available for all current and future VULA technologies and 

a single VULA product family should be defined 

5.  VULA should be offered through the layer 2 (Ethernet) protocol 
6.  A pure uncontended VULA should be available. This may be most achievable with MDF 
handover. If VULA is made available at the BNG, it should be offered in such a way that 
it could be dimensioned as uncontended7 

7.  10Gbit/s interfaces should be available as required to avoid contention at the handover 

interface 

8.  VLAN tagging should be available. There should be at least 4 VLANs per end customer 

with the potential for 8 as a reserve for future differentiation 

9.  The MTU (Message Transfer Unit) size should be at least 1580 Bytes 
10.  There  should  be  at  least  one  dedicated  logical  connection  per  customer  between  the 
handover interface and the CPE, and a unique customer ID which can be used by the 
access provider and access seeker 

11.  Multicast frame replication is not required at cabinet level, but should be offered at any 

level above 

Access seeker’s 
control 

12.  There  should  be  free  choice  of  the  end-customer’s  CPE  eg  via  a  whitelist,  with  the 

potential to apply for approval for further CPE 

13.  The  access  seeker  should  have  control  of  the  whole  technical  capacity  of  the  access 
line  –  bandwidth  control  and  traffic  prioritization  would  be  performed  by  the  access 
seeker alone 

14.  Ideally, access seekers should be able to operate or control their end-customer ports in 

an MSAN 

15.  Access seekers should be able to apply any security measures at layer 3 and above 
16.  Access seekers should have fault management capabilities through access to real time 
line state information and monthly line state reports. An availability criterion and a clear 
fault definition shall exist. 

17.  Compliance with service levels (SLAs) for provisioning and repair should be monitored 

through KPIs with automatic compensation if targets are not met 

18.  Access seekers should have control of the operational and business support processes 

19.  An early announcement and mutually agreed migration plan should be made 
20.  An automated process should be available for bulk forced migration 
21.  There should be specific KPIs applied for bulk migration with automatic compensation 

in the event that targets are not met 

22.  In  the  event  of  forced  migration,  there  should  be  compensation  for  stranded  assets 

valued at the net book value on the day of migration  

Migration 

Pricing 

23.  The  FTTC  VULA  price  should  be  cost-based  and  calculated  through  a  BU-LRIC+ 

methodology 

24.  For  uncontended  VULA,  a  single  price  should  be  calculated,  based  on 

the 

unconstrained bandwidth of the line (limited only by technical physical characteristics) 
25.  The price for contended VULA should reflect a cost-oriented share of the uncontended 

cost 

  7   For example, the Austrian VULA product is offered with a combination of guaranteed backhaul capacity and 

peak capacity to be shared between users in a fair and best efforts manner. 

4 

 
 
                                                 
Technicalities of VULA products 

An analysis of the submitted German products 

The  following  table  summarizes  the  main  characteristics  of  the  submitted  German  VULA 
products in the final revised versions against the best practice characteristics:  

Point of local handover

Handover location

No. of ANO per handover point

Number of handover interfaces

DT

KVZ-AP-F

cabinet
Two (solutions for 
expansion to be sought in 
case of demand)
Two 10G per MSAN for max 
448 ports (solutions for 
expansion to be sought in 
case of demand)

L2-BS

BNG

NetCologne

DNS:NET

cabinet

cab, BNG optional

unlimited

not limited

unlimited

one per BNG

10G per portcard for 48 ports 
each, expandable

10G for max. 192 ports, 
expandable 

One common VULA product family

declaration of intent

n, FTTC specific only

declaration of intent

declaration of intent

offered

no

offered

offered

max. 2,5 G uncontended

uncontended

1-10G interface, cont.

10G/ max 2,5 G

on demand, add. agreement

y

offered (in case of product 
specific approach)

n

offered (in case of product 
specific approach)

offered

no spec.

offered

Generic Access:

L2 Protocol

Upgrade backhaul capacity

10 G interface

VLAN tagging

No. of VLAN end customer

Max MTU size
Ded. connection per end-cust./ 
availability connection

Unique customer ID

Multicast frame replication

Access seeker’s control:

CPE: by ANO  resp. end-customer

Bandwidth control by ANO

Control of MSAN port parameters

Security: support for access seeker 
available

Fault management:

Real-time diagnosis and analysis

Clear fault definition

MTR targets/ KPI monitoring

Damage compensation
Sufficient control of operational 
support system (OSS) and business 
support system (BSS)

Migration:

Advance notification 

Bulk migration process

Migration KPI Monit./ compens.

Compensation of frustr. Invest

Price:

bottom-up regulatory costing

Uncont. price bandwidth indep.

Cont. below, share of uncont.

offered

uncontended

1-10G

offered

3,872

y

3,872

max. 1.950 Byte

max. 1.950 Byte

offered

offered

n

offered

offered

y/ y

n

n

y

stepwise, no symmetry

offered

offered

offered

offered

offered

na

forecast

n

n

unclear

unclear

na

no spec

n

n

n

offered

na

forecast

n

n

y

offered

4,094

1,580

offered

offered

offered

offered

offered

offered

offered

offered

offered

na

forecast

n

n

1-10G

offered

4,096

> 1580

offered

offered

offered

offered

offered

offered

offered

offered

offered

offered

offered

na

forecast

n

n

n, risk sharing model

y, oriented at reg. prices

no uncont. guarantee

unclear

y

na

y, oriented at reg. prices

unclear

All products contain positive features (green, meets best practice; yellow, facts still have to 
be  detailed  by  the  access  provider,  red:  does  not  meet  best  VULA  practice  as  defined  in 
section 4) over all relevant criteria, except the L2 bitstream access product which originally 

5 

 
 
Technicalities of VULA products 

has been included in the analysis because it was initially submitted by DT as a complement 
to its VULA-product.  

Our  analysis  of  a  "best  practice"-VULA  has  shown  that  from  a  technical  and  economic 
viewpoint  a  handover  location  at  a  network  level  above  street  cabinet  level  would  be 
important.  The  VULA  products  submitted  to  the  Commission  for  use  in  state  aid  areas  by 
DT,  DNS:NET  and  NetCologne  offer  handover  at  the  street  cabinet  only.  In  Austria, 
Denmark and the UK, VULA is not offered exclusively at the street cabinet level, but at the 
MDF  site  and/or  at  locations  aggregating  a  number  of  MDF  sites.  As  further  discussed 
below, handover at a location similar to the MDF site is important to ensure that there is a 
large  enough  addressable  customer  base  to  make  access  economically  viable  while  also 
enabling  access  seekers  to  make  maximum  use  of  their  own  backhaul  facilities.  On  the 
positive side, all street cabinet VULA products submitted make utmost use of the technical 
and  physical  characteristics  of  the  access  lines  in  order  to  provide  highest  possible 
bandwidth and thus product definition freedom regarding bandwidth.  

Two  of  the  operators,  DT  and  DSN:NET  also  offer  layer  2  wholesale  products  at  a  BNG 
handover  location.  This  handover  point,  which  is  at  a  similar  level  to  the  ‘parent  nodes’  at 
which VULA is made available in the UK, do provide a more suitable handover location than 
the street cabinet. However, in including such products within the Wholesale Central Access 
market,  rather  than  the  Wholesale  Local  Access  market  in  which  physical  unbundling  is 
mandated, German NRA BNetzA has not recognized that these products may substitute for 
physical  unbundling.  The  specifications  of  DT’s  BNG  products  also  fall  short  of  the  best 
practice  VULA  criteria  as  identified  in  this  report.  Key  areas  where  the  BNG  product 
submitted by DT would not meet best practice as regards VULA standards are that:  

•  There is no clear information concerning which access areas may be accessed from a 

specific BNG. A unique handover per BNG location is not offered. 

•  The  product  is  for  the  moment  technologically  specific,  and  therefore  there  is 
uncertainty  regarding  the  treatment  of  VULA  access  over  FTTH  GPON  or  other 
technologies for which physical unbundling would be challenging 

•  Access seekers do not have full control over the technical and physical characteristics 
of the access line. They must choose from amongst pre-defined bandwidth steps 

• 

In  the  submitted  application,  there  are  no  guarantees  or  transparent  contention 
planning rules, or any other means that guarantee backhaul bandwidth control as is 
best practice for contended or uncontended VULA.  

•  The VLAN tagging approach in principle is in line with best practice VULA, but limits 
the access seeker’s address space to a maximum of 3 872 end-customers, which 
is quite low for a handover at the regional level.  

6 

 
Technicalities of VULA products 

•  Multicast frame replication is not supported, which would be a significant issue for 

VULA with a BNG handover 

•  Fault  definitions  are  not  clearly  specified.  Maximum  committed  fault  repair  times 
there  are  no  provisions  for  KPIs  to  allow  monitoring  and 

are  set,  but 
compensation for failing to meet the targets is not offered8. 

•  Although it may not be expected to be relevant in the German market in case of state 

aid9, no automated processes have yet been defined for bulk migration. 

As  regards  pricing,  BNetzA  notified  its  pricing  proposal  for  the  L2  bitstream  access  (at  the 
BNG  level)  to  the  EC  on  18.  November  2016.  The  prices  came  into  force  22.  December 
201610. Although flat rate pricing has been applied for lines upgraded with VDSL vectoring, 
there is a cap on bandwidth to be supplied via VDSL vectoring (of up to 100Mbit/s11) 
and  a  total  sum  traffic  restriction12  at  the  backhaul  connection  and  the  handover 
interface, which is not consistent with best practice VULA pricing. 

Implications of FTTC/VDSL and vectoring for competition in German state aid areas 

The technology planned to be deployed for many state aid areas in Germany is FTTC/VDSL, 
in  many  cases  in  combination  with  vectoring.  Vectoring  is  a  technology  which  minimizes 
cross-talk between lines within a cable. It can enable higher bandwidths to be achieved than 
FTTC/VDSL in the absence of vectoring. It can also extend the reach of higher bandwidths. 

FTTC/VDSL  in  combination  with  vectoring  could  contribute  to  achievement  of  the  Digital 
Agenda for Europe (DAE) targets at less expense than through the deployment of FTTH/B. 
However,  there  are  two  features  of  the  planned  technological  solutions  for  state  aid  in 
Germany  that  would  create  challenges  for  the  ongoing  usage  of  physical  unbundling,  and 
therefore impede existing access-based competition. 

1.  The  planned  deployment  of  FTTC/VDSL  would  mean  that  –  for  the  higher  speeds 
funded  through  state  aid  –  there  would  no  longer  be  a  unique  physical  connection 
between the end-user and MDF site. Physical unbundling at the MDF site (the site at 
which  physical  unbundling  predominantly  takes  place  today)  would  therefore  no 
longer be possible for the higher capacity connections. 

  8   While this is ensured for the KVz-VULA in case of state aid, it is not offered by DT in general for all vectored 

wholesale access products.  

  9   They  are  relevant  in  case  of  the  Vectoring-II  decision,  Vectoring  in  the  near  shore  areas.  Enforced  bulk 
migration should not occur in state aid cases, where the operator is the first supplier of broadband access in 
the area. 

  10   BNetzA press notice of 21.December 2016, 

https://www.bundesnetzagentur.de/SharedDocs/Pressemitteilungen/DE/2016/161221_Bitstrom.html?nn=71
2782 

  11   BK3-15-003_2. Teilentscheidung, II. Anhang A – Leistungsbeschreibung L2_BSA_VDSL, II.1. Ziffer 1.1 
  12   BK3-15-003_2.  Teilentscheidung,  V.  Anhang  A  –  Leistungsbeschreibung  L2_BSA-Transport  und  L2-

Übergabeanschluss, V.1. Ziffer 3 

7 

 
                                                 
Technicalities of VULA products 

2.  Because vectoring requires information to be shared across all lines in a cable, it is 
not  currently  compatible  with  local  loop  and  subloop  unbundling  and  competition  in 
VDSL.  LLU  from  the  MDF  may  still  be  used,  but  with  limitations  on  available 
frequencies and bandwidth.  

The  submitted  street  cabinet  VULA  products  propose  to  address  the  competition  concerns 
arising from the technical impacts of vectoring on unbundling. However, they do not offer a 
substitute  for  the  form  of  unbundling  which  is  in  widespread  use  in  Germany  today  –  ie 
physical  unbundling  at  the  MDF  site  (LLU).  Rather,  they  would  require  access  seekers  to 
deploy fibre closer to the end-customer, up to the street cabinet.  

Available  evidence  including  the  limited  take-up  of  access  at  the  street  cabinet  (subloop 
unbundling SLU) and cost-modelling exercises conducted by Analysys Mason13 and WIK14,  
suggests  that  it  would  not  be  economically  viable  for  access  seekers  to  extend  their 
networks from the MDF site, where they are currently located, to the street cabinet, because 
the number of addressable customers at this point is considerably less than at the MDF site, 
and would be especially limited in the rural areas likely to be subject to state aid. Moreover, if 
only VULA and not physical access (subloop unbundling) is available at the street cabinet, 
alternative  operators  would  also 
flexibility  and 
differentiation, which would make it less attractive still.  

face  some  restrictions  on  product 

We  examined  various  alternative  solutions  to  assess  whether  they  could  enable  higher 
bandwidths to be achieved while retaining the benefits of physical unbundling. Multi-vendor 
vectoring solutions which would enable FTTC/VDSL competition on the basis of SLU have 
been announced, but are not as yet deployed in practice. They would also not of themselves 
enable physical access to be provided to the upgraded FTTC/VDSL vectored network at the 
MDF site or equivalent. 

Using  VDSL  Profile  35b  (without  Vectoring)  would  allow  some  capacity  increases,  while 
permitting unbundling at the location of VDSL equipment (either MDF site or street cabinet). 
However, this solution would not allow alternative operators to implement VDSL at the MDF 
site  in  areas  where  FTTC  has  been  deployed  and  VDSL  has  been  installed  at  the  street 
cabinet with state aid, because the cabinet based MSAN will suppress the MDF based line 
signals because of the significantly higher sending power.  

Implementing VULA solutions at the MDF and/or BNG site in accordance with the proposed 
best practice characteristics are therefore likely to be the most relevant solutions to ensure 
continued  competition  in  cases  where  state  aid  is  approved  for  the  deployment  of  network 
architectures or technologies, which are not compatible with physical unbundling.  

  13   Analysys: The business case for sub-loop unbundling in the Netherlands, OPTA, January 2007 
  Analysys: The business case for sub-loop unbundling in Dublin, ComReg, 20. December 2007 

  14   WIK: The economics of next generation access, 2008/ 2009, WIK: Implications of a nationwide fibre roll out 
and its subsidy requirement, wik, Bad Honnef, October 2011, WIK: Der dynamische Investitionswettbewerb 
als  Leitbild  der  zukünftigen  Entwicklung  des  Telekommunikationsmarktes,  November  2013,  WIK:  Benefits 
and  regulatory  challenges  of  VDSL  vectoring  (and  VULA),  Florence  School  of  Regulation,  March  2014, 
Florence, EUI Working Papers RSCAS 2014/ 69 

8 

 
                                                 
 
Technicalities of VULA products 

III. 

Executive Summary (German) 

Ausgangssituation 

Im  Juni  2015  hat  die  Kommission  das  beantragte  Vorhaben  über  die  staatliche 
Förderung  des  Breitbandausbaus  in  Deutschland15  genehmigt.  Eine  notwendige 
Bedingung in dieser Beihilfeentscheidung ist die vorherige Überprüfung und Akzeptanz 
eines  Wholesale  Zugangsproduktes 
lokalen 
Teilnehmeranschlusses  (VULA),  bevor  die  Beihilfeempfänger  in  den  geförderten 
Gebieten die Vectoring Technologie16 einsetzen dürfen.    

virtuell  entbündelten 

für  den 

Im Anschluss an die öffentliche Anhörung des Marktes im Mai 201617 übermittelte die 
Bundesregierung  Deutschland  der  Kommission  im  September  2016  drei  VULA 
Produkte  der  Netzbetreiber  DNS:NET,  NetCologne  und  Deutsche  Telekom  zur 
Überprüfung. 

Die Generaldirektion Wettbewerb der Kommission beauftragte WIK mit einer Studie zu 
ihrer  Unterstützung  in  der  Bewertung  der  übermittelten  Produkte,  inwieweit  diese  die 
notwendigen  technischen  Eigenschaften  besitzen  so  dass  sie  die  Anforderungen  an 
einen  offenen  Netzzugang  erfüllen,  die  in  den  Breitband  Leitlinien  von  2013  und  den 
Erläuterungen18  zur  Märkte-Empfehlung  der  Kommission  (vom  9.4.2015)19  gefordert 
werden,  einschließlich  der  Forderung,  dass  ein  VULA  funktional  gleichwertig  zu  einer 
physischen Entbündelung des Teilnehmeranschlusses sein muss.  

In dieser Studie identifizieren wir (i) die Kerneigenschaften von VULA in Bezug auf die 
Dokumentation  der  Kommission  und  des  BEREC;  (ii)  vorbildliche,  dem  Stand  der 
Technik  und  des  Marktes  entsprechende  Eigenschaften  von  VULA  unter  Auswertung 
der Eigenschaften der VULA Produkte aus Österreich, Dänemark und Großbritannien; 
und vergleichen (iii) die übermittelten Deutschen VULA Produkte mit den identifizierten 
vorbildlichen  Eigenschaften;  wir  ziehen  Rückschlüsse  aus  (iv)  Auswirkungen  der 
übermittelten  Produkte  auf  den  Wettbewerb  unter  Bezug  auf  hypothetische 
kontrafaktische  Fälle;  und  (v)  kommentieren  die  Eigenschaften  der  übermittelten 
Produkte  und  das  Ausmaß,  in  dem  sie  den  Erwartungen  aus  der  Best  Practice 
Untersuchung erfüllen und die physische Entbündelung ersetzen bzw. ein funktionales 
Äquivalent dazu darstellen können. 

  15   SA.38348 (2014/N), 

http://ec.europa.eu/competition/state_aid/cases/251861/251861_1670915_79_2.pdf 

  16   Vectoring eliminiert das Nebensprechen zwischen benachbarten Kupferpaaren in einem Kabelbinder 
über 

ermöglicht 
die  Übertragung 
Kupferanschlussleitungen als andere Kodierverfahren ohne Vectoring.  

von  Signalen  mit 

höherer  Bandbreite 

dadurch 

  17  http://www.bmvi.de/DE/DigitalesUndRaumentwicklung/Breitbandausbau/Breitbandfoerderung/ 

Vectoring/VULAAnhoerung/vula-anhoerung_node.html 

  18   SWD(2014) 298 
  19   C(2014) 7174 final 

9 

 
                                                 
Technicalities of VULA products 

Wann wird VULA benötigt? 

lokale  Teilnehmerzugang 

Der  virtuell  entbündelte 
(VULA)  wurde  von  vielen 
Mitgliedsstatten  der  EU  als  eine  Wiederverkaufsauflage  festgesetzt,  in  denen  der 
Ausbau einer FTTx Architektur und/oder Technologie durch den marktbeherrschenden 
Anbieter (typischerweise der ehemalige Monopol-Anbieter) bedeutet, dass der physisch 
entbündelte  Zugang  zu  dem  FTTx-Netz  entweder  technisch  oder  ökonomisch  nicht 
durchführbar ist. Die wesentlichen Fälle, bei denen das zutrifft, sind die Fälle, bei denen 
(i)  der  Anbieter  FTTx  Netze  in  einer  Baum-Topologie  aufbaut  (z.B.  FTTC  oder 
FTTH/PON),  die  nicht  nahe  beim  oder  am  HVt  Standort  entbündelt  werden  können, 
und/oder  (ii)  wo  der  Anbieter  die  Vectoring  Technik  einsetzt  mit  dem  Ziel,  die 
Bandbreite für die Endkunden zu erhöhen. 

Warum sind die Spezifikationen für den VULA so bedeutsam? 

Eine wichtige Herausforderung für den VULA ( und andere Vorleistungsprodukte) ist im 
Gegensatz zur physischen Entbündelung dass die Auswahl der DSL Systeme und die 
daraus resultierenden technischen, bandbreitenmäßigen und preislichen Eigenschaften 
des Vorleistungsproduktes nur vom Zugangsanbieter bestimmt werden. Dies wirkt sich 
auf  die  Möglichkeiten  des  Vorleistungsnachfragers  aus,  sich  bezüglich  seiner 
Endverkaufsprodukte (im Hinblick auf Bandbreite, Preis und Qualität) zu differenzieren, 
den Netzbetrieb zeitnah zu überwachen und notwendige Reparaturen einzuleiten 

Vorbildliche VULA Eigenschaften 

In  Übereinstimmung  mit  den  Breitband-Förderleitlinien  der  Europäischen  Kommission 
und deren Entscheidung über den Deutschen Beihilfefall20 sowie mit den Erläuterungen 
zur  Marktempfehlung  von  2014  soll  ein  VULA  so  weit  wie  möglich  funktional  zur 
physischen  Entbündelung  äquivalent  sein.  Technisch  bedeutet  dies,  dass  der  Zugang 
(i)  lokal  geschieht;  (ii)  generisch  ist  und  eine  diensteunabhängige  Übertragungs-
kapazität  bereitstellt,  die  in  der  Paxis  unüberbucht  ist;  und  (iii)  dem  Vorleistungs-
nachfrager  ausreichende  Kontrolle  über  das  Übertragungsnetz  gestattet  um  ihm 
Produktdifferenzierung und -Innovation ähnlich wie bei der TAL zu erlauben. Zusätzlich 
merken  wir  an,  dass  die  Preisgestaltung  des  VULA  eine  Nutzung  ähnlich  wie  bei  der 
TAL  ermöglichen  sollte;  und  effektive  Migrationsprozesse  von  der  physischen 
Entbündelung  zum  VULA  sollten  implementiert  werden,  die  die  Akzeptanz  und 
Nachfrage  nach  diesem  neuen  Produkt  fördern  und  die  sicherstellen  sollen,  dass  der 
Wettbewerb auch dann erhalten bleibt wenn neue technische Lösungen eine Migration 
vom physisch entbündelten zum virtuellen Zugang erzwingen. 

Belegt durch Fallstudien und Interviews empfehlen wir, dass ein vorbildlicher und dem 
Stand der Technik und der betrieblichen Praxis entsprechender VULA die nachfolgend 
aufgeführten Eigenschaften aufweisen sollte: 

  20   S. Fußnote 15 

10 

 
                                                 
Technicalities of VULA products 

Eigenschaften 

Implementierung nach bestem Stand der Technik und betrieblichen Praxis 

Übergabepunkt 

1.  Der  VULA  sollte  zumindest  auf  der  HVt-Ebene  der  Netzhierarchie  zugänglich 

sein, sofern dies nicht möglich ist, auf einer höheren (regionalen) Ebene. 

2.  Die  Anzahl  der  Zugangsnachfrager  je  Übergabepunkt  darf  nicht  begrenzt 

werden. 

Generischer 
Zugang 

Steuerung/ 
Kontrolle durch 
den 
Zugangsnachfrager 

3.  Die Größe und Zahl der Übergabe-Ports sollte nur durch die Kapazität bestimmt 

werden, die die Endkunden jedes Zugangsnachfragers fordern.  

4.  Der Zugang zum VULA sollte über ein einziges gemeinsames Interface für alle 
existierenden  und  zukünftigen  VULA  Techniken  erfolgen  und  es  sollte  eine  für 
alle Techniken gemeinsame VULA Produktfamilie definiert werden. 

5.  Der VULA sollte über ein Layer 2 (Ethernet) Protokoll erfolgen. 
6.  Ein  unüberbuchbarer  VULA  sollte  angeboten  werden.  Dies  lässt  sich  am 
einfachsten  bei  einer  Übergabe  am  HVt  erreichen.  Wenn  ein  VULA  am  BNG 
übergeben wird, so sollte er auch unüberbucht konfiguriert werden können,21 
7.  10Gbit/s  Schnittstellen  sollten  auf  Wunsch  bereitgestellt  werden  können,  um 

Überbuchungen an der Übergabeschnittstelle zu vermeiden. 

8.  VLAN  tagging  sollte  eingesetzt  werden.  Es  sollte  zumindest  4  VLANs  pro 
für  weitere 

Endkunde  geben,  mit  dem  Möglichkeit,  diese  auf  8 
Produktdifferenzierungen zu erweitern.  

9.  Die  Größe  der    MTU  (Message  Transfer  Unit)  sollte  mindestens  1580  Bytes 

betragen. 

10.  Es  sollte  mindestens  eine  logische  Verbindung  je  Kunde  zwischen  dem 
Übergabepunkt  und  dem  Kundenendgerät  (CPE)  geben,  und  eine  eindeutige 
Kunden-ID, die zwischen Zugangsnachfrager und –Anbieter genutzt wird.  
11.  Eine Multicast Rahmen Replizierung is auf der Ebene der Kabinetts (KVz) nicht 

erforderlich, sollte aber auf jeder höheren Ebene angeboten werden. 

12.  Die  Wahl  des  Kundenendgerätes  sollte  frei  erfolgen  können,  z.B.  aus  einer 
Weißen  Liste  zugelassener  Geräte,  mit  der  Möglichkeit,  weitere  Geräte 
zulassen zu können.  

13.  Der  Zugangsnachfrager  sollte  die  volle  Kontrolle  über  die  technisch  mögliche 
Kapazität  der  Anschlussleitung  haben  –  Bandbreitenkontrolle  und  Verkehrs-
priorisierung sollten vom Zugangsnachfrager allein vorgenommen werden.  
14.  Idealerweise  sollte  der  Zugangsnachfrager  die  Zugangsschnittstellen  seiner 

Kunden im MSAN betreiben und steuern können.  

15.  Zugangsnachfrager  sollten  alle  Sicherheitsmaßnahmen  auf  Schicht  3  oder 

höher anwenden können.  

16.  Zugangsnachfrager sollten Fehler-Management Möglichkeiten durch Zugang zu 
Informationen  der  Anschlussverbindungen  und  durch 
Echtzeit-Status 
monatliche Anschlussstatistiken erhalten. Es sollten ein Verfügbarkeitskriterium 
und eine eindeutige Fehlerdefinition vorhanden sein. 

17.  Die  Einhaltung  der  vereinbarten  Dienstgüte  (SLA)  für  Bereitstellung  und 
Reparatur  sollte  durch  KPI  Überwachung  mit  automatisch  gezahlter 
Entschädigung im Fall der Nichteinhaltung erreicht werden.  

18.  Zugangsnachfrager  sollten  die  betrieblichen  und  geschäftlichen  Abläufe  auch 

mit dem Zugangsanbieter automatisiert steuern können.  

Migration 

19.  Eine  Migration  sollte  frühzeitig  angekündigt  werden  und  im  Rahmen  eines 

gegenseitig abgestimmten Plans erfolgen.  

20.  Für  eine  Massenmigration  sollte  ein  automatisiertes  Verfahren  zur  Verfügung 

stehen.  

21.  Für  eine  Massenmigration  sollten  spezifische  KPI  definiert  und  überwacht 

werden, mit automatisch gezahlter Entschädigung im Fall der Nichteinhaltung. 

22.  Im Fall einer erzwungenen Migration sollten verlorene Investitionen in der Höhe 

ihres Netto-Buchwertes zum Migrationszeitpunkt ersetzt werden.  

  21   Z.B.: Das österreichische VULA Produkt wird mit einer Kombination aus garantierter Kapazität für den 
einzelnen  Nutzer  und  Spitzenkapazität  angeboten,  die  unter  den  Nutzern  gemeinsam  nach  fairen 
Bedingen und bestem Bemühen (best effort) geteilt wird. 

11 

 
                                                 
Technicalities of VULA products 

Pricing 

23.  Der FTTC VULA Preis sollte auf den Kosten basieren und durch ein  BU-LRIC+ 

Verfahren bestimmt werden. 

24.  Für  einen  unüberbuchten  VULA  sollte  ein  einfacher  Preis  berechnet  werden, 
der  auf  der  unbeschränkten  Kapazität  der  Anschlussleitung  beruht  (begrenzt 
nur durch die technischen Möglichkeiten).  

25.  Der  Preis  für  einen  überbuchten  VULA  sollte  sich  an  aus  einem  kosten-

orientierten Anteil an dem Preis eines unüberbuchten VULA orientieren.  

.  

Analyse der übermittelten deutschen Produkte 

Die  nachfolgende  Tabelle  zeigt  die  Eigenschaften  der  übermittelten  deutschen  VULA 
Produkte in ihrer letztendlichen Version im Vergleich mit den vorbildlichen, dem besten 
Stand der Technik und des betrieblichen Brauchs entsprechenden Eigenschaften:  

Lokaler Übergabepunkt

Übergabepunkt

Anzahl ANO pro Übergabepunkt

Anzahl Übergabeports

Eine gemeinsame VULA Familie

Generischer Zugang:

L2 Protocol [y, n]

Upgrade Backhaul Kapazität

10 G Schnittstelle

VLAN tagging

Anz. VLAN pro Endkunde

Max MTU Größe

Ded. Verbindg pro Endkunde./ 
Verfügbarkeit Je Verbindung

Eindeutige Kunden-ID

DT

KVZ-AP-F

L2-BS

NetCologne

DNS:NET

Nur KVz
Zwei (Erweiterungslösung 
auf Nachfrage gesucht)
Zwei 10G pro MSAN für max 
448 Ports 
(Erweiterungslösung auf 
Nachfrage gesucht)

BNG

unbegrenzt

einer pro BNG

Nur KVz

unbegrenzt

KVz, BNG optional

unbegrenzt

10G pro Portkarte für 
jeweils 48 Ports, 
erweiterbar

10G für max. 192 Ports, 
erweiterungsfähig 

Absichtserklärung

n, nur FTTC spezifisch

Absichtserklärung

Absichtserklärung

angeboten

unüberbucht

angeboten

angeboten

angeboten

n

max. 2,5 G unüberbucht

unüberbucht

1-10G

1-10G Interface, überbuchb .

10G/ max 2,5 G

angeboten

3,872

angeboten

3,872

max. 1.950 Byte

max. 1.950 Byte

angeboten

4,094

1,580

angeboten

angeboten

angeboten

angeboten

n

n

angeboten
Auf Nachfrage, 
Zusatzvereinbarung

Multicast Rahmen Replizierung

n

Kontrolle d. Zugangsnachfragers:

CPE: durch ANO bzw. Endkunde

Bandbreitenkontrolle d. ANO

Kontrolle MSAN Port Parameter

angeboten
angeboten
angeboten (bei 
Produktdifferenzierung)

y
stufenweise, keine Sym.

n

angeboten
angeboten
angeboten (bei 
Produktdifferenzierung)

Security: ANO Unterstützg verfgb.

angeboten

nicht spezifiziert

angeboten

Fehler Management:

Real-time Diagnose und Analyse

Klare Fehlerdefinition

MTR targets/ KPI monitoring

Automat. Schadensredulierung

Ausreich Kontr. von OSS und BSS

Migration:

Rechtzeitige Anzeige

Massenmigrationsprozess

Migration KPI Monit./ Kompens.

Kompensation frustr. Invest.

Preis:

Bottom-up regulator. Kosten

Unüberb. Preis analog fix Bandbr.

Überbucht, Preis-Anteil unüberb.

12 

angeboten

angeboten

angeboten

angeboten

angeboten

na

Forecast

n

n

unklar

unklar

na

nicht spezifiziert

n

n

n

offered

na

Forecast

n

n

j

angeboten

angeboten

angeboten

angeboten

angeboten

na

Forecast

n

n

n, risk sharing Modell

j, orient. an regul. Preisen

Keine BB Garantie

unklar

j

na

j, orient. an regul. Preisen

unklar

1-10G

angeboten

4,096

> 1580

angeboten 

angeboten

j, optional

angeboten
angeboten

angeboten

angeboten

angeboten

angeboten

angeboten

angeboten

angeboten

na

Forecast

n

n

 
 
Technicalities of VULA products 

Alle Produkte enthalten positive Merkmale (grün: entspricht dem Maßstab; gelb: Fakten 
müssen noch vom Zugangsanbieter nachgeliefert werden, rot: erfüllt nicht den Maßstab 
des vorbildlichen, besten Stand der Technik und des betrieblichen Brauchs aus Kapitel 
4) für alle relevanten Eigenschaften, mit Ausnahme des L2 Bitstrom-Zugangsproduktes, 
das  ursprünglich  in  die  Analyse  mit  eingeschlossen  war,  weil  die  DT  dieses  als 
Ergänzung zu ihrem VULA-Produkt eingereicht hatte.   

Die  Analyse  des  "Best  practice"-VULA  hat  ergeben,  dass  aus  technischer  und 
ökonomischer  Sicht  ein  Übergabepunkt  auf  einer  Netzebene  über  dem  KVz  wichtig 
wäre.  Die  VULA  Produkte  der  DT,  NetCologne  und  DNS:NET  zum  Einsatz  in  den 
Gebieten  mit  staatlicher  Beihilfe  bieten  alle  nur  eine  Übergabe  am  Kabinett 
(Straßenverteiler,  KVz).  In  Österreich,  Dänemark  und  Großbritannien  wird  VULA  nicht 
ausschließlich  am  KVz  angeboten,  sondern  auch  auf  der  HVt-Ebene  oder  höher  an 
einem Standort, der mehrere HVt zusammenfasst. Wie unten weiter ausgeführt ist die 
Übergabe auf einer dem HVt vergleichbaren Ebene wichtig für eine ausreichend großen 
Bestand  adressierbarer  Kunden,  der  den  Zugang  erst  wirtschaftlich  tragfähig  machen 
kann und es den Nachfragern  gleichzeitig erlaubt, ihre eigenen bestehenden Backhaul-
Kapazitäten  effizient  zu  nutzen.  Auf  der  anderen  Seite  ist  positiv  zu  vermerken,  dass 
alle  übermittelten  KVz  VULA  Produkte  die  technischen  und  physikalischen  Eigen-
schaften  der  Anschlussleitung  maximal  ausschöpfen,  um  eine  höchstmögliche 
Bandbreite  und  einen  hohen  Grad  an  Produktgestaltungsspielraum  diesbezüglich  zu 
ermöglichen.  

Zwei  der  Betreiber,  DT  und  DNS:NET,  bieten  auch  einen Layer  2  Vorleistungszugang 
an einem regionalen BNG Übergabepunkt an. Dieser Übergabepunkt, der vergleichbar 
mit  der  Übergabe  am  „Eltern-Knoten“  in  Großbritannien  ist,  bietet  einen  besser  der 
Nachfrage  angepassten Übergabepunkt  dar  als die  Übergabe  am  KVz.  Dennoch,  weil 
die  deutsche  Regulierungsbehörde  BNetzA  diesen  Übergabepunkt  dem  Markt  des 
Zentralen Netzzugangs (WCA: Wholesale Central Access, Markt 3b) zuordnet statt dem 
Markt des lokalen Netzzugangs (WLA: Wholesale Local Access, Markt 3a), dem  auch 
der  physisch  entbündelte  Zugang  zugeordnet  ist,  hat  sie  das  Substitutionspotenzial 
dieser  Produkte  für  den  physisch  entbündelten  Zugang  nicht  erkannt.  Auch  die 
Eigenschaften  des  Layer  2  BNG  Produktes  der  DT  erfüllen  die  vorbildhaften 
Eigenschaften  für  ein  VULA  Produkt  nicht,  die  in  dieser  Studie  abgeleitet  werden. 
Wesentliche  Bereiche,  in  denen  das  BNG-Produkt  der  DT  die  Kriterien  des  besten 
Stands der Technik und des betrieblichen Brauchs nicht erfüllt sind:  

•  Es  gibt  keine  klare  Information  darüber,  welche  Anschlussbereiche  welchem 
spezifischen  BNG  zugeordnet  sind.  Eine  einzige  Übergabe  je  BNG-Standort 
wird nicht angeboten.  

•  Derzeit  ist  das  Produkt  technologie-spezifisch.  Daher  besteht  Unsicherheit 
über  die  Behandlung  von  VULA  Zugang  über  FTTH  GPON  oder  andere 

13 

 
Technicalities of VULA products 

Techniken,  die  eine  physische  Entbündelung  nicht  oder  nur  sehr  schwierig 
unterstützen. 

•  Die  Zugangsnachfrager  haben  keine  volle  Kontrolle  über  die  technischen  und 
physikalischen  Eigenschaften  der  Zugangsverbindung.  Sie  können  nur  aus 
einem vordefinierten Satz von Bandbreitenprofilen aussuchen.  

• 

In  der  übermittelten  Beschreibung  gibt  es  keine  Bandbreitengarantien  oder 
Planungsregeln  für  eine  zulässige  Überbuchung,  oder  eine  Beschreibung 
anderer  Maßnahmen  zur  Sicherstellung  von  Bandbreitenkontrolle,  die  dem 
besten  Stand  der  Technik  und  betrieblichen  Praxis  für  überbuchten  oder 
unüberbuchten VULA  im Backhaul entsprechen. 

•  Der Ansatz zum VLAN tagging entspricht im Prinzip dem Stand der Technik und 
der 
für  eine 

betrieblichen 
Vorleistungsnachfrager  auf  maximal  3.872  Endkunden,  was 
Übergabe auf regionaler Ebene sehr gering ist. 

Adressraum 

begrenzt 

Praxis, 

aber 

den 

•  Eine Multicast Rahmen Replizierung wird nicht unterstützt, hat aber gerade 

auf der Ebene regionaler Übergabe am BNG eine hohe Bedeutung. 

•  Fehler  sind  nicht  klar  definiert.  Verbindliche  maximale  Entstörzeiten  sind 
festgelegt,  aber  KPIs  zur  Überwachung  der  Einhaltung  oder  ein 
pauschalierter  Schadensersatz,  der  automatisch  bei  Nichteinhaltung  der 
Werte geleistet wird, sind nicht definiert22. 

•  Obwohl ohne Relevanz für den Fall staatlicher Beihilfe23 weisen wir darauf hin, 
dass  automatisierte  Prozesse  für  den  Fall  der  Massenmigration  nicht 
vorgesehen sind.  

Die BNetzA notifizierte ihre Entgeltentscheidung für den Layer 2 Bitstrom (Übergabe auf 
der BNG-Ebene) bei der Kommission am 18. November 2016. Diese Preise traten am 
22. Dezember 2016 in Kraft24. Obwohl ein Flat Rate Entgelt für Leitungen angewendet 
wird, die auf VDSL Vectoring aufgerüstet wurden, gibt es eine Bandbreitenobergrenze 
für  VDSL  Vectoring  (bis  zu  100  Mbit/s25)  und  eine  Beschränkung  im  Gesamt-
summenverkehr26  auf  der  Backhaul-Verbindung  zum  BNG  und  in  der  Übergabe-

  22   Während  dies  für  das  KVz-VULA  im  Fördergebiet  sichergestellt  wird,  wird  es  von  DT  jedoch  nicht 

generell in allen anderen Wholesale-Zugangsprodukten angeboten.  

  23   Sie  sind  relevant  für  den  Fall  der  Vectoring-II  Entscheidung,  Vectoring  im  Nahbereich.  Erzwungene 
Massenmigration  kann  in  Fördergebieten  nicht  entstehen,  da  dort  zuvor  breitbandige  Produkte,  die 
ersetzt werden müssten, nicht existierten. 

  24   BNetzA Pressemitteilung vom of 21.Dezember 2016, 

https://www.bundesnetzagentur.de/SharedDocs/Pressemitteilungen/DE/2016/161221_Bitstrom.html?
nn=712782 

  25   BK3-15-003_2.  Teilentscheidung,  II.  Anhang  A  –  Leistungsbeschreibung  L2_BSA_VDSL,  II.1.  Ziffer 

1.1 

  26   BK3-15-003_2. Teilentscheidung, V. Anhang A – Leistungsbeschreibung  L2_BSA-Transport und L2-

Übergabeanschluss, V.1. Ziffer 3 

14 

 
                                                 
Technicalities of VULA products 

schnittstelle,  die  nicht  mit  den  Eigenschaften  besten  Standes  der  Technik  und  der 
betrieblichen Praxis übereinstimmen.  

Auswirkungen  von  FTTC/VDSL  und  Vectoring  auf  den  Wettbewerb 
Deutschland in Beihilfegebieten 

in 

In vielen Beihilfegebieten in Deutschland ist die FTTC/ VDSL Technologie zum Ausbau 
vorgesehen,  davon  in  vielen  in  der  Kombination  mit  Vectoring.  Vectoring  ist  eine 
Technologie zur Eliminierung gegenseitiger Störungen (Nebensprechen) zwischen den 
Anschlusslinien  desselben  Kabels.  Sie  ermöglicht,  höhere  Bandbreiten  zu  erzielen  als 
man  mit  FTTC/VDSL  ohne  Vectoring  erzielen  könnte.  Außerdem  verlängert  sie  die 
Reichweite höherer Bandbreiten.  

FTTC/VDSL  in  Kombination  mit  Vectoring  kann  zur  Erlangung  der  Breitbandziele  der 
Digitalen  Agenda  für  Europa  (DAE)  mit  geringeren  Investitionen  beitragen  als  beim 
Ausbau  mit  FTTH/B.  Dennoch  gibt  es  zwei  Eigenschaften  der  geplanten  technischen 
Lösung  für  die  Beihilfegebiete  in  Deutschland  die  Herausforderungen  an  die  weitere 
Nutzung  der  physischen  Entbündelung  stellen  und  daher  den  zugangsbasierten 
Wettbewerb beeinträchtigen: 

1.  Das  geplante  Ausrollen  von  FTTS/VDSL  würde  bedeuten,  dass  es  –  für  die 
durch  Beihilfe  geförderte  höheren  Anschlussgeschwindigkeiten  –  nicht  mehr 
eine einzelne individuelle physische Verbindung zwischen dem Endkunden und 
dem  HVt  gibt.  Physische  Entbündelung  am  HVt  (dem  Ort,  an  dem  heute  die 
physische  Entbündelung  ganz  überwiegend  stattfindet)  würde  daher  für  die 
Verbindungen mit höherer Kapazität nicht mehr länger möglich sein.   

2.  Weil  Vectoring  Wissen  über  die  auf  allen  Adern  übertragenen  Signale  benötigt 
ist  es  derzeit  nicht  kompatibel  mit  der  physischen  Entbündelung  der 
Teilnehmeranschlussleitung  am  HVt  (TAL)  oder  KVz  (KVz-TAL).  Die  TAL  kann 
nur  unter  Begrenzung  der  nutzbaren  Frequenzen  und  Bandbreiten  weiterhin 
genutzt werden. 

Die  übermittelten  VULA  Produkte  am  Straßenverteiler  (KVz)  sollen  die  Wettbewerbs-
bedenken  adressieren,  die  sich  aus  den  technischen  Einschränkungen  des  Vectoring 
ergeben.  Dennoch  bieten  sie  kein  Substitut  für  die  derzeit  in  Deutschland  weitgehend 
gebräuchliche Form der Entbündelung – die physische Entbündelung der TAL am HVt. 
Statt  dessen  nötigen  die  Produkte  den  Zugangsnachfrager  eine  Glasfaser  näher  bis 
zum Endkunden auszubauen, nämlich bis zum Straßenverteiler. 

Vorhandene  Indizien  einschließlich  der  begrenzten  Nachfrage  nach  Zugang  am 
Straßenverteiler  (Entbündelung  der  KVz-TAL)  und  der  Ergebnisse  von  einschlägigen 
Kostenmodellierungen von Analysys Mason27 und WIK28 deuten darauf hin, dass es für 

  27   Analysys: The business case for sub-loop unbundling in the Netherlands, OPTA, January 2007 
  Analysys: The business case for sub-loop unbundling in Dublin, ComReg, 20. December 2007 

15 

 
                                                 
 
Technicalities of VULA products 

Zugangsnachfrager nicht ökonomisch tragfähig ist, ihre Infrastrukturen vom HVt, wo sie 
heute  präsent  sind,    zum  KVz  hin  auszudehnen,  da  dort  die  Zahl  der  durch  die 
Infrastruktur  adressierbaren  Kunden  erheblich  geringer  ist  als  am  HVt.  Das  gilt  umso 
mehr  im  dünn  besiedelten  ländlichen  Raum,  der  typischerweise  Gegenstand  von 
staatlicher  Beihilfe  sein  wird.  Mehr  noch,  wenn  nur  VULA  am  KVz  verfügbar  ist  und 
nicht  physische  Entbündelung  (KVz-TAL),  erfahren  die  alternativen  Betreiber  zudem 
Einschränkungen  in  ihrer  Produktgestaltungsfreiheit  und  –differenzierung,  die  die 
Kollokation dort noch weniger attraktiv machen.  

Wir  haben  verschiedene  alternative  Lösungen  daraufhin  untersucht,  inwieweit  sie 
höhere Bandbreiten ermöglichen und gleichzeitig die Vorteile physischer Entbündelung 
erhalten.  Multi-Vendor  Vectoring  Lösungen  wurden  angekündigt,  die  den  Wettbewerb 
bei  FTTC/VDSL  Vectoring  auf  der  Basis  der  KVz-TAL  (SLU)  erlauben  würden,  aber 
diese  werden  immer  noch  nicht  in  der  Praxis  eingesetzt.  Sie  würden  gleichfalls  nicht 
aus  sich  heraus  den  physisch  entbündelten  Zugang  am  HVt  oder  vergleichbaren 
Standort erlauben, weil die DSLAMs alle am KVz würden angesiedelt sein müssen.  

Die  Nutzung  des  VDSL  Profils  35b  ohne  Vectoring  würde  eine  deutliche 
Bandbreitenerhöhung  erlauben  und  gleichzeitig  die  physische  Entbündelung  am 
Standort  des  VDSL  DSLAMs  (entweder  HVt  oder  KVz)  erlauben.  Allerdings  erlaubt 
auch  diese  Lösung  nicht  den  Einsatz  von  VDSL  am  HVt,  wenn  FTTC  mit  VDSL  mit 
staatlicher  Beihilfe  am  KVz  ausgebaut  wurde,  weil  der  MSAN  am  KVz  mit  deiner 
höheren Sendeleistung die Signale vom HVt unterdrückt.  

Die  Implementierung  von  VULA  am  HVt  oder  BNG  Standort  in  Übereinstimmung  mit 
den  hier  vorgeschlagenen  Eigenschaften  nach  bestem  Stand  der  Technik  und  der 
betrieblichen  Praxis  sind  die  Lösungen  mit  der  höchstwahrscheinlich  höchsten 
Relevanz  für  die  Beibehaltung  des  Wettbewerbs  im  Fall  von  staatlicher  Beihilfe  für 
Netzarchitekturen,  die  die  physische  Entbündelung  der  Anschluss-Infrastruktur  nicht 
mehr länger ermöglichen. 

  28   WIK: The economics of next generation access, 2008/ 2009, WIK: Implications of a nationwide fibre 
roll  out  and  its  subsidy  requirement,  wik,  Bad  Honnef,  October  2011,  WIK:  Der  dynamische 
Investitionswettbewerb  als  Leitbild  der  zukünftigen  Entwicklung  des  Telekommunikationsmarktes, 
November  2013,  WIK:  Benefits  and  regulatory  challenges  of  VDSL  vectoring  (and  VULA),  Florence 
School of Regulation, March 2014, Florence, EUI Working Papers RSCAS 2014/ 69 

16 

 
 
                                                                                                                                             
Technicalities of VULA products 

Abbreviations 

ADSL 

Asynchronous Digital Subscriber Line 

A1TA 

A1 Telekom Austria 

ANO 

Alternative Network Operator 

API 

Application Program Interface 

BEREC  Body of European Regulators for Electronic Communications 

BMVI 

Bundesministerium für Verkehr und Digitale Infrastruktur, Federal Ministry for 
Traffic and Digital Infrastructure 

BNetzA  German NRA, Bundesnetzagentur, the German NRA 

BNG 

Broadband Network Gateway 

BRAS 

Broadband Remote Access Server 

BSA 

BSS 

BT 

Bitstream Access 

Business Support System 

British Telecom 

DAE 

Digital Agenda of Europe 

DBA 

Danish Business Authority, the Danish NRA 

DT 

Deutsche Telekom 

DSLAM  Digital Subscriber Line Access Multiplexer, comparable to MSAN 

ESS 

Elektronische Entstörschnittstelle, Electronic Repair Interface 

FTTB 

Fibre to the Building 

FTTC 

Fibre to the Cabinet 

FTTH 

Fibre to the Home 

GPON  Gigabit Passive Optical Network 

GUI 

HVt 

Graphical User Interface 

Hauptverteiler, Main Distribution Frame, Local Exchange 

ICMP 

Internet Control Message Protocol (for IP Version 6), supports Multicast 

IGMP 

Internet Group Management Protocol (for IP Version 4), supports Multicast 

IP 

Internet Protocol 

ISDN 

ISO 

KVz 

Integrated  Services  Digital  Network  (digital  telephony  and  dial  up  data 
connections) 

International Standards Organisation 

Knotenverzweiger, Street Cabinet 

17 

 
Technicalities of VULA products 

L2 

LAN 

LER 

LLU 

Layer 2 (Ethernet Protocol)/ Layer 3 (IP-Protocol) 

Local Area Network 

Label Edge Router 

Local Loop Unbundling 

LSR  

Label Switch Router 

MDF 

Main Distribution Frame, Local Exchange 

MPoP  Metropolitan Point of Presence 

MPLS  Multiprotocol Label Switching 

MSAN  Multi-Service Access Node, comparable to DSLAM 

MTP 

Mean Time to Provision 

MTR 

Mean Time to Repair 

MTU 

Message Transfer Unit 

NRA 

National Regulatory Agency 

ODF 

Optical Distribution Frame (optical MDF) 

Ofcom  Office for Communications, the British NRA 

OLT 

Optical Line Terminator (for GPON systems) 

OSI 

Open Systems Interconnection 

OSS 

Operation Support System 

PoP 

Point of Presence 

POTS 

Plain Old Telephone Services (analogue telephony) 

QoS 

Quality of Service 

RTR 

Rundfunk & Telekom Regulierungs-GmbH, the Austrian NRA 

SDSL 

Symmetrical Digital Subscriber Line 

SLU 

Subloop Unbundling (KVz-TAL) 

SNR 

Signal to Noise Ration 

TAL 

TCP 

Teilnehmeranschlussleitung, Local Loop 

Transmission  Control  Protocol  (layer  4  connection  controlled  end-to-end 
protocol) 

UDP 

User Datagram Protocol (layer 4 connectionless end-to-end protocol) 

U.K. 

United Kingdom 

VDSL 

Very High Speed Digital Subscriber Line 

18 

 
Technicalities of VULA products 

VLAN 

Virtual Local Area Network 

VPN 

Virtual Private Network 

WAN 

Wide Area Network 

WBA 

Wholesale Bitstream Access 

WIA 

Wholesale Internet Access 

WLR 

Wholesale Line Rental 

19 

 
 
Technicalities of VULA products 

1 

Introduction and methodology 

1.1  Objectives of the study 

In  June  2015  the  Commission  approved  the  provision  of  state  aid  to  support  the 
deployment of high speed broadband connections in Germany29. The stated objective 
of  the  state  aid  measure  is  to  promote  the  development  of  NGA  broadband  networks 
with fibre or equivalent backhaul and access networks close enough to subscribers to 
provide reliable high speed internet services. The German authorities aim through this 
to  achieve  download  speeds  of  at  least  30Mbit/s,  and  preferably  50  Mbit/s,  with  an 
upload capacity at least double that of basic broadband. 

One  of  the  obligations  associated  with  state  aid  is  that  the  selected  network  operator 
must  provide  open  and  non-discriminatory  wholesale  access  to  the  subsidised 
infrastructure,  including  access  to  ducts,  dark  fibre,  bitstream  access,  unbundled  local 
loop and street cabinets.30 

In this context the Commission noted that subsidies for the construction and operation 
of  infrastructures  for  which  physical  unbundling  is  technically  or  economically  not 
feasible  should  be  conditional  on  the  availability  of  a  virtual  unbundled  local  access 
product (VULA) that is functionally equivalent to physical unbundling.31 VDSL vectoring 
technology  has  been  recognised  as  one  example  which  would  create  technical 
challenges for physical unbundling. 

The  conditions  set  out in  the state aid  decision  require  an approval  of VULA  products 
before operators are permitted to use vectoring technology32 (or other solutions which 
impede physical unbundled access) in the subsidised areas.  

After a public consultation in May 201633 in September 2016, Germany submitted three 
VULA  products  to  be  supplied  by  the  operators  DNS:NET,  NetCologne  and  Deutsche 
Telecom. 

The Directorate General for Competition of the European Commission (DG Comp) in a 
first  step  had  to  reach  a  decision  on  whether  the  submitted  VULA  products  have  the 
necessary technical characteristics to comply with the open access requirements as set 
out in the 2013 Broadband Guidelines and the Explanatory note34 on the Commission’s 

  29   SA.38348 (2014/N), 

http://ec.europa.eu/competition/state_aid/cases/251861/251861_1670915_79_2.pdf 

  30   Paragraph 29 of the State Aid Decision 
  31   Paragraph 30 of the State Aid Decision 
  32   Vectoring technology eliminates the cross talk between neighboring copper pairs in a cable binder and 
thereby  enables  the  transmission  of  higher  speed  broadband  signals  over  copper  access  lines  than 
other coding methods. 

  33   

http://www.bmvi.de/DE/DigitalesUndRaumentwicklung/Breitbandausbau/Breitbandfoerderung/Vectorin
g/VULAAnhoerung/vula-anhoerung_node.html 

  34   SWD(2014) 298 

21 

 
                                                 
Technicalities of VULA products 

2014  market  recommendations  (9.4.2014)35,  including  the  requirement  that  VULA 
should be functionally equivalent to physical unbundling.  

DG Comp commissioned WIK to undertake a study to support them in this evaluation.36 
The study had three main elements: 

1.  To assess the VULA products which are already used in other Member States 

2.  To consult the main stakeholders in the sector; and 

3.  To  advise  DG  Comp  on  whether  the  proposed  products  comply  with  the 

technical requirements 

The methodology and structure of the report are described in the following sections. 

1.2  Methodology 

The  starting  point  for  our  analysis  was  to  identify  the  main  features  of  physical 
unbundling  and  the  high  level  characteristics  which  would  be  required  for  virtual 
unbundling  (VULA)  to  be  considered  a  functional  substitute  to  physical  unbundling.  In 
so doing, we referred to guidance provided in the explanatory memorandum to the EC 
Relevant  market  Recommendation  2014,  and  the  2015  report  on  Layer  2  bitstream 
prepared by BEREC.37 

In  order  to  identify  more  detailed  ‘best  practice’  VULA  specifications,  we  reviewed 
product descriptions and Reference Offers for VULA from three countries in which the 
product  is  well-established.  We  then  conducted  structured  interviews  with  NRAs  and 
access seekers in the relevant countries (8 interviews in total) to gauge which aspects 
of  the  specification  were  considered  most  important,  and  whether  there  was  market 
acceptance of these aspects. 

Having identified the key elements of a ‘best practice’ offer, we then benchmarked the 
proposed  German  specifications  and  Reference  Offer  against  these  standards.  A 
number  of  open  issues  regarding  the  originally  submitted  VULA-products  were  later 
clarified or modified during the procedure. The current version of the study relates to the 
final versions as submitted by the three companies in July/August 2017.  

Finally,  we  considered  what  would  be  the  technical  and  economic  impacts  on 
competition  of  the  proposed  FTTC/VDSL  solution  with  Vectoring  in  Germany,  with  a 
focus  on  the  implications  for  physical  unbundling  of  the  local  loop  (at  MDF  and  street 
cabinet  level).  We  compared  these  impacts  with  counterfactual  cases  in  which 

  35   C(2014) 7174 final 
  36   The  scope  of 
COMP/2016/023 

the  project 

is  shown 

in  http://ec.europa.eu/competition/calls/exante_en.html 

  37   BEREC Common position on layer 2 wholesale access products, BOR (16) 162 

22 

 
                                                 
Technicalities of VULA products 

FTTC/VDSL (with and without) vectoring had not been applied, or alternative solutions 
to vectoring were adopted to increase bandwidths over FTTC/VDSL lines (section 6). 

1.3  Structure 

The report is structured as follows: 

•  Section 2 defines metrics for VULA based on EC and BEREC documentation 

•  Section 3 compares the specification for VULA in three countries 

•  Section 4 draws on the previous analysis to define ‘best practice’ specifications 

for VULA 

•  Section  5  analyses  the  proposed  VULA  (and  other  relevant  wholesale  access) 
products  in  Germany,  with  reference  to  best  practice.  While  version  1  of  this 
report  reflects  the  state  of  the  originally  submitted  products  by  the  German 
government (after the national consultation), version 2 of this study reflects the 
state of the products in their final version. 

•  Section 6 discusses the implications of the proposed VULA solution in Germany 

for competition, with reference to counterfactual cases; and 

•  Conclusions and recommendations are summarised in section 7. 

23 

 
 
Technicalities of VULA products 

2  Defining metrics for VULA 

The technical characteristics of a physical unbundled loop are relatively straightforward 
as  the  wholesale  product  involves  access  to  a  unique  cable  at  the  physical  layer. 
Physical  access  provides  the  maximum  degree  of  transparency  and  control  for  the 
access seeker. Compliant CPE38 may be freely installed and the access seeker is free 
to  install  and  operate  its  own  DSLAM  or  optical  equipment  subject  only  to  criteria 
designed  to  avoid  interference.39  The  access  seeker  can  freely  set  bandwidths 
(asymmetric and/or symmetric) and profiles up to the maximum capability of the copper 
or  fibre  cable40  and  can  keep  pace  with  the  technological  progress  of  equipment 
suppliers. The access seeker pays a typically cost-oriented flat monthly rental fee for a 
line which is fully configurable (subject to the limitations of the copper technology), and 
is  free  to  set  its  own  retail  tariff  structures  independently  from  the  supplier  of  the 
unbundled  copper  loop.  The  access  seeker  also  has  full  visibility  concerning  the  ‘line 
state’  (faults  in  the  equipment  and  on  the  line),  and  can  therefore  rapidly  identify,  if, 
when  and  where  repairs  are  needed.  It  can  organize  and  prioritise  such  work  with 
reference to its own criteria.  

However,  when  active  access  is  provided  because  physical  unbundling  is  not 
technically or economically feasible, the choice of DSL equipment, technical, bandwidth 
and  to  some  extent  the  pricing  characteristics41  of  the  wholesale  product  are 
determined  by  the  access  provider.  This  has  an  impact  on  who  is  able  to  monitor  the 
network  operation,  identify  and  analyse  failures and  take  appropriate  action  for  repair, 
including  repairs  to    the  active  equipment.  In  markets  in  which  there  is  likely  to  be 
insufficient  competition  at  the  network  level  to  constrain  the  conduct  of  the  access 
provider (including state aid areas in which investment in ‘step change’ NGA services is 
not commercially viable in the absence of subsidies), criteria are needed to determine 
whether active wholesale access provides a level of control which at least approaches 
that which would be offered through physical unbundling.42   

In  this  section  we  summarise  the  main  characteristics  of  VULA  as  defined  in  the 
the  EC  2014  Relevant  Market 
explanatory  memorandum  accompanying 
Recommendation, in order to identify metrics to be used in the comparison of existing 

  38   At the end-customer premise a CPE (customer premise equipment, typically a router) and a modem 
(may be integrated into the CPE) are installed, which build the interface between the inhouse network 
and  the  wide  area  network  of  a  network  operator.  The  modem  and  Router  have  to  interact  with  the 
DSLAM at the network operators side following predefined and standardised rules. Modem and router 
respectively the CPE have to be compliant with these interworking rules   

  39   Spectral management plans are used to limit cross-talk in the context of copper local loop unbundling 
  40   For copper see Figure 5-1, Figure 5-6 and Figure 5-7 and the appropriate explanations, depending on 
line  length  and  technology,  relevant  are  the  values  without  Vectoring  (profile  35b  appr.  150  Mbit/s 
down and 50 Mbit/s upstream below 500m; for fibre 100 Gbit/s symmetrical. 

  41   In  ex-ante  regulation  the  prices  are  strictly  controlled  by  the  regulator,  but  typically  basing  on  the 

operator’s application, and the prices should cover at least efficient cost. 

  42   Wholesale active access is unlikely to be fully functionally equivalent to physical access, because the 
choice  of  the  exchange  equipment  lies  with  the  access  provider.  Control  over  the  active  equipment 
also  implies that the access  provider has control  over the interfaces  used to calibrate the service  or 
detect faults. 

24 

 
                                                 
Technicalities of VULA products 

VULA offers and the definition of ‘best practice’. As the resulting core characteristics are 
still  high  level,  we  further  elaborate  the  metrics  based  on  BEREC  analysis,  market 
practice and more detailed statements already made by the Commission regarding the 
German case (section 2.3) in sections 2.2 - 2.4 and 3. 

2.1  The EC Decision (2014 Relevant Market Recommendation explanatory 

note) 

in 

the  2014  explanatory  memorandum  accompanying 

In  its  State  Aid  Decision  of  2015,  DG  Comp  refers  to  the  characteristics  of  VULA 
described 
the  EC 
Recommendation  on  Relevant  Markets.  This  identifies  the  following  characteristics  as 
distinguishing wholesale products which functionally replicate key features of traditional 
physical and local unbundling access from other forms of access, such as bitstream. 

1.  Access occurs locally. This means that traffic is handed over at a level which is much 

closer  to  the  customer  premises  than  access  at  the  national  or  regional  level  as 

generally granted with traditional bitstream access. Such "localness" is typically given in 

a scenario where access is granted at or close to the central office/MDF (including newly 

built ODF) or the street cabinet. However, while the virtual access product should aim to 

replicate  LLU  effectively,  the  number  of  interconnection  points  does  not  necessarily 

need to be equivalent to the copper network's points of interconnection.  

2.  Access 

is  generic  and  provides  access  seekers  with  a  service-agnostic 

transmission  capacity  uncontended 

in  practice, 

i.e.  providing  guaranteed 

bandwidths  according  to  the  access  seekers’  needs,  whereby  respective  access 

requests  are  subject  to  the  principle  of  proportionality,  and  would  normally  not  require 

the SMP operator to deploy new physical infrastructure. Uncontended access requires in 

principle  the  establishment  of  a  dedicated  logical  connection  between  the  customer 

facilities and the point of handover. The technical features of the connection (backhaul 

connecting the street cabinet and central office and capacity dimensioning in particular) 

should only be limited by the inherent capabilities of the access technologies deployed 
and support LLU-like services (e.g. multicast43 where appropriate).  

3.  Access  seekers  need  to  have  sufficient  control  over  the  transmission  network  to 

consider  such  a  product  to  be  a  functional  substitute  to  LLU  and  to  allow  for  product 

differentiation and innovation similar to LLU. In this regard, the access seekers' control 

  43   Multicast  is  a  feature  typically  used  for  IP-TV  transmission.  Instead  of  transmitting  all  TV-channels 
down to each customer (Broadcast) it is only transmitted to those having subscribed for it. Thus there 
may  be  branches  of  a  broadcast  tree  from  the  IP-TV  server  to  all  end-customers  which  are  not 
occupied by the TP-TV signal. The branches used can be further optimized by only transmitting those 
channels  being  requested  at  that  time  by  end-customers.  This  is  controlled  by  the  Internet  Group 
Management  Protocol  (IGMP),  which  supports  to  reduce  the  bandwidth  requires  and  makes  the 
transport  more  efficient.  On  bandwidth  restricted  access  lines  (like  the  copper  access  lines)  such 
feature  is  in  any  case  required.  Typically  the  number  of  channels  is  restricted  to  4  in  parallel  at  the 
same time. In case of LLU the access seeker is free to deploy its own equipment supporting multicast 
frame replication. In case of wholesale active access the access providers equipment should support 
it also, at least at network levels where the bandwidth savings are significant.  

25 

 
                                                 
Technicalities of VULA products 

of the core network elements, network functionalities, operational and business process 

as  well  as  the  ancillary  services  and  systems  (e.g.  customer  premises  equipment) 

should  allow  for  a  sufficient  control  over  the  end  user  product  specification  and  the 

quality of service provided (e.g. varying QoS parameters).  

fall  within 

Only those wholesale products meeting the above criteria should be considered to fall 
within  the  Wholesale  Local  Access  market  (market  3a).  Active  products  not  meeting 
these  criteria  might 
the  Wholesale  Central  Access  market,  which 
encompasses  access  products  enabling  access  seekers  a  less  direct  and  more 
standardised control over the access line. These characteristics are quite general and 
have to be filled with details one can derive out of best regulatory and market practice 
and  more  detailed  statements  the  Commission  already  made  regarding  the  German 
case so far (section 2.3) in sections 2.2 - 2.4 and 3. 

2.2  The BEREC definition 

In  October  2015,  BEREC  released  a  report  on  the  common  characteristics  of  layer  2 
wholesale access products44 and one year later the common characteristics on Layer 2 
Wholesale Access Products45 

In its first report BEREC noted that the analysis is descriptive, analysing the situation of 
10 European countries regarding VULA and L2 bitstream access, and does not aim at 
being normative or recommend a best practice. In its second report however, it defines 
common positions imposed on market 3a and 3b L2 access and identifies 10 ‘common 
technical  characteristics’  that  would  normally  be  identified  with  Layer  2  wholesale 
access, both local and regional: 

1.  Technology: 

Ethernet 

2.  CPE:  

determined by ANO 

3.  Bandwidth:  

4.  QoS:  

differentiated,  ANO  controlled,  up  to  the  maximum  of 
the technical capabilities of the access line 

“ostensibly”  uncontended  bandwidth,  at  least  of  the 
same standard as the incumbent’s retail products 

5.  Traffic prioritisation:  

ANO determined 

6.  Multicast:  

frame replication functionality (if necessary and 
proportionate) 

7.  Number of VLAN:  

several per end-user 

  44   BoR (15) 133 http://berec.europa.eu/eng/document_register/subject_matter/berec/reports/5439-berec-
report-on-common-characteristics-of-layer-2-wholesale-access-products-in-the-european-union 

  45   BoR (16) 162 

http://berec.europa.eu/eng/document_register/subject_matter/berec/regulatory_best_practices/commo
n_approaches_positions/6482-berec-common-position-on-layer-2-wholesale-access-products 

26 

 
                                                 
Technicalities of VULA products 

8.  Customer identification:   for each ANO and its customers 

9.  Security:  

ANO able to apply security measures 

10. Fault management:  

ANO received actual state reports of access line 

2.3  EC statements regarding German VULA submissions 

In  May  2016  the  European  Commission  responded  on  a  Wholesale  Local  Access 
notification of BNetzA46 (Vectoring II, near shore area) expressing its serious doubts on 
the notified access products, especially in regard to the number of handover interfaces 
at the MSAN level (1) and the appropriateness of a layer 2 access product (at the BNG 
–Level). In response to the second notification approach of BNetzA, who had withdrawn 
the  first  notification,  the  European  Commission  stated  in  July  201647  significant 
improvements  regarding  the  newly  notified  products,  but  still  criticized  the  layer  2 
access  which  BNetzA  considers  to  belong  to  market  3b,  but  nevertheless  would  be  a 
significant substitute for market 3a also. Thus the Commission demands for an effective 
economic  and  functional  substitute  for  physical  unbundling  in  this  regard  also,  which 
shall meet the criteria of the market recommendation.   

In a December 2016 statement made in response to BNetzA’s proposals for remedies 
(changes  to  the  Reference  Offer)  in  the  Wholesale  Central  Access  market,48  the 
European Commission further specified characteristics that should be associated with a 
fully adequate functional substitute in the context of Vectoring (in the near shore area). 
Since it is the only L2 product this view is also relevant for the far shore area, applied in 
both  cases  (with  and  without  state  aid).  From  WIK’s  point  of  view  the  L2  bitstream 
access  must  have  VULA  characteristics  in  order  to  become  a  full  functional  substitute 
for physical unbundling. 

Concerning ‘generic access’, the Commission noted that relevant features were: 

•  Layer 2 protocol 

•  Maximum MTU49 size 

  46   Case  DE/2016/1854,  C(2016)  2929  final:  https://circabc.europa.eu/sd/a/055249f0-8448-4f3e-844c-

c4d12cc001af/DE-2016-1854%20Adopted_EN.pdf  

  47   Case  DE/2016/1876,  C(2016)  4834  final  https://circabc.europa.eu/sd/a/4642d853-cd70-4d7a-9ef3-

f11c64e59be3/DE-2016-1876%20ADOPTED_EN%20for%20publication.pdf 

  48  Case  DE/2016/1934,  C(2016)8366 

https://circabc.europa.eu/sd/a/679cca47-d2c0-4895-a9fc-

4d5d1c10d922/DE-2016-1934%20Adopted_EN.pdf  

  49   The Maximum Transmission Unit is the size of the largest network layer protocol data unit that can be 
communicated  in  a  single  network  transaction.  The  standard  Ethernet  frame  MTU  has  1,500  Byte. 
The  higher  level  applications  can  use  this  transport  volume  per  frame  without  any  restrictions.  If  ie 
wholesale  seekers  want  to  add  additional  protocol  features  within  the  layer  2  protocol  element  they 
can make use of so called Jumbo-frames,  which allow for larger MTU. The additional space is used 
for  additional  protocol  features.  If  such  additional  frames  are  required  in  the  context  of  wholesale 
services,  where  layer  2  frames  are  encapsulated  by  additional  layer  2  frames,  this  has  to  be 
performed outside the higher layer data frame. By this no volumes will be taken away from the higher 
level data transfer space. Admitting larger MTU sizes brings the wholesale seeker into a comparable 
position  as  it  it  would  operate  its  own  equipment  and  making  full  use  of  the  MTU  size  for  further 
product differentiation.  

27 

 
                                                 
Technicalities of VULA products 

•  Availability per end customer access connection (up-time in %) 

•  Obligation to increase the backhaul capacity between the MSAN50 and BNG, in 

order to avoid contention51 

•  Multicast frame replication 

Concerning  ‘access  control’,  the  Commission  identified  the  following  features  that 
should be reflected in an offer in order for it to considered to functionally substitute for 
VULA: 

•  Control of service profiles and DSL profiles 

•  Fault management: diagnosis data, choice to change system parameters, MTR 
targets, definition of faults (severe fault: significant decrease of speed), inclusion 
of ESS (Elektronische Entstörschnittstelle) access into reference offer 

2.4  Metrics for assessing VULA specifications 

On  the  basis  of  the  EC  letter  to  the  German  authorities,  the  2015  BEREC  report,  and 
our  own  experience,  we  have  identified  the  following  characteristics  as  relevant  in 
comparing  VULA  specifications  and  drawing  conclusions  on  best  practice  as  regards 
the three core VULA criteria identified in the 2014 EC Explanatory Note. 

  50   MSAN: Multiservice Access Node aggregating the single copper access lines into a larger data (and 
voice)  stream  up  to  the  central  network.  An  MSAN  supports  additional  functions  compared  to  a 
DSLAM  (Digital  Subscriber  Line  Access  Multiplexer)  and  replaces  it  in  modern  copper  access 
networks.  The  MSAN  are  then  aggregated  at  an  Ethernet  switch  or  an  BNG  (Broadband  Network 
Gateway (see section 5.1). MSAN and BNG are used in case of LLU by the wholesale seekers also. 
In case of VULA they are intermediate equipment of the access provider. 

  51   Contention  refers  to  an  overbooking  situation  where  more  customers  demand  for  capacity  than  the 
link  or  the  systems  connected  to  it  can  transport.  In  such  case  priorities  help  the  important  traffic  to 
pass through, while less important traffic is delayed or deleted. In case of active wholesale access this 
contention  ratio  is  controlled  by  the  access  provider.  So  he  could  control  the  product  quality  of  the 
access seekers. Therefore he could be obliged to offer sufficient capacity so that the traffic is in effect 
uncontended at any time.  

28 

 
                                                 
Technicalities of VULA products 

Point of handover  Location of handover (eg cabinet, local exchange, regional level) 

Number of access seekers per handover point 

Common handover point for all VULA access technologies 

Common product family across all VULA access technologies 

Generic access 

L2 protocol 

Access seekers’ 
control 

Approach  to  contention.  Obligation  to  increase  backhaul  capacity  in  case 
of contention 

Number of VLAN per access seeker and end-customer, VLAN tagging52 

Maximum MTU size 

Dedicated  logical  connection  per  end  customer/availability  per  end  user 
connection 

Customer identification for each access seeker and its customer 

Multicast support: Frame replication functionality 

CPE by ANO 

Bandwidth  (potential  for  ANO  control),  Guaranteed  bandwidth  classes, 
symmetric bandwidth (for business) 

Control  of  service,  DSL  profiles  by  ANO,  traffic  prioritisation  ANO 
determined 

Security: ANO able to provide security means 

Fault management: ANO receives actual state reports of any access line, 
access  to  diagnostic  data,  clear  definition  of  faults,  SLAs,  KPIs  and 
compensation over repair times, clear fault definition 

BSS53 support (order interface) 

  52   VLAN  tags  are  an  address  extension  of  the  Layer  2  (Ethernet)  protocol  allowing  to  define 
subaddresses for networks within a network (Virtual Local Area Network, VLAN). The standard allows 
for an outer tag (S-VLAN) and an inner tag (C-VLAN) of the same size (4094 addresses), which can 
be managed independently. In case of a wholesale business the outer VLAN ie could be managed by 
the  access  provider,  and  the  inner  by  the  access  seeker.  This  allows  for  some  product  definition 
independence  between  access  provider  and  access  seeker.  But  both  will  not  get  the  full  address 
space available. They have to share it among themselves. In case of DT’s proposed use of the tags 
each  S-tag  identifies  and  addresses  one  end-customer  behind  a  handover  interface  –  which  is 
dedicated  to  one  access  seeker,  so  it  can  address  a  limited  number  of  end-customers  per  access 
seeker (max. 4094). There are no options that any S-tag could address a group of end-customers, as 
required for multicast support. The C-tags are free of use for the access seeker. These ie are typically  
used  to  separate  data,  video,  IP-TV  and  voice  traffic,  and  also  for  business  customer  VLANs.  4094 
VLAN is a quite high number per end-customer. It also allows to transparently transmit access seeker 
specific and end-user specific priorities (see Figure 4-5 and Table 4-1). Another subdivision of the S 
and C address spaces could enable ie to increase the number of addressable customers per access 
seeker or to establish additional Multicast VLAN.  

  53  Business  Support  Systems  (BSS)  manage  ia  the  order,  change  and  contract  termination  processes 
and  the  service  provisioning  in  an  automatic  manner.  Operation  Support  Systems  (OSS)  are  ia 
relevant  for  support  regarding  network  monitoring  and  failure  analysis  and  repair.  For  the  active 
elements in the access seeker’s value chain an interaction between the systems and processes of the 
wholesale partners should replace the complete internal process structure of the access seeker in a 
passive LLU access scenario.   

29 

 
 
                                                 
Technicalities of VULA products 

Additionally, on the basis that vectoring technology may necessitate forced migration to 
VULA  from  physical  unbundling,  and  noting  that  pricing  is  a  core  issue  affecting  the 
viability of VULA for access seekers as a potential substitute for unbundling,54 we have 
identified the following migration and pricing characteristics as relevant. 

Migration 

Advance notification 

Bulk Migration Planning 

Who pays for the migration cost? Compensation for stranded investment 

Migration KPI monitoring 

Price 

Price structure bandwidth dependant 

Monthly rental charge 

Relationship of the monthly rental charge to LLU 

In the following sections, we draw on these metrics to  

(i) 

compare VULA products in other jurisdictions;  

(ii) 

identify best practice (section 4); and  

(iii) 

benchmark the submitted German products to assess whether they meet the 
required characteristics identified (in (ii)). 

  54   This is acknowledged in the EC letter to BNetzA of December 2016 

https://circabc.europa.eu/sd/a/51112946-265d-45c7-9a2f-0e36592b4eb1/DE-2016-
1954%20Adopted_PUBLIC_EN.pdf 

30 

 
 
                                                 
Technicalities of VULA products 

3  VULA in Austria, Denmark and the U.K. 

In order to reach an informed view of what constitutes ‘best practice’ in the specification 
of  VULA,  we  studied  established  VULA  offers  in  three  countries,  and consulted  NRAs 
and access seekers on the importance of specific parameters and degree to which the 
specifications were perceived as meeting market demands.  

•  Section 3.1 describes the methodology for the cross-country comparisons 

•  Section 3.2 outlines the regulatory background to the VULA offers in the sample 

countries including the approaches taken to charge control 

•  Section  3.3  provides  an  overview  of  the  specifications  in  the  three  considered 

countries 

•  Section 3.4 describes approaches to the point of handover 

•  Section 3.5 details how the concept of ‘generic access’ has been implemented 

•  Section  3.6  describes  the  degree  to  which  access  seekers  have  control  in 

product development and innovation in the studied countries 

•  Section 3.7 considers approaches to migration; and 

•  Section  3.8  examines  pricing  for  the  considered  products  and  how  prices  for 

VULA compare with LLU 

Records  of  the  interviews  on  which  the  country  cases  were  based  are  included  in  the 
Annex 2 – Country interviews. 

3.1  Methodology 

3.1.1  Country selection 

As  shown  by  the  following  table  drawn  from  the  WIK/TNO  study  for  DG  Connect  on 
‘Access  and  interoperability  standards’,55  VULA  or  similar  local  bitstream  obligations 
have  been  mandated  across  a  number  of  countries  in  the  EU,  starting  with  the  UK  in 
2010,  and  most  recently  including  Spain,  where  the  NRA  mandated  VULA  for  non-
competitive areas in its Wholesale Local Access market analysis of 201656. 

  55   See 

https://bookshop.europa.eu/en/investigation-into-access-and-interoperability-standards-for-the-

promotion-of-the-internal-market-for-electronic-communications-pbKK0415763/ 

  56   Commission Decision concerning  Case ES/2015/1818 concerning market 3a, C(2015) 9722 final of 

18.12.2015 

31 

 
                                                 
Technicalities of VULA products 

Table 3-1 

Local bitstream/VULA obligations in Europe 

Country 

NRA 

Year 

Virtual unbundling 
obligation in  
case of … 

Local bitstream 
obligation in the 
case of … 

Consequences for the physical 
unbundling obligation 

UK 

Ofcom 

2010 

FTTC/B/H 

AT 

RTR 

2010 

FTTC/B 

- 

- 

BE 

BIPT 

2011 

- 

FTTC 

IT 

AGCOM 

2011 

FTTC/B/H 

SK 

TÚSR  

2012 

FTTH 

DK 

DBA 

2012 

FTTC/B 

MA 

MCA 

2012 

FTTC (during migration 
to FTTC only) 

FTTH (after ongoing 
Roll-out) 

- 

- 

- 

- 

EL 

IE 

EETT 

2012 

FTTC 

ComReg 

2012 

- 

FTTC/B 

AT 

RTR 

2013 

FTTH/B/C 

- 

DE 

BNetzA 

2013 

FTTC 

SE 

PTS 

2015 

Copper/FTTC Where 
physical unbundling no 
longer economically or 
practically possible (eg 
in case of vectoring) 

Non imposition of (physical) 
unbundling in case of FTTH-GPON

Release of SLU in case of 
overlapping coverage 

Release of SLU in case of FTTC 
and VDSL Vectoring 

Non imposition of (physical) 
unbundling in case of FTTH-GPON

Non imposition of (physical) 
unbundling in case of FTTH-GPON

Non-imposition of SLU in case of 
vectoring 

Non imposition of (physical) 
unbundling in case of FTTH-GPON

Release of SLU in case of FTTC 
and VDSL Vectoring 

Street cabinet: No SLU obligation if 
vectoring is applied or application is 
planned within next 16 weeks 

MDFs which are not unbundled: no 
LLU obligation if vectoring is applied

Release of SLU for frequencies 
above 2,2 MHz in case of FTTC 
and VDSL Vectoring 

NL 

ACM 

2015 

FTTC 

ES 

CNMC 

2015 

FTTH/GPON 
uncompetitive areas 

Non-imposition of SLU in case of 
vectoring  

Non imposition of (physical) 
unbundling in case of FTTH-GPON 

Source:  WIK – EUI Working Paper RSCAS 2014/69, updated April 2015 and February 2017 

In selecting comparative examples for this review, our aim was to identify VULA 
specifications  which  are  well-established  and  may  represent  ‘best  practice’,  as 
regards certain aspects of their specification and/or service levels. 

32 

 
 
 
 
 
 
 
 
 
 
 
 
  
Technicalities of VULA products 

On this basis, we identified VULA products in Austria, Denmark and the UK as being of 
particular interest. The reasons are that: 

•  All products were mandated at least three years ago, and therefore it is possible 

to gather evidence regarding their application.  

•  The products were subject to significant operationalisation efforts by the NRA in 
conjunction with industry working groups, in Austria it was added by an intensive 
dispute resolution with the NRA. 

•  There  has  been  significant  take-up  of  the  VULA  products  in  the  UK  and 

Denmark – although take-up in Austria remains low (Figure 3-1). 

•  A  study  of  specifications  in  the  2015  report  ‘Access  and  Interoperability 
standards’  shows  that,  compared  with  products  in  other  countries,  VULA 
products  in  Denmark  and  Austria  offer  a  relatively  high  degree  of  flexibility  for 
the access seeker to provide uncontended bandwidth, and in Denmark to freely 
set  charges  independently  from  those  of  the  SMP  operator.  Multicast  options 
were  available  in  all  three  countries.  Flexibility  for  the  access-seeker  is  an 
important characteristic in determining whether VULA may substitute (at least to 
some degree) for physical unbundling. 

33 

 
Technicalities of VULA products 

Figure 3-1 

VULA take-up in U.K., Denmark and Austria 

No. of lines

Fttx take-up in U.K., retail and wholesale

8.000.000

7.000.000

6.000.000

5.000.000

4.000.000

3.000.000

2.000.000

1.000.000

0

Jan 11

Jan 12

Jan 13

Jan 14

Jan 15

Jan 16

BT Retail fibre

Wholesale (VULA)

No. of lines
140.000

VULA take-up in Denmark

120.000

100.000

80.000

60.000

40.000

20.000

0

10000

9000

8000

7000

6000

5000

4000

3000

2000

1000

0

contended
contended
uncontended
uncontended
no. of lines
2014:  0
2015:  2
2016:  4

2014

2015

2016

Number of fixed access lines with virtual unbundling in Austria

9434

8178

6514

5055

3898

2892

1729

1178

823

231

2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 2016 Q2

Source: WIK, based on data of BT, DBA and RTR 

34 

 
 
 
 
 
Technicalities of VULA products 

We  have  therefore  focused  our  in-depth  analysis  on  these  three  countries.  Where 
relevant, we also highlight VULA characteristics in other countries, based on data from 
the 2015 BEREC report on Layer 2 Bitstream57 and the 2015 study by WIK and TNO 
for the European Commission on ‘Access and Interoperability. 58 

3.1.2  Interview process and questionnaire 

Data  on  the  VULA  offers  in  Austria,  Denmark  and  the  UK  was  collected  through  a 
review of the respective Reference Offers and validated through interviews with NRAs 
and access seekers, as shown in the following table.  

Table 3-2 

Interview partners 

Country 

UK 

Denmark 

Austria 

NRA 

Ofcom 

DBA 

RTR 

Access seekers 

Talk Talk, Vodafone 

Telenor 

Tele2 

Interviews  were  structured  based  on  the  guideline  shown  in  Annex  1.  In  addition  to 
validating  the  technical  characteristics,  an  important  objective  from  the  interviews  was 
to  understand  which  characteristics  were  considered  most  important  from  the 
perspective of NRAs and access seekers, and to gauge whether the characteristics of 
the  VULA  products  were  broadly  accepted  by  the  market  –  and  could  therefore  be 
considered as ‘good practice’.  

3.2  Background to the VULA offerings in Austria, Denmark and the UK 

VULA offerings in the three countries examined were imposed as a result of a finding of 
Significant Market Power in the market for Wholesale Local Access,59 60 under the ex-
ante  EU  framework  for  electronic  communications.  They  were  thus  applied  on  the 
incumbent  operator  as  a  remedy  to  promote  competition  in  retail  broadband  markets, 
and  were  not  explicitly  linked  to  receipt  of  state  aid,  although  incumbents  such  as  BT 
which  received  state  aid,  have  also  provided  VULA  under  the  same  specification,  in 
subsidized areas. 

Ofcom  was  the  first  to  put  forward  the  idea  of  mandating  an  obligation  to  provide  a 
virtual unbundled product, in cases where the architecture of the network does not allow 

  57   BoR (15) 133 http://berec.europa.eu/eng/document_register/subject_matter/berec/reports/5439-berec-
report-on-common-characteristics-of-layer-2-wholesale-access-products-in-the-european-union 

  58  SMART 

2014/0023 

http://publications.europa.eu/resource/cellar/d4367156-c012-11e5-9e54-

01aa75ed71a1.0001.01/DOC_1 

  59   Or  the  market  for  wholesale  (physical)  network  infrastructure  access  at  a  fixed  location  which 

preceded it. 

  60   Market 3a of the EC 2014 Recommendation on Relevant Markets 

35 

 
 
                                                 
Technicalities of VULA products 

physical  unbundling.  The  UK  national  regulatory  authority  formally  mandated  VULA  in 
the  context  of  the  2010  Review  of  the  Wholesale  Local  Access  market.61  Although 
Ofcom  established  the  main  parameters  for  VULA  through  its  regulatory  decision,  the 
subsequent  efforts  to  operationalize  it  were  facilitated  by  industry  working  groups  and 
the UK standards body the NICC.62 Initially, Ofcom permitted a flexible pricing regime 
for  VULA  on  the  basis  that  wholesale  charges  would  be  constrained  through  a 
combination of competition from other platforms (cable and copper unbundling) and an 
obligation  for  ‘equivalence’,  whereby  BT  was  required  to  consume  the  same  product, 
using the same systems and the same wholesale input prices as alternative operators. 
In 2015, Ofcom introduced rules which defined the minimum margin that BT must allow 
between the wholesale and retail charges for superfast broadband as well as outlining a 
monitoring process for VULA margins. 63 Ofcom has indicated that pricing issues will be 
considered in its upcoming WLA market review. 

The  Danish  NRA  DBA  imposed  VULA  in  areas  where  TDC  had  upgraded  the  copper 
network through a Decision in 2012.64 While high level principles were defined by the 
NRA,  much  of  the  detail  was  settled  through  industry  working  groups.  As  regards 
charges,  DBA  proposed  to  set  maximum  charges  for  VULA  based  on  an  approach  of 
cost-orientation  (LRAIC+),  but  with  costs  for  ducts  and  cables  valued  on  the  basis  of 
historic costs.65 It noted in this context that the market conditions combined with NGA 
investments  on  the  copper-based  network  would  limit  the  incentives  of  alternative 
operators to invest in their own infrastructure – and argued that the pricing principles for 
VULA should reflect this reality. In addition, DBA provided for specific rules relating to 
compensation  for  access  seekers  in  the  transition  to  VULA  in  cases  where  TDC’s 
network upgrades necessitated migration. 

VULA  obligations  were  first  applied  by  the  Austrian  NRA  RTR  in  2010  for  FTTC/B.66 
The  specification  of  the  VULA  product  was  elaborated  with  the  support  of  industry 
working  groups  as  well  as  the  intervention  of  the  NRA  to  resolve  disputes.  VULA 
charges  were  set  in  practice  on  the  basis  of  a  retail  minus  approach  subject  to  a 
maximum cap based on an FL-LRAIC cost model.67 An RTR decision in 2013 extended 

  61   Ofcom WLA statement 2010 

https://www.ofcom.org.uk/__data/assets/pdf_file/0027/37935/wla_statement.pdf 

  62   The NICC developed a set of standards for ‚Active Line Access‘, many (although not all) of which 

were reflected in the Openreach VULA specification, 
http://www.niccstandards.org.uk/publications/ala.cfm 

  63  Ofcom statement: Approach to the VULA margin 2015 

https://www.ofcom.org.uk/__data/assets/pdf_file/0015/72420/vula_margin_final_statement.pdf 

  64   See  Commission 

letter  https://circabc.europa.eu/d/d/workspace/SpacesStore/78bbff4d-f760-47ad-

85f5-07326a0d728d/DK-2012-1339-1340-1341%20Acte(3)_EN%252bdate%20et%20C.pdf 

  65   See Commission letter https://circabc.europa.eu/sd/a/2d1a5c47-c957-42b0-ae4b-

a4a2f0f868b0/Copy%20of%20Copy%20of%20DK-2012-1399%20Adopted_EN.pdf Electronic 
equipment would be valued at replacement cost 

  66   See  Commission  letter  https://circabc.europa.eu/sd/a/2f7ab427-ab43-4d71-bb9a-b1ffb89653fe/AT-

2010-1084%20Acte%20(3)%20EN%252bdate%20et%20n%25c2%25b0.pdf 

  67   RTR noted that in practice, due to constraints on the retail price from infrastructure-based competition, 
the  results  of  a  cost-model  were  likely  to  be  above  a  level  which  it  would  consider  to  be  margin 
squeeze 
https://circabc.europa.eu/sd/a/2f7ab427-ab43-4d71-bb9a-b1ffb89653fe/AT-2010-
1084%20Acte%20(3)%20EN%252bdate%20et%20n%25c2%25b0.pdf 

free 

36 

 
                                                 
Technicalities of VULA products 

the VULA obligation to apply also to FTTH and allowed A1TA to reject requests for sub-
loop unbundling (SLU) if A1TA proved that vectoring was currently used or was planned 
and would be implemented within 16 weeks following the request, and offered a virtual 
wholesale  product  with  features  the  same  as  those  based  on  vectoring  which  were 
offered  to  its  own  customers.  In  locations  where  subloop  unbundling  would  be 
deployed, A1TA could also proceed with its deployment if it could prove that vectoring 
would  be  introduced  in  the  following  16  weeks  and  if  access  seekers  were  offered 
migration, free of charge, to a wholesale product that was appropriate for them. A1TA 
was also required to provide compensation for potential stranded investments.68 

3.3  Overview of specifications 

A summary of key aspects of the VULA specifications in Austria, Denmark and the UK 
is  shown  in  the  table  below.  A  comparative  analysis  of  each  of  the  sets  of 
characteristics follows, drawing on feedback from the interviews which are recorded in 
full in Annex 2. 

  68   See  Commission  letter  https://circabc.europa.eu/sd/a/4451e0a4-7fd8-4f81-b243-76c053864b5b/AT-

2013-1475-1476%20Adopted_EN.pdf 

37 

 
 
                                                 
Technicalities of VULA products 

Table 3-3 

Core VULA characteristics in U.K., Austria and Denmark 

UK 

AT 

DK 

Point of handover 

Handover at subset of exchanges (984 
compared with 5,500 for LLU) 

MDF handover (same handover as LLU). 
Regional handover available soon.  

1G and 10G backhaul available 

3 VLANs 

MTU size 1534 

Can be configured so as to be uncontended, 
but increases cost 

Generic access 

Multicast operational and used 

Up to 4 VLANs 

MTU size 1580 

Multicast available, but not in significant use 

Handover available at cabinet, CO, regional 
and national. Regional handover used by 
Telenor. Cabinet not considered viable. 

10G backhaul available 

Uncontended (flat rate) and contended both 
available – but in practice only contended is 
used 

Up to 7 VLANs69 

MTU size 1600 

Multicast available but not used 

CPE freedom subject to testing 

CPE freedom 

CPE freedom subject to testing 

Bandwidths set by incumbent 

Bandwidths set by incumbent 

Access seekers’ 
control 

No symmetric offers 

Limited QoS levels 

Trialling line status reports, historic line 
statistics available (4h delay) 

KPIs (to ANO) with automatic 
compensation 

Symmetric available 

Line status reports on demand and daily 

No automatic compensation 

Freedom of configuration for access seekers 
for uncontended product 

Bandwidths set by incumbent for contended 
product 

Symmetric available 

Line status reports and line monitoring 
available 

No automatic compensation 

  69  BoR (15) 133 In case of the uncontended version of the L2 WAP, ANOs have the possibility to use inside a C-VLAN 4094 VLANs as a “third level” of VLANs.   

38 

 
                                                 
Technicalities of VULA products 

Migration 

Pricing 

UK 

AT 

DK 

No need for forced mass migration to date 
– nearly no vectoring 

Some cases arising due to ‘long reach 
VDSL’ – details have not yet been settled 
in industry forum 

Bulk migration process operational for 2 
years for forced migration – automatic, but 
requiring correction – no transfer cost 

Vectoring moving fast – requires migration. 6-
9 months notice given – ANO provides 
vectoring-enabled CPE and then line moved 

ANOs pay unbundling charge and receive 
same speed 

One-off cost for connection at head-end, 
but differentiated charges by bandwidth 

VULA pricing depends on bandwidth – 
significant steps 

Contended VULA pricing depends on 
bandwidth  

Currently flexible, subject to margin 
squeeze test reviewed by NRA. Ofcom 
considering cost-based charge control in 
the context of ongoing charge control 
proceeding.  

Limited VULA take-up attributed by ANOs to 
pricing 

Uncontended VULA available at flat charge, 
but not accepted by the market due to high 
infrastructure requirements (handover per 
DSLAM, not aggregated) 

39 

 
 
 
Technicalities of VULA products 

3.4  Point of handover 

A critical point which affects the economic viability of VULA is the point of handover – ie 
the location at which the alternative operator interconnects with the supplier of VULA. 

A  handover  point  at  or  near  the  MDF  (Main  Distribution  Frame)  site  indicates  that  the 
handover occurs close to the location at which physical unbundling of the copper local 
loop has been made available. An analysis of the usage of unbundling in Germany as 
well  as  in  other  comparable  markets  in  Europe  suggests  that  this  location,  which 
normally allows access to between 1,000-35,000 end-users is a viable interconnection 
point across a significant portion of the country (approximately 80% of the access lines 
are accessible through approximately 4,500 unbundled MDF locations of 7,900 in total 
in Germany), but may not be in rural and remote areas where the number of customers 
connected to the MDF sites are on the low end of this range. 

In  turn,  interconnection  points  which  are  even  closer  to  the  end-customer  –  such  as 
interconnection  at  the  street  cabinet  -  are  likely  to  be  less  widely  economically  viable 
than aggregation at the MDF as only 190 lines (national average) may be aggregated at 
such points, with even lower numbers aggregated in rural street cabinets. 

As  the  deployment  of  fibre  to  the  cabinet  enables  higher  speeds  and  higher  service 
quality  to  be  maintained  over  a  longer  distance  than  was  the  case  for  copper  local 
loops,  FTTC  (and  even  more  so  FTTH/B)  has  been  accompanied  with  a  trend  for 
operators  to  collect  traffic  at  aggregation  points  which  are  larger  (collect  a  higher 
number  of  lines)  than  was  historically  the  case  for  copper  lines.  Thus  the  concept  of 
‘local access’ has been extended in several countries beyond the connection from the 
customer  to  the  MDF,  reducing  the  number  of  points  of  interconnection  for  NGA 
compared with those available for LLU.70  

In  the  countries  studied,  the  UK  offers  handover  for  VULA  (called  Generic  Ethernet 
Access) at a subset of locations (parent nodes) where physical local loop unbundling is 
offered (just under 1,000, compared with 5,500 locations for LLU). This connection point 
was  considered  acceptable  by  the  two  alternative  operators  interviewed,  and  was 
considered not to be contentious by the NRA. SLU is essentially unused, and there is 
no VULA available at the street cabinet in the UK.   

While  cabinet  handover  for  VULA  is  available  in  Denmark,  this  product  is  not  used  in 
practice, and was in general not considered by the alternative operators interviewed for 
this analysis to be economically viable. Rather, VULA handover at the MDF site is the 

  70   The  concept  of  what  constitutes  ‘local  access’  has  been  a  live  debate  in  the  context  of  duct  access 
obligations  under  the  ex-ante  regulatory  framework  for  electronic  communications.  Whereas 
previously ‘local access’ was understood to extend from the network termination point to the MDF site 
in  a  copper  environment,  ‘local  access’  for  the  purposes  of  NGA  networks  is  now  acknowledged  in 
several countries including France and the UK as extending beyond the MDF site to the aggregation 
site for NGA purposes. 

40 

 
                                                 
Technicalities of VULA products 

main and today only VULA product71 used by Tele2 in Austria, while regional handover 
contended VULA is used by Telenor in Denmark in preference to MDF handover.72 

Although  it  is  technically  possible  to  maintain  the  same  characteristics  for  a  regional 
VULA  as  one  offered  at  a  more  local  handover  point,  there  is  more  scope  with  a 
regional  VULA  for  reductions  in  quality,73  due  to  the  potential  for  contention  in  the 
backhaul, and additional complexity in monitoring faults.  

In this context, it is interesting to note that the flat-rate uncontended VULA in Denmark 
is  limited  to  the  street  cabinet  and  MDF  handover,  while  only  contended  products  are 
offered at regional and national level.  

Another important factor in enabling access seekers to avoid contention as demand for 
bandwidth grows is the early availability of 10Gbit/s ports and associated backhaul from 
the point of VULA handover, whether at the cabinet, MSAN or a location similar to the 
BNG.  Vodafone  noted  that  it  had  considered  the  initially  available  1G  capacity  a 
limitation in the UK, although it had since been resolved. 

Alternative operators noted their preference for a single handover point for all available 
technologies  (including  technologies  under  development  such  as  G.fast)  and  a  single 
VULA  product  set  (with  variations  on  the  basis of  underlying  technology).  These  were 
generally available in the three countries considered. 

Conclusion: handover point 

Cabinet  handover  is  not  considered  to  be  economically  viable  on  a  widespread 
basis  by  alternative  operators.  Alternative  operators  prefer  to  have  the  option  to 
access VULA at the same location as LLU handover or at a subset of these locations. 
Handover  points  for  VULA  products  in  the  UK,  Austria  and  Denmark  reflect  these 
economic  preferences.  A  single  product  set  and  handover  point  for  all  technologies  is 
preferred.  Early  availability  of  10Gbit/s  backhaul  from  the  handover  point  is 
considered important to meet increasing bandwidth needs.  

  71   A new reference offer of A1 Telekom Austria (TA) from December 2016 already includes new regional 
handover points in the district capitals and in Vienna and a central access in Vienna active from May 
2017.  

  72   Telenor stated that its choice of regional handover was influenced by the lower complexity involved in 
using this product compared with local handover as well as economic reasons (relatively small price 
difference). Its decision may also have been influenced by its relatively small scale – having less than 
10% market share of the broadband market. In addition to handover at the Central Office and regional 
handover, national handover is also available for contended VULA. Uncontended VULA is available at 
the Street Cabinet and Central Office. 

  73   While  the  protocols  (such  as  treatment  of  VLANs,  MTU  size  etc)  are  not  affected  by  a  regional 

handover, traffic-related parameters such as contention and quality of service can be affected 

41 

 
                                                 
Technicalities of VULA products 

3.5  Generic access 

In  the  context  of  the  requirement  for  VULA  to  be  ‘generic’,  we  considered  for  the 
relevant countries (i) whether the product could be configured so as to be uncontended 
(ie  provide  guaranteed  downstream  and  upstream  bandwidth);  (ii)  how  many  VLANs 
were  available74;  (iii)  what  was  the  MTU  size;  and  (iv)  what  the  demand  for  and 
satisfaction with multicast facilities (required in some circumstances75 to offer IPTV). 

the  alternatively  operator  can 

As regards contention, an uncontended VULA (with a flat rate price) is available at local 
access  handover  points  in  Denmark  (alongside  contended  options).  The  uncontended 
VULA offers the closest substitute to physical unbundling, as the alternative operator is 
able to determine independently from the incumbent supplier the bandwidths and prices 
they make available to end-users. VULA in Austria can also be configured so as to be 
uncontended,  because 
the 
bandwidths in the network segments between the premise and street cabinet and street 
cabinet and ODF. However, pricing for different bandwidth tiers is set by the incumbent 
supplier.  Interestingly  however,  despite  the  option  for  uncontended  VULA,  alternative 
operators  in  Austria  and  Denmark  have  opted  for  contended  versions  due  to  the 
implications  on  the  wholesale  price,  and  –  in  the  case  of  Denmark  –  additional 
complexity.76  Likewise,  contention  in  the  incumbent  network  is  not  considered 
problematic by the alternative operators interviewed in the UK, notwithstanding the fact 
that bandwidth is shared from the OLT to the handover point77 78.  

independently  select 

Double  VLAN  tagging  is  available  in  all  the  countries  considered.  However,  there  are 
differences in the number of VLANs available. While up to 4 VLANs are available for the 
VULA  product  in  Austria,  only  3  are  available  in  the  UK,  while  was  considered 
problematic  by  Vodafone.  The  MTU  size  of  1534  in  the  UK  was  also  considered  by 

  74   See chapter 4.1 for a discussion of the relevance of VLAN arrangements and practical implications if 

availability is limited 

  75   Multicast avoids the need for multiple transmission of the same channels, thereby saving bandwidth. 
The  savings  are  increased  in  proportion  to  the  number  of  customers  (and  therefore  potential  TV 
viewers)  being  served  via  the  aggregation  point.  Savings  through  multicast  are  likely  to  be  limited  if 
handover  is  provided  at  cabinet  level,  where  only  a  small  number  of  customers  can  be  accessed. 
However  at  the  BNG  level,  multicast  would  likely  be  essential  to  ensure  efficient  transmission  of  TV 
content. 

  76   Telenor Denmark stated in the interview that although uncontended VULA offered more flexibility over 
the  product  definition,  they  decided  not  to  use  it,  because  “there  is  a  complexity  to  reach  each 
DSLAM, and they may need to pay for backhaul for 2 DSLAMs with only few customers, because they 
cannot determine DSLAM customer aggregation. Fibre ODFs and patch cords must also be ordered 
from TDC and are costly. They would need to introduce logic to analyse at which sites uncontended 
and  at  which  sites  contended  VULA  should  be  ordered.  This  would  create  excessive  complexity  for 
provisioning and OSS systems.” 

  77   A GPON network is a shared fibre FTTH/B access network where the OLT (Optical Line Terminator) 
administrates  the  sending  rights  per  end-customer.  GPON  offers  2,5  Gbit/s  down  and  1,25  Gbit/s 
upstream  bandwidth.  While  today  congestion  is  not  observed  this  might  come  up  with  increasing 
bandwidth  demand.  In  addition  the  interface  between  the  OLT  and  the  handover  point  could  also 
suffer from contention, when not dimensioned accordingly. 

  78   See WIK TNO 2015 for EC ‘Access and interoperability standards…’ 

42 

 
                                                 
Technicalities of VULA products 

Vodafone to be suboptimal in comparison with the MTU size of at least 1580 in Austria 
and Denmark.79  

Lastly,  as  regards  multicast,  this  is  considered  by  Vodafone  and  Talk  Talk  to  be 
operational in the UK, after a period of some years in which the specification was under 
development.80  However,  multicast  is  not  used  by  the  largest  alternative  operators  in 
Denmark  and  Austria.  Telenor  in  Denmark  stated  that  their  initial  decision  not  to  use 
multicast  was  in  part  due  to  perceived  high  pricing  of  the  product  when  it  was  initially 
launched.  However,  over  time,  this  decision  was  also  supported  by  increasing  trends 
towards  video  streaming  and  the  demand  to  use  the  same  solutions  for  mobile  as  for 
fixed, which tends to militate against IPTV solutions.   

Conclusion: generic access 

Alternative  operators  would  ideally  prefer  fully  uncontended  access,  but  use  and  are 
satisfied  with  contended  access  as  a  means  to  minimise  cost.  The  availability  of  4 
VLANs with double VLAN tagging is considered sufficient. The MTU size should be 
at least 1,580 Bytes. Multicast support is required in certain circumstances81, but 
multicast may be less relevant if streaming or non-IPTV broadcast solutions are 
prevalent. Multicast is also less relevant where handover is close to the end-customer. 
Where  multicast  is  needed,  attention  should  be  given  to  ensure  that  prices  are  not 
excessive. 

3.6  Access seekers’ control 

An  important  feature  of  physical  access  to  the  unbundled  copper  local  loop  is  that  it 
allows  considerable  scope  for  innovation  and  product  differentiation  by  the  access 
seeker by providing control over the bandwidths (including the ability to offer symmetric 
bandwidths).  A  crucial  test  as  regards  whether  VULA  offers  a  substitute  for  physical 
unbundling  is  therefore  whether  VULA  offers  flexibility  to  the  access  seeker  which  at 
least approaches that available through physical unbundling.  

In  assessing  the  characteristics  of VULA  benchmarks,  we  have  looked  in  particular  at 
the  degree  to  which  the  products  (i)  allow  alternative  operators  to  set  their  own 
bandwidths  and  to  offer  symmetric  bandwidths;  (ii)  enable  them  to  choose  CPE 
independently; (iii) provide scope to vary quality of service to address different service 

  79   The  Danish  MTU  size  for  VULA  is  1600.  However,  Telenor  Denmark  notes  that  the  MTU  size  for 

bitstream is 1500, which may create complexity for operators utilising both services. 

  80   In the UK the Multicast offer – which is available as an ‘add-on’ offers VLAN ID between 3001 ..3070, 

network operator will provide lowest available value. 
Bandwidth from 0..860 Mbit/s – WIK TNO 2015 for EC ‘Access and interoperability standards’ 

  81   Depends on the number of IP-TV customers of an access seeker behind a handover point, which is 
typically low on an MSAN level, but already higher at the MDF and in any case sufficiently high at the 
regional (BNG) level. The more IP-TV customers, the higher the bandwidth saving effect of multicast. 

43 

 
                                                 
Technicalities of VULA products 

or  customer  requirements82;  and  (iv)  provide  freedom  for  alternative  operators  to 
monitor the  state of their lines and receive automatic compensation if repair or quality 
thresholds fall below a given standard. 

As  regards  the  freedom  to  set  bandwidths  independently  from  their  supplier  (the 
regulated  incumbent),  we  note  that  this  is  only  possible  in  Denmark  by  using  the 
‘uncontended’ offer. Other products in Denmark and elsewhere83 tie the access seeker 
to speed and price tiers set by the incumbent. This limitation on flexibility was generally 
cited as a concern by the alternative operators interviewed for this study. For example, 
Talk Talk stated that it would prefer a single uncapped VULA product, leaving it for the 
alternative  operator  to  decide  how  to  use  it,  for  a  fixed,  bandwidth  independent  price. 
They noted that alternative operators had adopted the strategy of maximising bandwidth 
offered  in  the  provision  of  ADSL2+,  thereby  contributing  to  speed  competition  in  the 
market.  However,  they  observed  that  with  VULA,  BT  had  pursued  an  alternative 
strategy  of  setting  high  prices  for  higher  bandwidth  tiers,  which  they  considered  had 
reduced demand.  

Alternative  operators  in  Denmark  and  Austria  noted  that  there  was  demand  for 
symmetric bandwidths, primarily for business use. Such products were used by Tele2 in 
Austria,  although  not  by  Telenor,  as  its  volumes  for  such  lines  were  currently  too  low. 
Symmetric  options  are  not  available  for  VULA  in  the  UK,  although  Ofcom  noted  that 
operators can and do opt to market asymmetric products as ‘symmetric’ on the basis of 
the  upstream  bandwidths  available,  opting  not  to  advertise  the  higher  downstream 
capacity. 

Freedom  of  CPE  is  possible  in  all  the  countries  considered,  and  this  is  also  common 
practice in other countries as can be seen in the BEREC Report on Layer 2 bitstream.84 
A  standard  approach  is  to  permit  the  use  of  the  equipment  on  the  basis  of  a  whitelist 
published  by  the  access  supplier,  and  also  to  permit  additional  equipment  to  be 
included subject to testing. Access seekers were broadly satisfied with the approaches 
taken in the three countries studied, at least for FTTC, the predominant technology. For 
example, in Austria the reference offer includes a whitelist for network compliant CPE, 
as well as a list of standards for compliancy. Furthermore, access seekers can apply for 
CPEs to be approved. In general one can chose any CPE which satisfies the standards 
published, also for FTTH.  

Because  with  virtual  access,  alternative  operators  no  longer  control  the  active 
equipment, they do not automatically have access to information about the state of the 
line, and therefore cannot directly gauge whether quality standards are acceptable or a 

  82   For example,  business customers might expect a higher quality of service (in terms of jitter, delay and 

packet loss) and shorter repair times compared with residential customers 

  83  The tying of bandwidths to price tiers set by the incumbent  was found in all products assessed  with 
the  exception  of  Denmark  uncontended  in  the  2015  WIK  TNO  study  for  the  EC  ‘Access  and 
interoperability standards’ 

  84   BoR (15) 133 tables 6 and 7 

44 

 
                                                 
Technicalities of VULA products 

fault has occurred. In order to provide a degree of control over fault management in a 
VULA set-up, the access provider must provide an interface to the systems which report 
on  line state,  and  access  seekers must  adapt their  systems  to  be  able  to  receive and 
interpret the data. Systems to enable alternative operators to monitor the state of their 
lines have been implemented in the three countries reviewed. The system in Austria is 
currently the most advanced. Alternative operators in Austria receive status reports on 
access lines including technical parameters on demand, and a bulk data file is also sent 
daily.  This  enables  operators  to  conduct  their  own  fault  monitoring  and  reporting.  In 
Denmark, a system has been recently implemented which allows alternative operators 
to  monitor  their  own  lines85  and  obtain  statistics.  Meanwhile,  in  the  UK,  a  line 
monitoring  system  accessible  to  access  seekers  is  established,  but  according  to  the 
NRA  and  operators,  there  are  still  some  issues  over  the  timing  of  reporting,  since  the 
data is provided with a minimum time gap of 4 hours.  

The system for setting standards and incentives for efficient fault repair by the access 
provider  (SLA/KPIs86  and  SLGs87)    is  most  advanced  in  the  UK,  where  the  SMP 
operator must pay compensation automatically for provisioning or repairs which are not 
conducted within the period to which it has contractually committed. 88 In contrast, there 
is  no  automatic  compensation  for  late  repair  in  Austria  and  Denmark89.  The  Danish 
NRA DBA stated that extended obligations on SLA/KPIs and SLGs for VULA would be 
addressed  as  part  of  the  upcoming  market  analysis  for  market  3a  (Wholesale  Local 
Access). 

  85   According  to  Telenor  TDC  offers  GUI  and  API  access  to  the  Nokia  Network  Analyzer  suit: 

https://networks.nokia.com/products/motive-network-analyzer  

  86   Service  Level  Agreements  (SLAs)  can  include  contractual  commitments  to  provision  wholesale 
access  and  conduct  repairs  within  given  timescales.  Key  Performance  Indicators  (KPIs)  are  metrics 
which  are  required  to  be  made  available  by  the  access  provider  concerning  the  actual  provisioning 
and repair times and the relationship of such with contractually committed times. 

  87   Service  Level  Guarantees  (SLGs)  are  contractual  commitments  to  pay  compensation  to  the  access 
seeker  when  provisioning,  repair  and  other  quality  of  service  parameters,  fail  to  meet  contractually 
committed standards. 

  88   The access seeker may choose from different service maintenance options. 
  89   According to analysis from WIK TNO 2015 ‘access and interoperability standards’ report, SLAs exist 

for VULA fault repair in Austria and Denmark, but compensation is not automatic  

45 

 
                                                 
Technicalities of VULA products 

Conclusion: control of access 

A  core  problem  with  VULA  products  as  currently  defined  in  nearly  all  cases  (with  the 
exception of uncontended VULA in Denmark) is that the bandwidths offered by access 
seekers  are  tied  to  bandwidths  and  pricing  tiers  set  by  the  incumbent.  A  system  of 
uncapped  bandwidth  with  flat  rate  pricing  would  offer  more  flexibility  –  similar  to 
physical unbundling - and would be preferred by access seekers, providing the price is 
not  excessive.  This  would  also  enable  access  seekers  to  freely  offer  a  range  of 
symmetric  offers.  Access  seekers  should  ideally  have  access  to  line  state 
monitoring on demand and with daily updates. There should also be service levels 
for  fault  repair  with  automatic  compensation  if  access  providers  do  not  address 
faults  within  the  given  timeframe.  Free  CPE  subject  to  a  whitelist  or  testing  by  the 
access provider is standard practice. 

3.7  Migration 

Processes  for  migration  (including  bulk  migration)  from  physical  unbundling  products 
are  important  in  ensuring  an  effective  implementation  and  take-up  of  VULA,  and 
essential in cases where technological upgrades interfere with physical unbundling, and 
therefore  compel  access  seekers  to  move  to  VULA.  Examples  of  upgrades  which 
interfere with unbundling include vectoring solutions installed at the street cabinet which 
interference  with  the  ability  to  use  SLU.  LLU  may  also  be  rendered  unusable  when 
VDSL Vectoring is implemented in ‘unshaped’ mode.   

Of  the  countries  studied,  Austria  appears  to  have  the  most  developed  migration 
processes.  According  to  Tele2,  there  is  a  well-established  set-up  for  both  regular  and 
forced migration, which is becoming increasingly prevalent due to the use of ‘unshaped 
mode’  for  VDSL  Vectoring  deployments.  The  incumbent  provides  a  list  of  customers 
affected by the update project, and alternative operators can then run a process for bulk 
migration which is automated, although requires some manual correction, according to 
Tele2. In the event of forced migration, alternative operators continue to pay the fee for 
physical unbundling and receive a VULA which offers the same speed as was available 
through  physical  unbundling.  There  is  no  additional  transfer  cost,  but  alternative 
operators must finance their internal costs, such as the adaptation of technical systems 
and provision of information to the customer. According to the NRA, RTR, the migration 
process is monitored through specific KPIs. 

The  Austrian  NRA  notes  that,  when  forced  to  migrate,  alternative  operators  prefer  to 
migrate all their customers in a Local Exchange from LLU to a virtual access product. 
This  has  resulted  in  demand  for  product  support  for  existing  POTS  and  ISDN 
customers, which is currently the subject of a request to A1 TA. 

46 

 
Technicalities of VULA products 

Forced  migration  has  also  been  an  issue  in  Denmark,  where  the  rapid  installation  of 
vectoring  has  required  migration  to  a  ‘forward  access  point’.  DBA  notes  that,  initially, 
practical problems such as system errors occurred because the migration process had 
not  been  prepared  or  tested  sufficiently.  DBA  aimed  to  prevent  such  problems 
reoccurring  in  a  vectoring  decision  of  2013.  The  vectoring  decision  obliges  TDC  to 
conduct tests on wholesale migration routines, ordering systems and processes before 
upgrading  customers.  They  are  also  required  to  give  notice  to  alternative  operators 
before conducting the tests, and to include alternative operators in the testing process. 
The results are reported in the VULA forum. DBA is also considering more formal KPIs 
for migration in the context of the ongoing market review procedure. 

In contrast with Austria and Denmark, the UK has not yet put in place systems for bulk 
migration from LLU to VULA. Ofcom and alternative operators note that it has not been 
a  significant  issue,  since  there  has  been  no  forced  migration  (and  vectoring  is  not 
implemented). However, debates have begun on migration conditions as a result of an 
exchange closure which would require an upgrade because the new exchange location 
would result in lines which are too long to support ADSL from the MDF. Bulk migration 
might  also  become  relevant  in  the  future  with  the  installation  by  the  incumbent  of 
G.fast.90 

Forced  migration  generally  spurs  a  discussion  concerning  the  treatment  of  ‘stranded 
assets’,91  and  the  extent  to  which  the  access  provider  compelling  the  migration  must 
compensate for associated costs. 

Conclusion: Migration 

Processes  should  be  put  in  place  to  enable  migration  from  unbundling  to  VULA  – 
including automated processes for bulk migration in the event that forced migration 
may  occur.  Sufficient  notice  should  be  given  prior  to  forced  migration,  and  the 
processes  should  be  tested  (involving  alternative  operators)  in  advance.  Migration 
processes  should,  especially  if  there  is  forced  migration,  be  subject  to  specific 
monitoring  KPIs.  Migration  processes  should  address  the  issue  of  stranded  assets. 
Forced migration should not result in alternative operators being obliged to pay more for 
the service post migration – although the service could be ‘capped’ to reflect previous 
performance. In the event of forced migration, solutions should be found to support 
customers  of  POTS  and  ISDN,  thereby  allowing  all  customers  to  be  transferred  to 
virtual solutions. 

  90   This will depend on the frequency ranges used for VDSL and G.fast 
  91   Stranded  assets  includes  equipment  previously  installed  for  ADSL  provision  as  well  as  backhaul 
infrastructure which has been installed or rented by the access seeker with a long-term commitment, 
but  which  is  no  longer  required  due  to  a  change  in  handover  points  when  migrating  to  an  NGA 
wholesale product. 

47 

 
                                                 
Technicalities of VULA products 

3.8  Pricing 

VULA  pricing  is  considered  to  present  challenges  by  alternative  operators  in  all  the 
countries researched. Alternative operators in the UK and Austria highlighted concerns 
over  high  charges  especially  for  higher  bandwidth  tiers,  and  the  control  of  the 
incumbent over setting prices for specific bandwidths. This was considered to be more 
reflective  of  a  ‘retail  minus’  regime,  and  prevented  the  pricing  flexibility  that  was 
possible using physical unbundling. 

In the UK, charges for VULA are added to the charge for LLU or WLR92, resulting in a 
significant  wholesale  mark-up  for  40Mbit/s  VDSL  VULA  speeds  above  the  speeds  (of 
around 20Mbit/s) achievable through LLU with ADSL. Charges for 100Mbit/s VULA are 
around three times those for LLU93. 

Figure 3-2 

Copper LLU and FTTC/FTTP VULA monthly rental UK 2017 

Source: WIK based on Openreach price list 

  92   Wholesale Line Rental 
  93   Although a 100Mbit/s VULA would offer speeds around seven times higher than typically achievable 
via ADSL on LLU, WIK modelling as well as the results of a BU-LRIC+ FTTH/B cost-model used to set 
copper  access  charges  by  PTS  in  Sweden,  suggest  that,  it  is  unlikely  that  FTTH/B  costs  would  be 
significantly higher than copper costs in the access network. Such cost-modelling exercises also tend 
to suggest that there would be limited cost-justification for price tiering in the access network from the 
end-customer  to  MSAN,  as  costs  in  this  portion  should  be  relatively  bandwidth  independent.  Some 
price  tiering  might  however  be  expected  in  the  backhaul,  depending  on  the  degree  of  bandwidth 
booked. 

48 

 
 
 
 
                                                 
Technicalities of VULA products 

Similarly, in Austria, there has been a large gap between LLU rental charges, which are 
amongst  the  lowest  in  Europe,  and  charges  for  basic  VULA  at  speeds  of  30Mbit/s94. 
The  gap  is  set  to  decrease  in  May  2017  after  changes  to  the  charging  regime  are 
introduced,  bringing  significant  reductions  in  prices  alongside  increased  bandwidth. 
However, charges for 40Mbit/s contended VULA would still be nearly double those for 
LLU, with the charge for an uncontended 40Mbit/s product higher still. 

Figure 3-3 

Austria VULA charges 2016 and May 2017 

Source: WIK based on TA RO, Assumed overbooking ratio 1:5, 10 customers per DSLAM, C=contended, 

UC= uncontended 

It is interesting to note that the gaps between different VULA speeds are considerably 
lower in Denmark than in the other two countries considered. This may be as a result of 
the application of cost-orientation as the main pricing methodology, in contrast with the 
other countries considered.95 

  94   In Austria, as well as Denmark, there is a single charge for VULA comprising copper as well as fibre 

elements, and no requirement to purchase LLU or SLU in addition 

  95   In Austria charges are capped at a cost-oriented rate, but in practice set on the basis of retail minus 

as a measure aimed at avoiding margin squeeze 

49 

 
 
 
 
                                                 
Technicalities of VULA products 

Figure 3-4 

Copper LLU and FTTC/FTTP VULA monthly rental Denmark 2017 

Source: DBA, 7.43 DKK/€, 10 custom ers per CO/SC for uncontended VULA 

The Danish VULA is the only example studied which offers a range of handover points 
(street cabinet, MDF site, regional and national). However, as the chart above shows, 
there  are  relatively  limited  differences  in  the  charges  between  different  handover 
points.96  However,  this  brings  its  own  challenges,  with  Telenor  stating  that  relatively 
limited  price  savings  (alongside  complexity)  contributed  to  its  decision  to  use  regional 
contended VULA rather than the uncontended local access product. Telenor also claims 
that  the  degree  of  tiering  in  bandwidth  at  the  wholesale  level  does  not  match  pricing 
trends at the retail level, making it challenging to compete. Telenor would prefer a flat-
rate pricing model, if it could be offered at an affordable rate. 

Conclusion: pricing 

High  charges  for  VULA  in  relation  to  LLU  presents  a  major  hurdle  to  its  take-up  by 
alternative  operators.  The  tying  of  bandwidths  to  charges  at  the  wholesale  level  also 
limits  price  competition  and  flexibility  for  alternative  operators.  This  contrasts  with  the 
pricing  flexibility  that  has  historically  been  possible  with  physical  unbundling.  National 
authorities should ensure that the difference between LLU and VULA charges do 
not  deter  take-up.  VULA  charges  should  ideally  be  set  on  a  flat-rate  (bandwidth 
independent) basis, whereby the access seeker is free to determine bandwidths (and 
associated  retail  prices)  subject  only  to  the  technological  limitations  of  the  underlying 
infrastructure.     

  96   It  could  be  expected  that  additional  costs  would  apply  to  different  handover  points,  reflecting  the 
additional connectivity and active equipment that  would be included for a regional as opposed to an 
MDF-located handover point for example. 

50 

 
 
 
 
                                                 
Technicalities of VULA products 

4  Best practice VULA 

Basing  on  the  defined  metrics  we  have  drawn  on  the  experience  of  the  countries 
analysed  in  section  3  above  as  well  as  the  German  BMVI  market  consultation 
accompanying  the  state  aid  VULA  submission  from  Spring  2016  to  derive  a  best 
practice  VULA  which  might  be  applied  for  the  state  aid  cases  which  involve 
architectures and/or technologies which are incompatible with physical unbundling.  

Based  on  the  metrics  identified  in  section  2,  we  have  structured  the  best  practice 
guidelines into five key topics: 

•  Section 4.1 discusses the point of handover 

•  Section 4.2 describes what is implied by ‘generic access’ 

•  Section 4.3 discusses access seekers’ control 

•  Section 4.4 considers migration 

•  Section 4.5 discusses price issues 

In  defining  a  best  practice  specification  our  aim  is  to  reduce  the  disadvantage  access 
seekers  face  when  they  are  not  able  to  use  the  capabilities  of  a  physically  unbundled 
local access product. The reason for the disadvantage is that when a physical product 
is substituted by a virtual product, the access provider adds active electronic equipment 
onto  the  physical  access  connection.  This  equipment  is  typically  selected,  planned, 
installed and operated by the wholesale provider, without the participation of the access 
seeker97.  In  turn,  this  creates  challenges  for  the  access  seeker  to  differentiate  its 
products  and  innovate  in  terms  of  bandwidth,  quality  and  service  levels.  Best  practice 
conditions  are  intended  to  provide  practical  solutions  which  overcome  to  some  extent 
the restrictions on product differentiation an access seeker faces due to a migration to 
active  wholesale  access.  They  cannot  however  provide  a  perfect  substitute.98 
References to best practice in the following sections refers to best practice VULA. 

  97   Wholesale seekers typically cannot interact with the suppliers formulating their specific demand for the 
equipment’s  characteristics  (e.g.  multi-tenancy)  during  a  purchase  process.  So  if  such  features  are 
developed or not is a question of demand of the incumbent wholesale providers, not of the wholesale 
seekers or the regulators. 

  98   This  compromise  is  to  be  seen  in  the  context  of  the  higher  bandwidth  achievable  with  Vectoring  on 
copper  access  lines  –  to  the  benefit  of  the  end  customers,  and  the  more  rapid  achievement  of  the  
DAE targets and with lower investment than with an FTTH deployment. 

51 

 
                                                 
Technicalities of VULA products 

4.1  Point of local handover 

Historically,  alternative  operators  have  relied  for  most  broadband  access  connections 
on  local  loop  unbundling  (LLU)  –  physical  access  to  a  unique  copper  line  at  the  MDF 
site.  This  is  the  case  in  Germany,  where  more  than  half  of  the  MDFs  terminating 
approximately  80%  of  the  access  lines  in  Germany  have  been  accessed  by 
competitors. However, new copper based transmission technologies (VDSL, Vectoring, 
G.fast,  XG.fast)  are  often  (although  not  always)  deployed  in  a  manner  which  involves 
additional fibre segments replacing the old main or feeder cables between the MDF and 
street  cabinets  or  locations  even  closer  to  the  customer  premises.  The  fact  that  the 
copper  line  is  partly  replaced  by  fibre  means  that  physical  unbundling  at  the  former 
MDF  site  is  no  longer  possible  for  the  upgraded  FTTx  network99.  A  key  question  is 
therefore  how  to  define  a  suitable  substitute  which  could  be  used  by  alternative 
operators in place of local loop unbundling for higher bandwidth connections.   

One of the key characteristics of VULA, and one of the conditions for it to substitute for 
LLU, is that it should be available at a ‘local’ handover point. The concept of ‘local’ has 
not  been  precisely  defined  at  EU  level.  However,  it  has  been  interpreted  by  DBA  in 
Denmark and RTR in Austria to include a handover point at the MDF site – ie the same 
location as the handover for local loop unbundling, while Ofcom defined the connection 
point  as  being  in  ‘the  local  serving  exchange  where  the  first  Ethernet  switch  is 
located’.100  Also  in  the  Explanatory  Notes  of  the  2014  Market  Recommendation  the 
European  Commission  explained  that  “the  number  of  interconnection  points  does  not 
necessarily need to be equivalent to the copper network's points of interconnection". In 
this respect, the Commission did not criticise the proposed number of handover points 
(900)  as  an  impediment  for  the  L2  access  product  to  be  a  functional  substitute  for 
physical unbundling101.   

VULA  can  also  be  offered  at  the  street  cabinet.  However,  this  handover  point  was 
available in only one of the surveyed countries (Denmark) and was not used. 

The reason for the limited use of street cabinet VULA is the limited economic viability for 
alternative operators to duplicate infrastructure beyond the MDF site due to decreasing 

  99   In Germany the unbundled copper lines used for low speed frequencies up to 2,2 MHz remain in use. 
These  are  unaffected  by  Vectoring.  VDSL,  operating  in  the  frequencies  above  2,2  MHz,  must  be 
removed (in LLU and SLU applications, see section 5). DT has an active program to replace even the 
low speed access lines by migrating the customers to MSANs replacing POTS and ISDN telephony by 
VoIP.  This  program  was  planned  to  be  completed  in  2018,  but  this  period  may  be  extended.  In 
general one can assume that at least DT will not continue using copper feeder and main cables in the 
longer  term.  For  DT,  it  would  be  rationale  in  this  case  to  remove  the  copper  cables,  at  least  where 
deployed in ducts. However, only a minor share of copper cables in Germany is deployed in ducts. 

100   Ofcom notes that this location will not necessarily be the same local serving exchanges as for copper 
loops, because fibre does not have the same distance limitations as copper and as such it is possible 
to carry the access connection over a greater distance and thus achieve a higher level of aggregation 
at the local serving exchange –  
See WLA consultation 2010 https://www.ofcom.org.uk/__data/assets/pdf_file/0017/33605/Review-of-
the-wholesale-local-access-market-.pdf 

101   See case (DE/2016/1876) 

52 

 
                                                 
Technicalities of VULA products 

scale economies (see discussion in section 6.3.2). While an MDF site allows an access 
seeker to connect to more than 1,000 customers (and up to 35,000 in some locations in 
Germany),  street  cabinets  typically  serve  only  a  few  hundred  –  with  lower  numbers  in 
rural  areas  where  state  aid  may  be  required.  The  same  economic  challenges  have 
resulted in relatively limited use of physical access at the street cabinet (SLU), except 
where  used  by  a  first  mover  in  rural  areas  (ie  a  potential  recipient  of  state  aid)  or  in 
densely  populated  areas  which  lack  historic  infrastructure-based  competition  from 
cable, such as Italy. As a case in point, we note that in Germany just 1% of broadband 
lines have been supplied on the basis of subloop unbundling. 

Compelling  competition  based  on  VULA  to  take  place  on  the  basis  of  access  at  the 
street cabinet alone, especially in areas requiring state aid, would likely result in limited 
take-up of the offer and a reduction in competition in the areas concerned. If and where 
used,  it  would  result  in  stranded  LLU  investment  for  collocation  spaces,  distribution 
frames  and  traffic  aggregating  equipment  (e.g.  DSLAMs)  and  require  additional 
investment or cost. 

On this basis, we conclude that handover for VULA  should be available at least at the 
MDF level, an equivalent level to local loop unbundling. The option of handover at the 
cabinet  might  be  a  reasonable  option  from  the  perspective  of  enabling  alternative 
operators to climb the ladder of investment over time. However, it should be recognised 
that handover at the street cabinet is likely to be utilised only if and where the economic 
conditions  allow  for  a  profitable  business  for  a  second  mover  in  NGA,  which  may  be 
limited in less dense areas. 

If there is no option for a local handover at the MDFs it might be acceptable to handover 
the traffic at a higher (regional) network level, e.g. at the BNG-level (in U.K. the parent 
node  level),  provided  this  does  not  imply  any  constraints102  regarding  the  wholesale 
access product quality103104.  

The size and number  of handover interfaces should be determined by the capacity 
required  by  the  end-customers  of  each  wholesale  access  seeker105.  They  should  not 

102   Between  MDF  or  cabinet  MSAN  and  a  regional  handover  point  there  is  an  additional  thread  of 
contention which can affect access connection quality. There is also an additional active backhaul line 
element  which  is  implemented  and  operated  by  the  access  provider  and  which  is  not  directly 
controlled  by  the  access  seeker.  This  may  cause  additional  operative  disadvantages  (ie  regarding 
provisioning, fault management).  

103   One  could  state:  FTTH  point-to-point  would  be  the  ideal  future  proof  access  network  infrastructure. 
Because  of  its  relatively  length  independence  broadband  transmission  capability  these  lines  could 
also  be  aggregated  at  a  higher  network  level  (e.g.  the  BNG  nodes)  and  could  be  offered  in  an 
unbundled manner. Any architecture on the migration path to this high capacity and highly competitive 
access  infrastructure  therefore  should  support  such  wholesale  approach  as  soon  as  possible.  With 
this target in mind one can doubt if any competitor will invest in FTTC, unless his goal is to realize the 
FTTH target.  

104   Providers  other  than  the  incumbent  do  not  offer  their  handover  at  an  incumbents  location  (MDF, 
BNG),  but  at  another  location  of  their  network,  equivalent  to  these  network  levels  (regarding  the 
degree of aggregation and technology). 

105   If the sum of uncontended bandwidth behind a handover point exceeds the handover port capacity the 

access seeker has to decide for an upgrade in handover port capacity or number of ports. 

53 

 
                                                 
Technicalities of VULA products 

depend  on  the  access  network  architecture  of  the  wholesale  provider  or  on  the 
technology  mix  it  deploys.  In  an  LLU/SLU  use  case  access  seekers  are  free  to 
determine  themselves  how  they  aggregate  traffic  and  can  scale  systems  according  to 
their own market share and future product roll out and growth plans, thereby optimizing 
technological,  operational  end  economic  efficiency.  The  VULA  wholesale  access 
product  should  be  supplied  according  to  a  single  product  family  description  (for  all 
current and potential future technologies) and should only be differentiated according to 
the  technical  capacities  that  different  access  technologies  allow.  This  simplicity  would 
be at least comparable to the former LLU/ SLU operational homogeneity. 

The  number  of  wholesale  access  seekers  per  handover  location  should  not  be 
limited  in  order  to  ensure  that  access  is  non-discriminatory.  If  there  are  more  access 
seekers than originally envisaged, the handover infrastructure can be expanded to meet 
the  increased  demand.  Resulting  costs  could  be  distributed  amongst  all  wholesale 
users of the infrastructure106. 

4.2  Generic access 

The tasks for communicating between electronic systems are complex. The procedures 
and signals used are called communication protocol. In order to enable the combination 
of different technologies, technological improvements and usability for a wide range of 
applications  within  one  connecting  network  the  protocols  are  structured  into  layers  of 
dedicated 
the 
International Standards Organisation (ISO) defined a communication protocol reference 
model  for  Open  System  Interconnection  (OSI)  which  still  is  valid  and  used  today.  It 
includes seven layers and the infrastructure (Figure 4-1).  

functions,  which  complement  each  other.  Some  decades  ago 

Figure 4-1 

OSI seven layer reference model of communication protocols 

End-System

1 Application:

The software to be used by end users

6

5

4

3

2

1

0

Presentation:

Agrees and operates how to stucture data during exchange

Session:

Controls the exchange of data between Applications

Transport:

Controls the exchange of data between end-systems, loss of data

Network:

Transports and switches data over intermediate systems to end nodes

Link:

Physical:

Logical control of data flow and media access between neighboring
nodes

determines electrical and/ or optical signal access to the transmission
medium 

Infrastructure:

Passive physical infrastructure (copper/ fibre strand, cable, duct, 
trench)

106   The more wholesale seekers demand access the closer to the end-customers the less profitable the 

market might become. But that should be decided by the market forces. 

54 

 
 
 
                                                 
Technicalities of VULA products 

Source: WIK 

One  important  layer  is  the  network  layer,  numbered  as  layer  3.  Almost  all  of  today’s 
networks  have  been  migrated  towards  IP  (Internet  Protocol).  The  network  protocol 
organises  the  end-to-end  communication  in  the  wide  area  network  (WAN)  over  many 
network  nodes  –  not  only  within  a  country  but  also  internationally.  Due  to  its  mass 
market acceptance the layer below (Layer 2) is implemented today almost everywhere 
as the Ethernet Protocol. Ethernet protocol was originally been designed for Local Area 
Networks (LAN). However, its application was later expanded to become a general link 
layer  protocol.  It  is  the  last  layer  above  the  link  specific  transmission  protocols  and 
electro-physical  line  signal  protocol  level  (Layer  1).  The  different  infrastructures  were 
not included in the original ISO model, but we show them below under the title layer 0 
(Figure 4-2). 

Figure 4-2 

OSI communication interworking, layer per layer or peer-to-peer 

End

Intermediate

End

1 Application

1 Application

6

5

4

3

2

1

0

Presentation

Session

Transport

Network

Link

Physical

Infrastructure

3

2

1

0

Network

Link

Physical

Infrastructure

6

5

4

3

2

1

0

Presentation

Session

Transport

Network

Link

Physical

Infrastructure

Source: WIK 

55 

 
 
 
 
 
Technicalities of VULA products 

Figure 4-3 

OSI protocol sublayers, details 

For each level there exist a wide range of functions and protocoll
implementations, allowing for adapting to new technologies

3 Network

Real Time (RTP), Diffserv

Routing protocols (Link State (IS-IS), Distance Vector (OSPF, BGP)

2

Link (IEEE 802.x)

Multicast (IGMP)

Logical Link Control (LLC)

Media Access Control (MAC), Media Access

Physical coding sublayer,

1 Physical

Physical medium attachment

Physical medium dependant

Strands (copper pairs, fibre, microwave radio, coax networks)

0

Infrastructure

Cables (individual or shared media, size, …)

Ducts (single use or subdivided)

Trenches (direct burried, ducts, aerial)

Source: WIK 

Each layer could be considered to be like an envelope which contains information which 
can only be interpreted through the protocol layer software to which it belongs. These 
envelopes are also called packets (layer 3) or frames (layer 2).  The telecommunication 
protocols work in a hierarchical manner. The envelope (frame) for the Ethernet protocol 
(Layer  2)  is  enclosed  by    layer  1  and  itself  encloses  layer  3,  which  also  includes  the 
upper layer envelopes.  

In  principle  nobody  is  looking  into  the  other  layer  envelopes.  Sometimes,  there  is  a 
need  to  include  additional  information  on  how  to  handle  frames  or  packets  in  the 
protocol.  This  is  the  case  when  an  operator  wishes  to  establish  and  ‘address’  (apply 
tags  to)  additional  virtual  LAN  (VLAN)  and  when  offering  MPLS107  (Figure  4-4). 
Because  such  additional  information  should  not  reduce  the  transport  space  for  higher 
level  information  (i.e  should  not  reduce  the  size  of  the  envelope,  or  cause  significant 
changes  in  the  software  and  systems  of  the  layer  above)  larger  Ethernet  frames  are 
required. Figure 4-5 describes the double tagged Ethernet frame as it is demanded for 
in the VULA environment. It offers two address spaces for VLAN, each of 12 bits. The 
outer  (first)  one  is  called  S-tag,  the  inner  C-tag.  In  case  of  wholesale  access  typically 
the outer is used by the access provider, the inner by the access seeker. Because both 
parties  operate  on  layer  2  they  in  principle  could  agree  upon  a  different  use  of  the 
address space. While the standardized MTU size of Ethernet is 1500 bytes, the option 
of using a larger size gives additional flexibility to design the communication product on 
a layer 2 level. Common predefined uses include double VLAN tagging and MPLS VPN 
(Virtual  Private  Networks  –  used  for  secure  links  for  business).  Additional  address 
space  would  leave  room  for  future  creativity,  ie  for  MPLS  extensions,  larger  labels  or 

107   MultiProtocol  Label  Switching,  a  methodology  for  predefining  network  pathes  in  a  WAN  by  adding 

address labels for the pathes in front of the frames or packets.  

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Technicalities of VULA products 

stacked  labels,  additional  L2  VLAN  tags  for  business  customer  products  or  new 
residential  end-customer  products,  etc..  While,  in  an  LLU  environment  each  operator 
could  decide  itself  on  the  setting  the  MTU  size,  subject  only  to  the  limitations  of  its 
equipment,  this  parameter  is  controlled  by  the  access  provider  in  the  case  of  active 
access products such as VULA.  

Figure 4-4 

Protocol enveloping of Layer1 – 3 and additional Layer 2/3 address 
functions (VLAN tagging and MPLS) 

Protocol headers

Trailer

Layer 1

Layer 2

Ethernet

s
g
a
T

S
L
P
M

Layer 3

IP

Layer 4 – 7 +

TCP, UDP

Message Transfer Unit (MTU)

Ethernet Frame

Source: WIK 

Packet  switching  (ie  of  Ethernet  frames  or  IP-packets)  is  a  methodology  which  allows 
the traffic of many users to be sent via the same connection. This requires a method to 
organize  in  which  order  packets  are  sent.  Who  is  sent  first  is  organized  by  a  queuing 
system  (ie  first  in,  first  out).  This  system  could  be  supported  by  allocating  priorities  to 
the packets (higher priorities sent first) and/or by allocating a minimum bandwidth to the 
different priority groups so that it is guaranteed that all priority groups are guaranteed a 
minimum  transport  capacity.  These  kinds  of  queuing  tools  can  also  be  applied  to 
establish quality of service (QoS) for Virtual Private Networks (VPN). The application of 
queuing systems results in a delay before the packets are transmitted. This delay may 
not be constant, but vary over time (jitter) and if a link becomes congested (contended), 
packets  can  be  discarded  (packet  loss)108.  Delay,  jitter  and  packet  loss  are  the  main 
parameters describing the quality characteristics of packet transmission systems.   

108   The variation of the delay is called jitter, discarding of packets result in a packet loss, which also may 

be caused by electromagnetic interference on copper lines.  

57 

 
 
 
 
 
                                                 
Technicalities of VULA products 

Figure 4-5 

Double-tagged Ethernet frame structure 

Source: Wikipedia, WIK 

Both, S and C-tag have their own 3 bit priority field where both, the access seekers and 
the access providers can both specify their own priorities. An example is given in Table 
4-1. As long as there is no contention on the handover port or backhaul link the access 
seekers priorities may be transparently used and transmitted without any interpretation 
by  the  access  provider  (best  practice  VULA).  If  there  is  any  contention  the  access 
seekers bandwidth demand may either compete against all frames transmitted over the 
same  link,  frames  may  be  discarded  according  to  their  DEI  flag  (Figure  4-5)  and 
prioritised according to their classes. But it is not said that all users will set the priorities 
according to the same rules. Therefore this approach could end in unfair treatment and 
discrimination, not necessarily driven by the access provider, but by other competitors o 
n  the  same  backhaul  link  also.  Or  each  access  seeker  has  its  defined  (contended) 
bandwidth  inside  which  the  access  provider  treats  priorities  and  drop  eligibility 
according to the parameters set by the access seeker (rather fair treatment). 

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Technicalities of VULA products 

Table 4-1 

Example of priority use in an Ethernet frame 

Priority

Acronym Description

1

0
(Default)

2

3

4

5

6

7

BK

BE

EE

CA

VI

VO

IC

NC

Background – bulk transfers and other activities that are permitted on the network
but that should not impact the use of the network by other users and applications

Best Effort – for default use by unprioritized applications with fairness only
regulated by the effects of TCP’s dynamic windowing and retransmission strategy

Excellent Effort – or “CEO’s Best Effort”, the best-effort type service that an
information services organization would deliver to its most important customers

Critical Applications – characterized by having a guaranteed minimum bandwidth
as their primary QoS requirement and subject of some admission control to ensure
that one system or application does not consume bandwidth at the expense of
others. The admission control mechanism can range from pre-planning of
the
network requirement at one extreme to bandwidth reservation per flow at the time
the flow is started at the other.

Video, < 100 ms delay – or other applications with low latency as the primary QoS
requirement

Voice, < 10 ms delay and maximum jitter – (one way transmission through the LAN
infrastructure on a campus)

Internetwork Control – in large networks of several domains to distinguish the
traffic for network control from the traffic of the immediate domain

Network Control – characterized by a guaranteed delivery requirement to support
configuration and maintenance of the network infrastructure

Source: IEEE 802.1Q, 2005 

The best practice VULA features discussed in this section would not be required in an 
LLU environment, because the access seeker could control these characteristics itself 
according  to  its  requirements  and  customers’ needs.  The  LLU  provider  could  take  the 
decision  not  to  meet  these  characteristics,  but  that  would  be  at  his  own  business  risk 
and  might  affect  the  quality  of  service  it  provides  and  ultimately  its  customers’ 
satisfaction.  As  control  of  these  features  passes  to  the  access  provider  in  the  case  of 
virtual  unbundling,  it  is  necessary  to  set  certain  parameters  to  ensure  that  the  access 
seeker has the same potential to control its quality of service – subject to the limitations 
of the underlying infrastructure. 

In  general  the  layer  2  (Ethernet)  protocol  and  its  transparency  characteristics  are 
widely accepted as the handover and transmission protocol. It is mature and a proven 
protocol  for  transmitting  almost  all  kinds  of  traffic.  Its  position  at  layer  2  of  the  OSI 
protocol stack enables it to guarantee transparent forwarding of any content, if applied 
appropriately.  It  is  the  first  transmission  link-independent  protocol,  thus  guaranteeing 
technology independence. 

Our case studies as well as the feedback in the consultation on the VULA specification 
submitted  in  the  German  market,  suggest  that  a  best  practice  VULA  would  offer  pure 
uncontended  access.  Although  there  may  be  restrictions  concerning  technical 
capabilities of the line and/or restrictions regarding the transmission protocols admitted 

59 

 
 
Technicalities of VULA products 

in  order  to  protect  the  network  and  environment109,  there  is  no  reason  not  to  grant 
access to the full technical capabilities of each access line driven by the DSLAM/MSAN 
in  a  VULA  product.  This  characteristic  would  most  closely  replicate  the  capabilities  of 
physical unbundling – making maximum use of the copper wire’s capacity. We note that 
in the one case where an uncontended product was offered – Denmark – take-up was 
low. However, access seekers generally stated that they would prefer such a product, if 
it  were  functional  and  priced  appropriately.  A  lack  of  contention  in  the  wholesale 
product,  accompanied  by  a  flat-rate  charge,  is  also  a  key  element  in  enabling  full 
flexibility  by  the  access  seeker  over  the  nature  of  the  services  offered  (described  in 
more detail below). It should be noted that a pure uncontended product is most likely to 
be achievable with cabinet and MDF handover.  

Contention could nonetheless occur at the handover interface, if the end-customers of 
the access seeker demand more bandwidth than the interface can support. In order to 
prevent  this  potential  effect,  the  wholesale  provider  should  offer  a  choice  between  1 
and 10 Gbit/s handover interfaces to the access seeker. 

If the handover point is located higher up in the network than the MSAN additional 
threads  for  contention  may  occur  in  the  MSAN  backhaul  link,  which  is  used  in 
common with the wholesale providers retail customers. Being treated the same manner 
as the wholesale providers retail customers does not allow for a product differentiation. 
The EC 2014 market recommendation staff working document states in this regard “The 
technical features of the connection (backhaul connecting the street cabinet and central 
office  and  capacity  dimension  in  particular)  should  only  be  limited  by  the  inherent 
capacities of the access technologies deployed and support LLU like services”110.  

Backhauling  MSAN  handover  points  through  additional  fibre  links  up  to  the  MDF  or 
BNG  level  would  overcome  the  backhaul  contention  problem,  but  increases  cost  and 
requires the wholesale seeker to provide handover interfaces for all connected MSANs. 
The  Austrian  approach  of  offering  a  combination  of  guaranteed  backhaul  capacity 
and a peak capacity which must be shared between all users in a fair and best effort 
manner within the common backhaul link is a good compromise and allows the access 
seekers  to  dimension  the  backhaul  capacity  according  to  its  customer  mix  and  usage 
behaviour.  In  this  scenario  access  seekers  should  have  the  option  for  all  backhaul 
capacity to be either guaranteed capacity quality (ie uncontended) or all can be of the 
best  effort  type.  Also  a mix  is  definable,  as  already  describes  above Table  4-1. There 
are, at least in theory, options for an access provider to discriminate the frames of their 
access seekers by improper translating the C-tag priorities into S-tag priorities or setting 
the DEI to 1 for any frame. So there should be control tools monitoring and indicating 
unfair behavior.  

109   Transmission  power  and  frequency  ranges  have  to  be  chosen  in  a  manner  that  the  transmission 

signals do not interfere with other transmissions along the lines or as radio signals. 

110   SWD(2014) 298 of 9.10.2014, p. 43 

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Technicalities of VULA products 

All quality (guaranteed and best effort, and any additional classes) should be associated 
with  appropriate  service  levels  regarding  delay,  jitter  and  packet  loss.  Performance 
measures  KPIs  should  be  defined  and  if  not  met  for  at  least  90%  of  time  per  month 
quality  improvements  should  be  required,  have  to  be  taken,  including  upgrade  of  the 
backhaul capacity. The backhaul capacity of the best effort share should be monitored 
and  if  it  reaches  100%  traffic  load  more  than  10%  of  the  time  in  the  busy  hour  for  at 
least 5 days per month111, the backhaul capacity should be increased. Any monitoring 
results  should  be  shared  with  the  access  seekers  on  a  monthly  basis.  Backhaul 
capacity  increase  should  be  completed  within  two  months112.  If  the  targets  cannot  be 
met a flat fee compensation shall be paid per backhaul connection, valued at half of the 
monthly fee for all access lines affected.  

The use of VLAN tagging is state of the art in almost all VULA products reviewed. They 
are  also  recommended  by  the  German  NGA-Forum,  thus  accepted  by  all  attending 
stakeholders  in  Germany.  This  is  best  practice  VULA.  There  should  be  at  least  4 
VLANs  per  end  customer  (as  in  Austria),  which  for  example  could  be  used  to 
distinguish  different  traffic  types  like  voice,  data  and  video113.  Planning  8  VLAN  per 
end-customer  adds  a  reserve  for  future  product  differentiation.  In  contrast,  in  the 
LLU  case  the  access  seeker  itself  determines  VLAN-tagging,  the  tag’s  structure  and 
necessary interactions with his end customer (or the CPE), and would not require any 
coordination with an intermediate provider of active wholesale access. 

The maximum “normal” standardized  Ethernet  MTU (Message Transfer Unit) size is 
1,500 Bytes. This is transparently used by the end-customers114. However, it is widely 
accepted (and reflected in the interviews conducted for this study) that from a wholesale 
carrier’s point of view this size is not sufficient. Product differentiation requires the user 
MTU  to  be  framed  by  additional  bytes.  These  can  be  transported  by  so  called  Jumbo 
Frames.  These  frames  are  defined  up  to  9000  Bytes  per  frame,  used  in  order  to 
improve  transmission  behavior  when  transmitting  large  files  (less  protocol  overhead. 
For carrier grade Ethernet baby jumbo frames are common, with a typical size of 1,600 
Bytes115.  From a product definition point of view these additional frames should be as 
large  as  possible  without  significantly  constraining  the  equipment  suppliers  choice116 

111   According to the EC DG CONNECT in its decision regarding DE/2016/1934, C(2016) 8366 final of 5. 
December 2016, p8 BNetzA has set out a rule for monitoring backhaul links between an MSAN and a 
BNG  where  above  5  or  more  days  the  peak  traffic  exceeds  80%  capacity  utilization  a  capacity 
increase of that link shall be triggered.  

112   A backhaul capacity increase can not only be realised by for example multiplying a 1 Gbit/s Interface 
or increasing the capacity to 10G or multiples, but also by splitting DSLAMs/MSANs in order to offload 
traffic and share it by several systems. 

113   See also BEREC, Common Position on Layer 2 Wholesale Access Products, BoR (16) 162 
114   The  end-customers  can  use  this  transport  volume  per  frame  without  any  restrictions  for  the  higher 
level  messages.  So  no  volumes  will  be  taken  away  for  additional  layer  2  protocol  frames.  If  such 
additional  frames  are  required  in  the  context  of  wholesale  services,  where  layer  2  frames  are 
encapsulated  by  additional  layer  2  frames,  this  has  to  be  performed  outside  the  end-customer  data 
frame.  

115   http://www.ceragon.com/files/Ceragon%20-%20Jumbo%20Frames%20-%20Technical%20Brief.pdf 
116   The  equipment  providers  (of  the  carrier  grade  equipment  a  telco  typically  uses  had  to  support  this 

frame size above the normal Ethernet standard.  

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for  the  access  providers.  1580  Bytes  is  best  practice  VULA  today.  In  Denmark  even 
1600 Bytes are defined. This size is also requested by the German ANO 1&1.117 The 
minimum MTU size allows a minimum of additional Layer 2 protocol definition freedom 
for  the  access  seeker,  be  it  for  business  or  residential  customer  solutions.  Part  of  the 
difference  of  80  Bytes  (above  the  1500  baseline  required  for  the  customer)  is  already 
consumed by MPLS and VLAN-tagging. In an LLU case the access seeker would itself 
determine the size of the MTU applied, and would not require any coordination with a 
provider of active wholesale access. 

There should be at least one dedicated logical connection per end customer between 
the handover interface and the end customer CPE the access seeker can address. Any 
of  these  logical  connections  shall  be  described  in  a  qualitative  manner,  at  least  by  an 
availability  per  year118.  There  should  be  a  unique  customer  ID  for  each  end-
customer  which  can  be  used  in  common  between  the  access  provider  and  access 
seeker  to  name  the  end-customers119.  In  an  LLU  case  the  access  seeker  by  its  own 
determines  over  logical  active  connections  and  his  customer  IDs,  not  requiring  any 
coordination with a provider of active wholesale access. 

A topic often debated is whether  the Multicast frame replication should be supported 
in  the  wholesale  providers  network  or  not.  According  to  the  EC  2014  market 
recommendation  and  its  staff  working  document120  (“multicast  where  appropriate”) 
multicast should be supported at appropriate locations or under appropriate conditions. 
Multicast  is  a  tool  used  for  efficiently  transmitting  IP-TV  signals.  It  sends  TV-channels 
over  a  branch  of  the  downstream  network  when  actually  requested  by  the  end-
customers on that branch. It will become thinner and thinner the finer the network tree 
from  the  IP-TV  server  down  to  the  end-customers  is  branched  out  and  the  lower  the 
number  of  IP-TV  end  customers  and  the  number  of  requested  channels  become.  For 
NGA networks which continue to rely on copper such as FTTC only a limited set of TV-
channels can be sent over the bandwidth constrained copper pair121. Each TV-channel 
is  only  sent  once  in  a  network  branch  –  and  it  is  only  sent,  if  requested  from  an  end-
customer in that branch. Multicast (as opposed to broadcast) transmits all TV-channels 
to TV subscribers only.  

In the context of a VULA product, the location of the handover point and the number of 
wholesale end-customers of an access seeker offering an IP-TV service are relevant to 
determining whether a multicast frame replication function supported by the wholesale 

117   1&1 resonse to the BMVI VULA consultation, April 2016 
118   Connections to customers have availability of x% per year, packet loss of y%, delay < xy ms,  jitter < r 

ms, … 

119   DT  realises  this  by  assigning  one  S-VLAN-ID  to  each  of  the  access  seeker’s  end-customers  –  per 
handover  point.  So  this  is  complex  and  may  result  in  errors  because  the  VLAN-ID  only  is  unique  in 
relation to the handover point. From a network documentation pint of view concatenating the customer 
–ID with a hardware handover point soon causes  documentation inconsistencies. 

120   SWD(2014) 298 of 9.10.2014, p.43 
121   VDSL networks typically limit the number of TV-channels at approximately 4 parallel channels (actual 

linear viewing, recording, children…).  

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provider results in a significant reduction of bandwidth for IP-TV handed over and thus 
in  a  significant  reduction  of  cost.  Multicast  frame  replication  is  an  additional  feature  to 
avoid  parallel  transmission  of  a  given  IP-channel  to  different  end-users.  If  multicast 
frame replication is not supported by the wholesale provider, the wholesale-seeker must 
provide  the  IP-TV  channel  requests  of  all  its  IP-TV  end-customers  in  parallel  over  the 
handover interface. It cannot benefit from synergies when several of its end-customers 
watch  the  same  channels.  These  channels  will  be  sent  multiple  times  in  parallel  over 
the  same  handover  interfaces.  This  increases  its  capacity  requirement,  but  also 
increases the backhaul capacity demand down to the MSAN, if the handover point is at 
a higher network level. At the MSAN level the number of an access seeker’s IP-TV end-
customers  is  limited.  Hence  the  bandwidth  saving  effect  for  the  handover  interface  is 
limited  and  typically  will  not  have  any  effect  because  of  the  fixed  interface  capacity 
steps (1 Gbit/s, 100 Gbit/s). This becomes different at an MDF level aggregating many 
MSAN and even more at the BNG level. There, significant savings can be expected122. 
Even  more  savings  can  be  achieved  when  applying  the  IGMPv3/ICMPv6123  protocol 
across  network  borders.  One  can  also  assume  that  DT  is  using  Multicast  frame 
replication with IGMP/ICMP at the BNG level. So it would be discriminatory not to offer 
multicast frame replication at the BNG level if a VULA-like handover is obliged there124. 
From  the  market  best  practice  VULA  observation  we  conclude  that  multicast  frame 
replication  is  not  required  at  a  cabinet  level,  but  should  be  offered  at  any  level 
above.  

In the context of one homogenous VULA product handed over at several location levels 
it  makes  sense  to  require  multicast  frame  replication  at  all  handover  levels, 
because  even  at  the  MSAN  level  it  reduces  handover  capacity.  In  an  LLU  case,  the 
access seeker would have the freedom to take its own decisions concerning multicast 
replication and the locations where it should apply, and would benefit from the resulting 
improvement of bandwidth and cost efficiency. If multicast replication is not available at 
higher  level  handover  points  we  expect  a  significant  economic  discrimination  to  the 
disadvantage of access seekers because the wholesale provider may request to be fully 
compensated  for  the  unnecessary  increased  capacity  provided  at  the  backhaul  and 
handover  point,  which  would  be  needed  in  the  absence  of  multicast  support.  This 
inefficiency  would  also  affect  the  access  seeker’s  network,  requiring  it  to  invest  in 
unnecessary  additional  handover  point  capacity  and  backhauling.  In  contrast,  the 
access provider would be able to optimize its multicast streams in order to maximize its 
own efficiency. 

122   Each TV-channel is only sent once.  
123   Internet  Group  Management  Protocol  version  3/  Internet  Control  Message  Protocol  for  IP  version  6 
allow  to  include  only  those  TV-channels  requested  by  the  end  users  into  a  multicast  tree  down  a 
network to these end-users. 

124   DT  argues  that  any  access  seeker  could  deploy  its  owm  multicast  frame  replication  at  its  own 
equipment at the BNG level. This is true, but inefficient and discriminating. The handover port capacity 
and  the  Backhaul  capacity  to  the  MSAN  would  increase  significantly,  because  each  TV-channel 
viewed  by  an  access  seeker’s  end-customer  has  to  be  transmitted  separately,  being  transmitted  in 
parallel as many times as requested. In this case there is also no synergy by IGMP,  

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4.3  Access seeker’s control 

Free choice of the end-customer CPE is best practice for VULA. A typical approach 
as seen in the country case studies is to include approved CPEs admitted on a whitelist. 
Access seekers can expand that list by nominating their own CPE for approval by the 
wholesale  provider.  In  Germany  the  end  customer  is  free  to  choose  its  CPE  (Free 
Router Choice Law (FTEG § 11 (3), 2016) and the wholesale provider just provides the 
end-modem. So the end-customer can buy a CPE (router) in a shop or take/buy it from 
its service provider. 

Another  important  best  practice  characteristic  for  VULA  is  control  by  the  access-
seeker  of  the  whole  technical  capacity  of  the  access  line.  In  this  scenario, 
bandwidth control and traffic prioritisation125 would be performed by the access seeker 
alone (see section 4.2, Figure 4-5 and Table 4-1). The wholesale access provider would 
not need to offer bandwidth classes.  This would be the ideal solution and would come 
closest126  to  allowing  access  seekers  similar  flexibility  as  for  physical  unbundling  to 
tailor products in both quality and price. This type of VULA offer is only available today 
in  Denmark,  to  our  knowledge.  A  second  best  solution,  but  remaining  in  a  me  too 
product definition sphere without the capability to differentiate their products, could be to 
offer at least 8 priority classes to all access seekers and used by the incumbent also, in 
order to reflect the priority levels of  Table 4-1.  

If  there  are  restricted  capacities  offered  on  the  backhaul  link  as  described  above,  the 
access seeker should be able to control the quality parameters set for the backhaul link 
through an ordering process127. For short term tests or improvements in the context of 
direct  access  network  control  the  capacity  parameters  should  be  controlled  by  the 
access seekers by a rather short term order and response process128 lasting no longer 
than a few hours (2 - 4 hours) at least for test cases. Control over service classes129 
could also be implemented in this way.  

Ideally, access seekers should be able to operate or control their end-customer ports 
in an MSAN130 as virtually separated MSAN ports in a multi-tenant manner, so would 
be  able  to  control  all  line  code  parameters  and  the  signal  to  noise  ratio  (SNR)131  by 

125   For bandwidth control and traffic prioritisation see section 4.1 
126   It would still not allow as much flexibility as physical unbundling, as the choice of VDSL equipment lies 

with the access provider 

127   See below at the end of this section. 
128   In many cases the access seeker cannot directly manipulate the line transmission parameters within 
the access providers network and immediately observe the result, as it could do in his own systems 
(LLU case). Changing parameters then requires an interaction over the order change interface. Such 
interaction  should  not  last  days,  but  rather  be  provided  within  in  short  term  (within  a  few  hours 
longest).  

129   Service  class  describes  a  group  of  Services  (ie  voice  calls  and  conferences)  with  the  same  quality 

requirements.  

130   Ports  in  an  MSAN  directed  to  the  end-customer,  to  which  the  copper  (sub-)loop  ending  at  the  end-

customer premise is connected. 

131   Line codes describe how the information to be transmitted is translated into electrical signals and to 
what  extent  failure  correction  methods  are  applied.  So  they  impact  transmission  quality  and  reach. 

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Technicalities of VULA products 

themselves as demanded in the German market consultation responses of competitive 
operators  and  their  associations.  This  would  require  a  multi-tenancy  feature132  in  the 
MSANs and their element manager systems133. While this is theoretically feasible and 
had  been  proposed  by  Alcatel-Lucent  approximately  10  years  ago,  there  was  no 
demand  for  it,  thus  such  system  capabilities  are  not  market  available  today. 
Nevertheless  best  practice  for  VULA  is  either  to  control  the  SNR,  e.g.  by  a  short 
response order process or by making use of auto-optimising line parameter tools of 
the MSAN134.   

BEREC requires that layer 2 wholesale access products should enable access seekers 
to apply any security measures that they would like to supply at layer 3 and above135.  

It  is  best  practice  for  VULA  to  offer  fault  management  capabilities  over  electronic 
interfaces. This includes trouble ticket exchange, at least per e-mail, access to a real-
time  line  state  information  allowing  for  an  access  line  diagnosis  and  monthly  line 
state reports136. If the line state parameters (i.e. the Bit Error Ratio, BER) fall below an 
agreed  threshold,  the  line  should  be  identified  as  having  a  fault.  A  KPI  monitoring 
system137 should be applied. As a minimum Mean Time to Provision (MTP) and Mean 
Time to Repair (MTR) service levels should be defined and monitored, and if the targets 
are  not  met  damage  compensations  shall  be  paid  in  an  automatic  manner. 

SNR  describes  the  sensitivity  the  signals  can  be  affected  by  noise  and  also  has  an  impact  on  the 
transmission  quality  regarding  bandwidth  and  reach.  G.INP  is  a  standardized  Impulse  Noise 
Protection procedure typically available in Vectoring MSANs, which can be switched on on demand. It 
allows  to  increase  transmission  bandwidth  in  electromagnetic  noisy  environments.  This  feature  ie 
should be accessible to the access seekers. 

132   Multi-tenancy describes the capability of virtually dividing a system into slices each offering the tenant 
(user) a look and feel of a separate system with all its capabilities. This system is a virtually separated 
system, not a physical one. Regarding an MSAN it looks as if each access seeker could operate its 
own MSAN.  

133   Telecommunication systems of the same type are typically supervised, parameterized and monitored 
by  a  management  system  which  is  dedicated  to  these  type  of  network  elements  –  the  network 
element  manager.  This  system  is  familiar  with  the  specific  capabilities  of  the  network  elements  and 
are  also  used  for  failure  analysis.  Above  these  element  managers  are  wider  scale  monitoring  and 
reporting  systems,  sometimes  called  umbrella  manager  systems.  Here  failure  messages  of  the 
different  network  elements  come  together,  are  analysed  and  filtered  by  redundant  messages  and 
typically presented in a graphical manner in order to ease network monitoring. In an LLU environment 
each network operator would have access to all element managers involved in the value chain. With 
active wholesale access some of these are in the access provider’s sphere. 

134   Auto-optimizing is a feature MSANS offer to apply the different transmission parameters (line coding, 
error correction) in a manner which optimises transmission capacity It should be possible to over-ride 
auto-optimizing when the access seeker wants to deviate in the product definition from the standard, 
by  either  improving  the  line  stability  and  error  rate  by  increasing  the  SNR  or  by  driving  the  line  at  a 
higher bandwidth and risk for faults through a reduced SNR. 

135   BEREC  Common  position  on  layer  2  wholesale  access  products,  BOR  (16)  162,  p.  10.  Security 
measures may block different traffic types on behalf of the access seeker. Thus protocol transparency 
is determined by the access seeker because of security reasons. 

136  The  detailed  elements  of  such  line  state  information  and  statistics  should  be  defined  by  a  market 
consultation  process.  The  system  applied  in  Denmark  and  its  characteristics  is  described  here: 
https://networks.nokia.com/products/motive-network-analyzer. In the LLU case the access seeker can 
deploy all analysis tools available for improving its failure analysis process in case of active wholesale 
access  it  relies  on  the  tools  offered  by  the  access  provider.  Thus  a  common  set  of  parameters,  as 
wide as possible, is the optimum for differentiation in product quality. 

137   Parameters  should  be  a  result  of  a  market  consultation  process  and  depend  on  the  parameters 

defined in the line state reporting. 

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Prerequisites for KPI monitoring are clear fault definitions, when a line is considered to 
be down and when it is available. 

Control of the operational and business support processes138 is part of the access 
seeker’s  control  part  of  the  recommended  requirements  for  a  VULA  in  the  EC  market 
recommendations staff working document139. The OSS interaction is already addressed 
in the paragraph before. The BSS interaction deals with the order, provisioning,  change 
and  termination  of  the  wholesale  products.  One  electronic  process  interface  dealing 
with all these aspects is best practice at least for the provisioning of the VULA services. 
Ideally it should be one uniform interface which is used by all operators, preventing the 
complexity  for  the  wholesale  seekers  to  use  different  interfaces  and  systems  when 
ordering  at  different  wholesale  providers.  The  German  NGA-Forum  has  at  least  for 
Germany  defined  best  practice  for  VULA  and  L2  bitstream  access  with  its  interface 
S/PRI 4.0140.  Also for the provisioning services KPIs should be defined, monitored and 
automatic compensations may have to be paid if the targets have not been met in order 
to be in line with best practice.  

4.4  Migration 

Migration  can  be  distinguished  between  natural,  bulk  and  enforced  migration.  In  the 
natural  case,  end-customers  are  migrated  on  their  demand  from  an  old  to  a  new 
product, typically combined with an increase of the bandwidth provided141. New product 
announcements supported by major marketing efforts often result in a large number of 
natural  migrations  called  bulk  migration.  For  these,  as  with  LLU  and  other  wholesale 
products,  it  is  best  practice  to  put  in  place  a  forecast  process  for  VULA  demand,  in 
order  to  guarantee  appropriate  provisioning  times,  enabling  the  wholesale  provider  to 
schedule capacity in advance. Forced migration is typically caused by switching off old 
services,  forcing  access  seekers  and  their  end-customers  to  migrate  onto  a  new 
platform.  In  this  case,  migration  rules  are  of  special  interest  because  this  migration  is 
not  caused  by  an  access  seeker  or  end-customer  decision,  but  by  the  wholesale 
provider.  Best  practice  for  this  case  can  be  taken  from  Austria:  Forced  migration 
requires  

•  early announcement,  

•  common planning processes in advance,  

138   Implemented  by  OSS  (operational  support  systems)  and  BSS  (business  support  systems)  in  the 
operators’  IT-platforms.  These  systems  support  the  order,  change  and  termination  processes,  the 
billing  process  and  the  customer  administration  (BSS)  and  the  network  monitoring,  trouble  ticketing, 
fault analysis and statistics, umbrella management and element managing systems (OSS). The latter 
also  include  workforce  management  for  the  field  service.  In  a  pure  LLU  environment  a  significantly 
less  intensity  of  interaction  just  for  dealing  with  the  layer  0  unbundled  copper  line  aspects  would  be 
required.  The  rest  of  the  processes  (for  layer  1  and  layer  2  control)  would  be  part  of  the  access 
seekers systems without any interaction on the higher communication layers.  

139   SWD(2014) 298 of 9.10.2014, p. 44 
140   See BNetzA’s homepage for more details on the whole NGA-Forum process and its standards 
141   For example: A end-customer wants to migrate form an ADSL based access line to a VDSL2 based 

access line (including the change from LLU to FTTC and SLU). 

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•  early definition of CPE and/or modem characteristics and sufficient availability,  

• 

• 

the  option  for  the  end-customers  to  migrate  to  a  new  product  within  the 
migration process, and  

the option to remain on a comparable product as before without any additional 
cost.  

Except in the case of product upgrades the access seeker should not be responsible for 
costs due to migration. Furthermore, if infrastructure or systems are stranded because 
of  the  enforced  migration  these  frustrated  (stranded)  investments  should  be 
compensated  by  the  wholesale  provider,  valued  at  the  book-values  at  the  day  of  the 
bulk migration. 

Best  practice  at  least  for  VULA  also  entails  operating  forced  migration  through  an 
automatic  provision  process.  Such  migration  should  be  supervised  through  a  KPI 
monitoring process which assesses as a minimum the re-establishment of the services 
within  a  time  frame  of  (for  example)  1h  and  the  number  of  customer  complaints  per 
system  migrated  because  of  migration  faults  being  below  (for  example)  2%.  This 
monitoring should include automatic compensation per line exceeding the thresholds. 

Forced  migration  has  already  occurred  in  two  of  the  countries  which  we  surveyed  – 
Denmark and Austria. In Germany, such forced migration may occur when an operator 
is pushed out of a cabinet due to the conditions of the Vectoring I and II decisions142. 
This  affects  only  a  relatively  small  number  of  lines  however.  Forced  migration  is  also 
occurring for the VDSL LLU access solutions offered by alternative operators collocated 
in  the  MDFs  (Vectoring  II).  Although  the  existing  ADSL2  access  lines  are  allowed  to 
continue operation (< 2.2 MHz) ), implementation of vectoring implies that VDSL at the 
MDF site must be switched of and migrated to VULA.  

142   Vectoring one is the only decision relevant for state aid (see section 5.2). In state aid areas there is no 
operator  already  having  deployed  FTTC  with  VDSL,  otherwise  state  aid  could  not  be  granted.  So 
forced migration has no relevance for the cases under consideration in this study. 

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4.5  Price 

The  2013  EC  Recommendation  on  Consistent  Non-discrimination  Obligations  and 
Costing  methodologies143  recommends  that  charges  for  next  generation  wholesale 
access  should  not  be  cost-oriented,  in  circumstances  where  there  are  (i)  sufficient 
constraints  from  infrastructure-based  competitors  such  as cable  and/or  competition  on 
the  basis  of  local  loop  unbundling;  and  (ii)  an  effective  economic  replicability  (margin 
squeeze) test. 

However,  we  note  that  there  are  a  number  of  factors  which  may  suggest  that  an 
assessment  of  costs  should  be  undertaken  to  to  set  or  validate  the  proposed 
charges for VULA, at least for deployments in areas which have received state aid. 

•  Competitive constraints from cable or other infrastructure-based competition are 
unlikely to apply in areas which have been deemed to warrant state aid for the 
deployment of FTTC VDSL 

•  LLU  competition  may  not  even  be  present  in  the  affected  (mainly  rural) 

exchanges.  

• 

If  present,  any  competitive  constraints  from  physical  unbundling  are  likely  to 
decline  as  LLU  itself  continues  on  a  path  of  decline  as  can  be  seen  in  the 
German  market.  Moreover,  the  ‘step-change’  in  quality  required  to  justify  state 
aid itself implies that LLU would be (if at all) an imperfect substitute  

It  could  be  argued  that  if  sufficient  constraints  exist  on  the  pricing  of  VULA,  in 
commercially viable areas, and there is a requirement for the operator in state aid areas 
to  apply  the  same  VULA  price  in  state  aid  zones  as  is  offered  in  other  regions,  this 
should  ensure  that  wholesale  charges  are  set  at  an  appropriate  level  to  enable 
competition  as  well  as  to  support  investment.  However,  the  declining  constraining 
influence  of  LLU  on  VULA  applies  beyond  state  aid  areas.  For  example,  although 
further  analysis  is  needed,  the  case  studies  in  chapter  3  might  suggest144  that  in 
practice in the absence of cost-orientation and obligations to offer a flat-rate bandwidth 
unconstrained  VULA,  access  providers  may  offer  pricing  structures  for  FTTC  VDSL 
VULA  which  apply  a  significant  premium  for  FTTC  speeds  above  ADSL  speeds,  and 
which  are  heavily  tiered  with  high  prices  charged  for  higher  bandwidths.  Given 
increasing  take-up  of  FTTC  VDSL  and  the  relative  maturity  of  the  equipment,  this 
pricing structure may no longer be representative of the costs and risks involved. 

143   https://ec.europa.eu/digital-single-market/en/news/commission-recommendation-consistent-non-

discrimination-obligations-and-costing-methodologies 

144   It  is  notable  from  the  case  studies  described  in  section  3  that  an  uncontended  flat-rate  VULA  at  a 
charge  which  does  not  significantly  exceed  LLU  is  available  only  in  Denmark,  where  the  NRA 
recommended  such  a  product  and  applied  an  approach  of  cost-orientation.  In  the  countries  which 
applied  an  approach  of  flexible  pricing  or  retail  minus,  there  are  significant  differences  between  the 
LLU and VULA charge as well as gaps between bandwidth classes.  

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Indeed, in addition to Denmark, charges for FTTC VDSL VULA/local bitstream are now 
set on the basis of costs (or would be set on that basis by the NRA in the absence of 
commercial agreement) in several countries where FTTC is becoming prevalent and/or 
LLU is in decline including Belgium, the Netherlands, Sweden and Italy.145 A transition 
towards  some  kind  of  charge  control  for  FTTC  VULA  is  also  under  consideration  by 
Ofcom in the context of the upcoming WLA market review. 146 

the 

(limited  by 

the  unconstrained  bandwidth 

On the assumption that the case for cost-orientation is met, we recommend that a cost-
oriented  price for a VULA should be calculated in a  bottom-up LRIC manner based 
technical  and  physical 
on 
characteristics)  of  each  access  line.  This  means,  the  SLU  cost  (without  a  passive) 
cabinet  plus  the  cost  of  the  cabinet  hosting  the  MSAN  and  its  infrastructure,  the 
MSAN147, the customer port and the customer sited modem148, and the handover port 
in case of a handover at the cabinet. In case of handover at a higher level the handover 
port  is  taken  out  of  consideration  but  is  replaced  by  the  cost  of  the  backhauling 
infrastructure,  the  aggregation  system  cost  and  cost  for  the  handover  port.  In  case  of 
directs access lines terminated at the MDF location, the outdoor MSAN will be replaced 
by an indoor MSAN and the infrastructure required. Operating cost have to be added, 
also  a  mark-up  for  common  cost.  If  there  are  specific  cost  for  the  OSS  and  BSS 
interfaces and if there are dedicated wholesale IT-systems a proportionate share for this 
type of wholesale business is also justified to be added.  

The  cost  for  the  VULA  at  higher  than  the  MSAN-level  should  be  calculated  for  the 
uncontended  version  at  a  fixed  and  bandwidth  independent  price,  since  the  VULA  is 
uncontended  and  has  a  fixed  capacity  along  the  whole  transmission  link.  The 
contended versions should reflect a cost oriented share of the uncontended cost, 
because the backhaul capacity is lower than in the unconteded case. The bottom line 
of  the  VULA  shall  be  above  the  SLU  price  (if  the  SLU  price  is  a  component  of  the 
VULA price), because it includes in addition the MSAN and the customer port cost as 
well  as  some  handover  cost,  and  backhauling  for  a  higher  level  when  appropriate.  In 
case  of  a  forced  migration  best  VULA  practice  for  pricing  is  the  SLU  price  for  those 
access  lines  which  will  not  be  upgraded  in  bandwidth  but  remain  on  a  comparable 
service as before (see section 4.4).  

Multicast is a feature any operator could have provided over LLU. Thus, except for the 
additional  cost  for  capacity  in  an  contended  VULA  calculation  for  backhaul  and 
handover port, there should not be any additional charge.  

145   Godlovitch, Kroon, Lucidi, Siliò, Nett, Neu, Stumpf: Regulatory approaches to risky bottleneck assets: 

International case studies, Ofcom, Bad Honnef, February 2016 

146   See  paragraph  4.55  Ofcom  2016  Digital  Communications  Review 
https://www.ofcom.org.uk/__data/assets/pdf_file/0016/50416/dcr-statement.pdf  

initial  conclusions 

147   An FTTC VULA has to be provided  because of the deployment of Vectoring. All  port  cards of today 
are Vectoring enabled. If Vectoring is applied each MSAN includes a dedicated Vectoring processor 
card performing the inter port failure correction (see section 5.1.1). This card has to be included in the 
cost calculations. 

148   If not provided by the access seeker 

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5  VULA in Germany 

In this chapter, we discuss the NGA network architecture of the incumbent in Germany, 
and describe the VULA products proposed by the incumbent and other operators. 

•  Section  5.1  describes  the  characteristic  of  VDSL  as  deployed  in  the  German 
market  and  the  BNG  Network  architecture  and  its  characteristics  regarding 
wholesale access in Germany. 

•  Section  5.2.  describes  the  regulatory  environment  for  virtual  unbundled access 

in Germany 

•  Section  5.3  details  the  cabinet  VULA  products  in  Germany,  especially  those 
submitted  by  the  operators  DT,  DNS:NET  and  NetCologne  in  the  state  aid 
context  and  compare  these  to  the  best  practice  VULA  described  in  section  4. 
This  section  also  includes  a  short  discussion  on  the  VULA  products  which  are 
not relevant in the case of state aid.  

•  Section 5.4 compares to which extent the other product submitted by DT in the 
state  aid  VULA  context,  the  L2  bitstream  product  with  handover  at  the  BNG 
level, is in line with the VULA best practice  

5.1  Relevant Network architecture of the incumbent in Germany 

5.1.1  FTTC and FTTC Vectoring 

A core constraint of copper-based broadband is that the bandwidth that a pure copper 
local loop can transmit reduces as the length of the access line increases For example, 
ASDL2  with  a  DSLAM  in  the  MDF  location  can  support  up  to  16  Mbit/s  downstream 
over  a  shorter  line  length  of  some  100m  and  up  to  10  Mbit/s  up  to  2,000m,  but  will 
support  only  0,6  Mbit/s  at  a  line  length  of  5,000m.  Beyond  that  length,  it  may  not  be 
possible  to  provide  broadband  speeds  at  all.  As  copper  line  lengths  in  Germany  can 
reach  up  to  approximately  7km,  this  means  there  are  some  locations  –  especially  in 
more  remote  areas  –  which  cannot  receive  broadband  via  the  existing  fixed  copper 
network.  

70 

 
Figure 5-1 

xDSL bandwidth over line length 

Technicalities of VULA products 

Source: WIK VDSL conference 2007 

The  bandwidth  can  be  increased  by  shortening  the  copper  line  length,  shifting  the 
electronic  line  aggregating  DSLAMs  into  the  cabinets  and  connecting  them  by  line 
length  independent  fibre  links  to  the  MDF  locations  (called  Fibre  to  the  Curb/Cabinet, 
FTTC).  VDSL2  is  a  transmission  methodology  that  can  achieve  significantly  higher 
bandwidths than ADSL2, but only over shorter line lengths. This makes VDSL2 ideal to 
be installed in the street cabinet and  connected to the copper subloop. The migration 
from all copper ADSL2 to FTTC/VDSL is shown in Figure 5-1. With VDSL2, bandwidth 
may reach up to 100 Mbit/s downstream at short line lengths, although at approximately 
1,2  km,  its  performance  dips  below  ADSL2.  With  the  average  subloop  length  in 
Germany  being  300m149,  there  is  significant  potential  to  increase  bandwidths  through 
use  of  FTTC/VDSL.  However,  it  would  still  not be  viable  in  all  cases  as  the  maximum 
subloop length in Germany is around 2km.  

149   A. Mertz, M. Pollakowski, xDSL & Access Networks, Prentice Hall, 2000, S. 48f 

71 

 
 
 
 
                                                 
Technicalities of VULA products 

Figure 5-2 

Migration from pure copper access lines to FTTC 

Source: WIK 

Because  fibre  can  carry  high  bandwidths  over  a  considerably  longer  distance  than 
copper,  the  link  from  the  street  cabinet  can  be  extended  beyond  current  copper  MDF 
sites, enabling the Ethernet aggregation switches to be moved to a higher network level 
at the edge of the IP core network. This is indicated in Figure 5-1.  

Figure  5-3  shows  the  architecture  resulting  from  DT’s  access  network  migration.  The 
new  generation  of  DSLAM  is  called  MSAN150.  Under  DT’s  plans,  there  would  not  be 
any  intermediate  access  network  aggregation  on  layer  2  (Ethernet)  at  the  MDF 
locations,  except  those  hosting  a BNG  (see  Section  5.1.2).  The  MDF  locations, which 
host so called ‘A0’ access lines, also host MSANs. The A0 lines are short copper pairs 
directly  connecting  end-customers  to  the  MDF  without  any  intermediate  cabinet.  Such 
lines are also aggregated by an MSAN, now located in the MDF.  

150   The MSAN allows to support different DSL transmission technologies and aggregates still existing old 

analogue telephone lines also, converting the voice signals into Voice over IP (VoIP). 

72 

 
 
 
 
                                                 
Figure 5-3 

DT’s FTTC access network architecture 

Technicalities of VULA products 

Source: WIK 

One  challenge  with  VDSL  that  limits  its  performance  is  crosstalk.  Crosstalk  is  the 
electromagnetic interference one copper pair can induce in the neighbouring pairs, thus 
disturbing  the  original  signals  being  transmitted.  Cross-talk  results  in  a  loss  of 
bandwidth  and  reach,  the  more  end-customers  are  connected  to  this  line  signal 
protocol. 

Vectoring  is  a  failure  correction  methodology  which  uses  knowledge  of  the  signals 
transmitted  over  any  of  the  copper  pairs  to  estimate  the  crosstalk  for  each  affected 
copper  line.  It  aims  to  counteract  the  signaling  failures  to  achieve  the  originally 
transmitted undisturbed signal.  

73 

 
 
 
 
Technicalities of VULA products 

Figure 5-4 

Vectoring for crosstalk elimination 

Source: WIK 

Vectoring thus increases the bandwidth per copper pair and makes the bandwidth more 
equal within all pairs, lifting it close to the maximum possible for a given line length. The 
maximum  bandwidth  depicted  by  the  top  of  the  orange  bar  in  Figure  5-5  shows  the 
performance  VDSL2  could  achieve  on  a  single  line  without  any  interference  from 
neighbouring  signals  as  would  be  expected  in  a  copper  cable151  with  24  pairs, 
transmitted  over  a  distance  of  500m.  The  grey  columns  show  the  resulting  effective 
bandwidth of an unvectored VDSL2 transmission over 24 copper pairs in parallel. They 
are  significantly  lower  than  the  maximum  and  vary  significantly  over  the  copper  pairs. 
Vectoring further eliminates the cross talk effects significantly (green columns) and lifts 
the bandwidth per copper pair close to the optimum.  

151   Exactly  spoken:  it  is  the  cable  binder  which  is  of  relevance.  A  cable  might  have  several  binders,  as 

shown in the lower graphic of Figure 5-4. 

74 

 
 
 
 
                                                 
Figure 5-5 

Bandwidth gain with Vectoring 

Technicalities of VULA products 

Source: Frank van der Putten, Alcatel Lucent, answer to BIPT 18.02.2011 

In  addition  to  the  bandwidth  increase  vectoring  also  enables  higher  bandwidth  to  be 
provided over a longer distance (Figure 5-5). This expands the area that can be served 
with broadband technology significantly.  

In summary, the advantages of Vectoring are: 

• 

increases  the  bandwidth  per  end  customer  and  thus  the  minimum  bandwidth 
one can communicate, facilitating achievement of the Digital Agenda for Europe 
Targets  (universal  availability  of  30Mbit/s,  50%  households 
take-up  of 
100Mbit/s) 

•  decreases in asymmetry between Up- and Downstream 

•  allows all the copper access pairs in a cable to be upgraded with high bandwidth 
(broadband  for  all  customers  connected),  which  is  not  achievable  with  VDSL2 
without Vectoring 

•  enables  comparable  bandwidth  for  all  customers  of  comparable  distance  from 

street cabinet 

75 

 
 
 
 
Technicalities of VULA products 

• 

increases  the  reach  per  access  line,  e.g.  for  50  Mbit/s  resulting  in  an  above 
proportion increase of end customer coverage ((cid:2024)(cid:1870)²) 

Figure 5-6 

Vectoring bandwidth increase over copper line length 

Source: Ariel Caner, ECI Telecom, telecomengine.com 1.5.2012 

A significant disadvantage of Vectoring today from a competition perspective is that any 
copper pair which is not  included in the crosstalk correction process of one operator’s 
DSLAM  undermines  the  Vectoring  bandwidth  increase.  Thus  operators  applying 
Vectoring  today  require  exclusive  access  to  copper  pairs.  This    makes  it  technically 
incompatible  with  physical  unbundling  of  the  copper  lines.  Thus  no  VDSL2  DSLAM 
collocation  at  the  cabinet  site  is  possible  without  the  loss  of  the  Vectoring  bandwidth 
gain.  This  might  change  in  future  if  a  Multi-Vendor  Vectoring  could  be  realized, 
coordinating the Vectoring process across DSLAMs of different suppliers and operators. 
A  Multi-Vendor  Vectoring  solution  is  under  development,  but  results  have  not  yet 
materialised152.  

Certain  implementations  of  FTTC/VDSL  vectoring  have  rendered  all  forms  of  physical 
unbundling (both LLU and SLU) unviable153, and has required the migration of existing 
unbundled lines onto VULA. In Germany however, in order not to affect the old copper 
ADSL2  applications  and  competition  through  LLU,  VDSL  Vectoring  only  is  allowed  to 
use the frequency range above 2,2 MHz along the copper lines. 

VDSL operates on a set of frequency ranges, called profiles. The most common use in 
Germany is  the profile 17a, up to 17 MHz. Also in use is the profile 30a (with 30 MHz) 
for  FTTB  in  the  inhouse  terminating  segment.  A  new  upcoming  profile,  which  DT  has 
announced  it  will  implement  soon154,  is  the  profile  35b,  up  to  35  MHz.  It  once  again 

152   It  is  promoted  by  the  Italian  NRA  AGCOM  and  results  had  been  envisaged  at  December  2016,  but 

had not yet been become public. 

153   See Austria 
154   https://www.golem.de/news/anhoerung-telekom-will-bald-super-vectoring-anbieten-1507-114972.html 

76 

 
 
 
 
                                                 
Technicalities of VULA products 

increases  the  bandwidth  over  short  length  access  lines  up  to  800m.  An  interesting 
outcome besides the improvements that can be achieved in the case of Vectoring is the 
bandwidth  increase  that  can  be  achieved  without  Vectoring.  Profile  35b  allows  an 
unvectored bandwidth increase up to a line length of 600m (blue line in Figure 5-7), and 
according to another independent source155 up to 700m without the need for exclusive 
access  rights  to  the  existing  copper  network  infrastructure,  while  Profile  17a  just 
supports  bandwidth  along  the  green  line,  but  requires  exclusivity  in  the  access  to  the 
physical infrastructure for one operator only. 

Figure 5-7 

Bandwidth  of  VDSL2  Profile  35b  with  and  without  Vectoring 
compared to profile 17a with Vectoring  

Source: Huawei 2015 

5.1.2  BNG network architecture 

DT has introduced a new Broadband Network Gateway (BNG) architecture for its All-IP 
Next Generation Network (NGN). The main characteristic is that the Layer 2 (Ethernet) 
aggregation layers are reduced to MSANs (DSLAMs) in cabinets and a subset of MDF 
locations  (those  with  A0  lines),  which  are  directly  connected  to  BNGs  in  899  of  the 
approximately  7,900  MDF  sites.  So  the  BNG  locations  are  a  subset  of  existing  MDF 
sites.  The  BNG  node  locations  are called  IP-PoPs.  The  MDF  locations not  hosting an 
BNG are called MPoPs156. The BNGs aggregate customer traffic like a simple Ethernet 
aggregation  switch,  but  in  addition  check  customer  access  rights  and  permissions  by 
integrating the typical BRAS-function (Broadband Remote Access Server) and form the 
interface to the next level IP-Backbone network and its powerful Label Switch Routers 
(LSR). Thus the BNG also performs the Label Edge Router (LER) function of the higher 
level IP network157.  

155   Kuhlin, Obermann, Bitraten-Boost mit VDSL2 35b, NET 12/2016 
156   IP Point of Presence, Metropolitan Point of Presence – typically the MDF or local exchange sites 
157   I.e. it sets the IP-MPLS (Multiprotocol Label Switching) labels required for fast switching in the IP core 

network 

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Technicalities of VULA products 

While  the  Layer  3  IP-Bitstream  is  routed  to  access  seekers  at  dedicated  LERs  at  the 
core network nodes, Layer 2 (Ethernet) bitstream is provided at any of the BNGs. While 
the  IP-Bitstream  can  be  accessed  at  one  single  LER  interface  in  order  to  get  national 
access,  the  L2-Bitream  must    be  accessed  by  interconnecting  to  each  single  BNG-
node. There is no L2-Bitstream access at those normal MDF level nodes which do not 
host BNGs. 

Figure 5-8 

BNG network architecture in Germany, principle 

Source: WIK  

All  MSAN,  including  those  aggregating  the  A0  lines  in  the  MDF  locations,  are  directly 
connected by a fibre link to a BNG. From MPoP to IP-PoP the link could be aggregated 
on  a  WDM-System  by  using  a  dedicated  wavelength.  These  WDM-Systems  could  be 
connected in a failure tolerant ring system as shown in BNG network architecture Figure 
5-8 right hand side. 

There  is  no  guarantee  that  the  BNG  primarily  collects  the  MSAN  of  a  dedicated  MDF 
access  area  or  that  the  MDF  access  area  can  be  reached  through  a  minimum  set  of 
BNG-nodes.  Therefore,  in  order  to  get  access  to  a  dedicated  local  access  area  an 
access seeker could have to interconnect to several BNG in an IP-PoP.  

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Technicalities of VULA products 

The MSAN backhaul fibre link capacity could be 1 Gbit/s or 10 Gbit/s. In principle also 
several fibre links could be utilised to increase bandwidths. The options depend on the 
type and number of interfaces an MSAN supports. 

5.2  Regulatory  environment  for  virtual  unbundled  access  substituting 

physical unbundling 

Deutsche  Telekom,  the  German  incumbent  operator,  has  been  found  to  have  SMP 
across the national territory in the market for Wholesale Local Access. The market for  
Wholesale  Central  Access  has  some  regional  competitive  exemptions.  It  is  obliged  to 
offer  physical  unbundled  access  to  the  access  network  infrastructure  by  offering 
subloop  unbundling  (SLU  (KVz-TAL),  local  loop  unbundling  (LLU  (HVt-TAL)  and  IP-
Bitstream access at regional (IP-BSA) and central handover locations (IP-BSA Gate). It 
also offers an unregulated Wholesale Internet Access (WIA). DT is also required to offer 
duct access from the MDF site to the cabinet as an ancillary service to SLU – and if no 
capacity is available – dark fibre access in this segment of the network. In response to 
the  introduction  by  DT  of  FTTC  VDSL2  Vectoring  at  street  cabinets,  BNetzA  required 
DT to supply a Virtual Unbundled Access (VULA) at the cabinet level and a wholesale 
L2  Bitstream  access  at  a  location  on  the  MDF  level.  Figure  5-9  summarises  the 
wholesale access products offered by DT. 

In the context of Vectoring, each local access area of an MDF has been subdivided into 
three segments according to the BNetzA access regulation. Firstly a distinction is made 
between  the  ‘near  shore’  and  ‘far  shore’  area  (Figure  5-10).  The  near  shore  area  is 
bounded by a circle of 550m around the MDF location and includes all A0 lines and all 
lines  were  a  street    cabinet  (KVz)  lies  inside  this  circle.  All  other  access  lines  are 
allocated to the far shore area. The far shore area has then been divided into state aid 
areas and areas without state aid.  

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Technicalities of VULA products 

Figure 5-9 

DT’s wholesale access products in markets 3a and b 

Source: DT State aid VULA submission, DG /10/831.1/0, 2016 

Figure 5-10 

Near  shore  and  far  shore  area  in  a  local  access  area  in  DT’s 
network in Germany 

Source: WIK 

80 

 
 
 
 
 
 
 
Technicalities of VULA products 

Far shore area without state aid: 
The  far  shore  area  was  the  first  area  for  which  a  regulatory  decision  concerning 
Vectoring  was  taken  (Vectoring-I  decision,  August  2013).  The  Decision  required  DT 
(and those alternative operators who could successfully compete for exclusive cabinet 
deployment)  to  offer  a  Layer  2  bitstream  access  at  a  location  close  to  the  MDF  or 
equivalent  network  level  to  all  operators.  In  addition,  an  operator  which  had  already 
deployed  VDSL,  but  which  was  excluded  from  SLU  due  to  vectoring  implementation 
was given the right to VULA access at the cabinet level (KVZ-AP I) at reduced cost, with 
the aim of compensating for the stranded cabinet investment. No other operators have 
the  right  to  access  this  cabinet  VULA  access  offer.  Instead,  other  operators    were 
compelled to use an existing L3 IP-Bitstream product at regional level while waiting for 
the L2 bitstream product to be defined and operationalized. This L2 Bitstream product 
has now been defined and has a handover at the BNG level. The handover level of the 
BNG bitstream is similar to that for VULA in the UK (ie offered at a subset of locations). 
However, unlike the UK VULA, which was considered by Ofcom to be a substitute for 
physical unbundling at the MDF site, and was mandated as a remedy under market 3a 
(Wholesale  Local  Access),  BNetzA  has  deemed  that  the  L2  BNG  wholesale  product 
should be considered as a form of bitstream, within the context of market 3b (Wholesale 
Central  Access).  Despite  regulated  in  market  3b  it  was  presumed  to  represent  a 
substitute for physical unbundling. 

Far shore area with state aid: 
As  regards  far  shore  areas  affected  by  state  aid,  the  European  Commission  DG 
Competition  required  that  any  subsidies  for  the  construction  and  operation  of  an 
infrastructure  where  physical  unbundling  was  technically  or  economically  not  feasible 
(for instance due to vectoring technology), should be subject to a VULA obligation. They 
further required the German government158 to notify any such VULA products and await 
approval  before  allowing  the  implementation  of  technological  solutions  which  did  not 
support unbundling with state aid funding. Accordingly, DT, NetCologne and DNS:NET 
submitted  VULA  proposals  to  the  German  ministry  BMVI,  who  forwarded  them  to  the 
Commission. All offer a local VULA handover at the cabinet, DT in addition offered L2-
Bitream  at  the  BNG  and  DNS:NET  offered  additional  wholesale  products  enabling  a 
handover at a BNG level. 

Near Shore area: 
Initially,  the  deployment  of  Vectoring  in  the  near  shore  area  was  not  permitted,  to 
enable  all  operators  to  continue  to  use  VDSL2  on  the  basis  of  LLU.  However,  DT 
applied  to  use  Vectoring  in  these  areas  also,  and  requested    exclusivity  because  the 
Vectoring  characteristics  were  not  compatible  with  physical  unbundling  (Vectoring  II 
procedure). This was granted by BNetzA for DT in almost all near shore areas, on the 
basis that DT committed in advance to deploy broadband access above 50 Mbit/s in all 
areas, except those for which competitors had made comparable commitments. Due to 

158   SA.38438 (2014/N) Germany, C(2015) 4116 final of 15.06.2015 

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Technicalities of VULA products 

the upfront commitments to commercial investments, these areas cannot be considered 
eligible for state aid. For these areas a wholesale access procedure is still ongoing. DT 
has submitted a cabinet VULA (KVz-AP-N) proposal for these areas also.  

KVz-AP summary 
The  KVz-AP  products  differ  in  their  characteristics  (e.g.  line  availability,  provisioning 
times). During the submission process, DT improved its submitted KVz-AP-F product in 
several respects, but it was not yet finally defined because of DG Competition’s ongoing 
approval  procedure.  This  study  concentrates  on  the  specification  submitted  in  the 
context  of  far  shore  state  aid,  but  takes  into  account  VULA  products  proposed  in 
commercially viable areas. 

Table 5-1 

Overview three German cabinet VULA 

Characteristic 

Near shore area 

Far  shore  with  state 
aid 

Far  shore  without 
state aid  

Product name 

KVz-AP-N 

KVz-AP-F 

KVz-AP-I 

Legal procedure 

Vectoring-II 

Vectoring-I plus state 
aid 

Vectoring I 

VULA handover 

cabinet/ MDF (A0) 

cabinet 

cabinet, restricted to a 
pushed-out operator 
only 

L2-Bitstream/ 
handover 

yes/ per BNG  

yes/ per BNG 

yes/ per BNG 

5.3  Cabinet VULA 

In  September  2016,  Germany  notified  to  the  Commission  three  "state  aid-VULA" 
products  from  DT,  DNS:NET  and  NetCologne  on  the  basis  of  the  NGA  Germany 
decision.  In  the  following  sections  we  compare  each  of  the  submitted  VULA  products 
with the best practice VULA approach described in section 4 above159. In the case of 
DT  we  also  highlight  some  differences  between  the  state  aid  VULA  and  that  for  the 
other  far  shore  cases  (KVz-AP-I)  and  that  proposed  for  the  near  shore  cases.  In 
contrast  to  version  1  of  the  report  we  now  compare  the  final  versions  of  the  VULA 
products  in  case  of  state  aid,  which  were  submitted  end  of  July  2017/beginning  of 
August 2017.  

159   If  we  refer  to  best  practice  in  this  section  it  means  best  practice  VULA  unless  explicitly  stated 

differently. 

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5.3.1  Submitted DT product 

The initial VULA product for state aid submitted by DT has been modified over time in 
response  to  comments  received  through  the  market  consultation  undertaken  by 
Germany, from the German NRA BNetzA and the analysis provided by version 1 of this 
study.  Version  2  of  this  study  only  analyses  the  revised  final  product  description  as 
provided by DT as wholesale product contracts to DG Competition end of July 2017. 

Handover: 
DT’s  VULA  product  offers  a  local  handover  at  the  street  cabinet  (MSAN)  level.  An 
additional  VULA  handover  point  at  higher  network  level  is  not  offered  for  state  aid 
purposes160. Handover at the MDF level from all MSANs located in cabinets can only 
be achieved by using duct access or, in the event that this infrastructure is not available, 
fibre backhauling for each of the handover ports in the MSAN161. This is not in line with 
best practice VULA, which includes shared backhauling from the street cabinet and an 
aggregated  handover  point  at  the  MDF  location  at  least  as  a  second  option.  Because 
DT argues that there would not be active handover equipment located at the MDF sites 
due  to  its  BNG  architecture,  it  refers  to  a  second  product, the  BNG  L2  bitstream  as  a 
higher network level handover VULA-like product. This product will be considered in a 
separate  section  (5.4).  The  number  of  access  seekers  per  handover  point  in  case  of 
state aid is not restricted (at the outset, access is limited to two access seekers, but DT 
confirmed that it will in the framework of its technical possibilities propose solutions for 
further access in case additional access is demanded). With respect to the number of 
handover  interfaces,  DT  has  introduced  a  capacity  restriction  of  10  Gbit/s  per  MSAN. 
Also here, DT committed to offer within its technical possibilities proposals for solutions 
to increase this capacity in case demand should go beyond the defined limit.162,163 (In 
case  of  Vectoring  I  the  number  of  access  seekers  is  limited  to  one).  One  option  for 
adapting capacity could be implementing additional switches at the MSAN sites if more 
than 2 access-seekers request access. This would entail adding an Ethernet switch in 
the  MDF.  However,  it  should  be  noted  that  DT  could  also  do  this  instead  of 
implementing  small  switches  at  each  cabinet  at  the  MDFs,  thus  offering  an  integrated 
handover  point  at  the  MDF  sites  combining  all  MSANs  of  an  access  area  for  one 
handover port, or several ports if required for uncontended handover. Adopting such a 
solution instead of cabinet handover would enabling several wholesale seekers access 
to the VULA infrastructure from the outset164.  

160   DT AG, KVZ-AP-F V04-11, Hauptvertrag, 31.7.2017, p. 2 
161   One  can  assume  a  high  probability  that  at  least  a  dark  fibre  is  available  because  the  cabinets 

considered are served by FTTC.  

162   The  pricing  will  follow  the  general  pricing  provision  as  set  out  in  the  NGA  Germany  decision,  see 

footnote 24 there.  

163   DT AG, KVZ-AP-F V04-11, Anhang A Leistungsbeschreibung ÜA, 31.7.2017, p. 2 
164   In average there are 41 cabinets per MDF location, most hosting at least one MSAN, plus at least one 
MSAN  per  MDF  location  for  aggregating  the  A0  lines.  Using  one  well  scaling  Ethernet  switch  at  the 
MDF  locations  is  significantly  more  efficient  than  deploying  Ethernet  switches  at  the  cabinet  sites. 
Even assuming that no switches will be required due to the poor demand at the cabinet sites there is 

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Technicalities of VULA products 

Thus far the VULA defined only includes FTTC access. One could imagine that in case 
of  FTTB/H  on  a  point-to-multipoint  fibre  access  topology  the  relevant  OLT  systems 
controlling the fibre plant might also be hosted in the MDF locations. These then could 
also  be  integrated  in  the  VULA  handover  switches  in  order  to  enable  unique  VULA 
handover  ports  over  all  access  technologies.  Furthermore,  it  is  reasonable  to  assume 
that  DT  already  operates  Ethernet  switches  in  most  of  the  relevant  MDF  locations  in 
order to aggregate its L2 Ethernet leased line traffic. Thus such existing switches could 
be upgraded for the VULA traffic instead of adding switches.  

In any case, best practice is to integrate the different access network technologies into 
one  VULA  product  family,  handed  over  by  one  interface,  distinguished  by  access 
speeds only according the best the technology at an access line can offer. DT’s KVz-AP 
products do not meet this criteria because they are technology dependent and restricted 
to  FTTC  deployment  areas.  FTTH  GPON  based  deployments  are  not  included,  but  at 
least in theory could also be relevant in the state aid areas. DT expressed its intention 
to pursue the aim of a common VULA-family due to the network efficiencies which can 
be achieved by this. 

Generic access: 
DT  offers  a  Layer  2  handover  protocol165.  DT  thus  follows  best  practice.  It  now  also 
offers  unlimited  access  to  the  technical  capabilities  of  the  copper  access  line  and 
supports uncontended VULA and  handover. The handover ports are offered with 1-10 
Gbit/s166.  Since  the  cabinet  VULA  does  not  offer  any  synergistic  and  cost-efficient 
common  backhaul  use  there  is  no  risk  of  contention  in  this  VULA  product.  Thus 
bandwidth can be determined by the access-seeker to a wide extent. In this regard the 
approach is according to best practice.  

Supporting  a  stack  in  stack  (tagged)  VLAN  approach  is  also  best  practice.  Each  end-
customer of an access seeker can be addressed by a unique (outer) S-VLAN address. 
The inner C-VLANs are passed through DT’s access network in a transparent manner. 
DT  provides  for  VLAN  tagging  with  3  872  addressable  VLANs  per  end-customer167 
which  can  be  considered  as  sufficient.  However,  with  handover  at  higher  levels  the 
limited S-VLAN address space could be too small, requiring additional handover points 
due to address space instead of capacity constraints.  

In the final version, DT's VULA offers an  MTU-size of a maximum of 1 950 Byte, thus 
above  1  580  Bytes168.  This  is  in  line  with  the  best  practice  VULA  of  1,580  bytes 
minimum. 

an indication that an aggregating switch at the MDF site is more efficient than using 42 parallel fibres 
(or wavelength) and the appropriate ports for backhauling instead to the BNGs.  

165   DT AG, KVZ-AP-F V04-11, Anhang A Leistungsbeschreibung ÜA, 31.7.2017, p. 2 
166   DT AG, KVZ-AP-F V04-11, Anhang A Leistungsbeschreibung ÜA, 31.7.2017, p. 3 
167   A small part of the total addressee space of 4,094 addresses is not made available. See DT AG, KVZ-

AP-F V04-11, Anhang A Leistungsbeschreibung ÜA, 31.7.2017, p. 2 

168   DT AG, KVZ-AP-F V04-11, Anhang A Leistungsbeschreibung ÜA, 31.7.2017, p. 3 

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Technicalities of VULA products 

There  is  a  unique  customer  line-ID  and  dedicated  logical  connections  per  end-
customer169 170.  

There is no multicast frame replication offered. DT’s argumentation that it would not be 
required  at  the  MSAN  level  may  be  in  line  with  best  practice  in  the  case  of  cabinet 
VULA aggregating only a small number of end-customers of the access seeker. There 
would be a need for multicast frame replication only where a larger number of A0 lines 
are aggregated in MSAN at the cabinet sites (near shore Vectoring), and in any case for 
MDF  and  higher  handover  levels  multicast  frame  replication  would  result  in  significant 
efficiency  improvements.  In  case  of  multicast  the  address  concept  shall  be  reviewed 
also.171 

Access seeker’s control: 
Free choice of CPE 
Free choice of CPE is guaranteed by German law172. The modem between the router 
and  the  network  access  line  at  the  end-customer  site  can  be  chosen  freely  by  the 
access  seeker,  but  must  meet  the  VDSL  Vectoring  requirements  according  to  the 
technical  description  1TR112.  These  modems  support  the  U-RV  interface  conditions 
published  on  DTs  homepage  and  enable  advanced  error  control  features  to  be 
performed by DT. This is best practice VULA.  

Control of the whole technical capacity of the access line 
With the DT VULA product, the access seeker can make use of the maximum technical 
and  physical  capabilities  of  the  access  line,  control  bandwidth  guarantees  and 
bandwidth classes, traffic symmetry and traffic service classes173. This is best practice 
VULA.  

Operator control of own end-customer ports of an MSAN 
Full control over MSAN port parameters is not provided. DT confirms, however, that it 
does  not  use  any  product  specific  optimization  in  this  respect,  but  a  network-wide 
automated  optimization  for  all  customers.  On  this  basis,  the  access  seeker  is  not 
discriminated  by  not  receiving  control  over  MSAN  port  parameters  but  receives  the 
same automated optimization as DT uses for its own offering. In case DT should move 
from  automated  optimization  to  product-specific  modifications  and  differentiation,  a 

169   DT AG, KVZ-AP-F V04-11, Anhang A Leistungsbeschreibung ÜA, 31.7.2017, p. 3 
170   A  unique  end-customer  addressing  is  only  implemented  for  the  handover  points.  This  could  be 

improved for being unique per wholesale seeker in order to better meet best practice VULA. 

171   In  DT’s  addressing  concept  there  is  one  S-VLAN  per  access  seekers’  end-customers.  This  is  a  1:1 
VLAN concept. There is no capability foreseen to address many (all) access seekers’ end-customers 
by a common VLAN (N:1 VLAN), which would be required to implement a Multicast frame replication 
per access seeker (see German NGA Forum recommendation). 

172   CPE  is  not  part  of  the  contract,  see  DT  AG,  KVz-AP-F  V04-13,  Anhang  A  Leistungsbeschreibung 

VDSL, 31.7.2017, p. 2 

173   DT AG, KVz-AP-F V04-13, Anhang A Leistungsbeschreibung VDSL, 31.7.2017, p. 2 

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possibility will be given to access seekers to ask for modified profiles in cooperation with 
DT.174  

Security measures at layer 3 and above 
Support for  access seekers with respect to security can be considered as fulfilled: DT 
guarantees protocol transparency for layer 2. Therefore, no security functions of higher 
protocol layers are affected and, moreover, DT also guarantees protocol transparency 
for all higher levels.  

Fault management capabilities 
Regarding fault management, DT requires the access seekers to migrate to a new error 
management system175 in 2019. Then an effective fault management system with real-
time diagnosis and analysis, MTR targets/KPI monitoring and damage compensation is 
offered.176 It will offer two interfaces, one web based automatic interface for machine to 
machine  communication  and  one  dialog  based  interface  over  an  internet  portal  for 
manual  input  of  single  failure  repair  notifications.  This  feature  is  already  part  of  the 
submitted  near  shore  area  product  description,  and  thus  should  be  available  for  state 
aid  areas  also.  A  coupling  and  interchange  of  trouble  tickets  would  be  useful  to  even 
improve the cooperation between the operators, but is missing.  

SLA compliance by KPI monitoring and compensation system 
Supporting  their  access  availability,  DT  gives  a  clear  definition  of  faults  by  describing 
technical  transmission  quality  parameters  which  have  to  be  met  -  otherwise  a  fault  is 
assumed and repair action has to be started177.  

Control of business and operation support systems 
Sufficient control of the operational support system and the business support system is 
provided.178  Regarding  the  business  support  system,  interfaces  for  order,  provision, 
change  and  termination  of  the  VULA  services  DT  mandates  the  use  of  its  WITA 
electronic interface, as soon as it is available for these products. It is positive that such 
an interface will exist (with the near shore VULA), but it would be even better if DT also 
committed  itself  to  use  the  German  NGA-Forum  standard  S/PRI  4.0  interface. 
Otherwise the access seekers would need to provision, adapt and operate at least two 
different  interfaces  (WITA  and  the  best  practice  S/PRI  4.0  interface)  resulting  in 
increased complexity and cost. Some maximum provisioning targets have been defined 
for both sides including  compensation in case targets are not met (end line: 50% and 
above  of  the  one-time  provisioning  fee,  handover  point:  15%  -  100%  of  the  one-time 
fee). A certain disadvantage is that these are proposed only to be paid at the request of 
the access seeker and could require significant documentation and administration effort.  
For  bulk  migration  in  case  of  product  upgrades  or  wholesale  provider  changes,  the 

174   DT AG, KVz-AP-F V04-13, Anhang A Leistungsbeschreibung VDSL, 31.7.2017, p. 2 
175   called ESS, Elektronische Entstörschnittstelle 
176   DT AG, KVz-AP-F V04-13, Anhang A Leistungsbeschreibung VDSL, 31.7.2017, p. 6-7 
177   DT AG, KVz-AP-F V04-13, Anhang A Leistungsbeschreibung VDSL, 31.7.2017, p. 8 
178   DT AG, KVz-AP-F V04-13, Anhang A Leistungsbeschreibung VDSL, 31.7.2017, p. 3-5 

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submitted  product  description  simply  refers  to  the  appropriate  user  agreement  for  the 
WITA  interface  with  forecast  in  advance,  which  cannot  be  checked  in  detail.  At  a  first 
glance this forecast solution seems to be in line with best practice VULA. However, this 
issue  was  not  given  significant  focus  in  the  comments  received  of  the  BMVI  VULA 
consultation. 

Migration: 
There is no forced migration taking place in the far shore state aid Vectoring cases in 
Germany.  So  it  is  outside  the  relevant  scope  of  this  expert  analysis.  Forced  migration 
could  theoretically  only  occur  in  the  (unlikely)  situation  that  in  these  state  aid  areas 
there  are  existing  commercial  FTTC  operators  (which  had  deployed  FTTC  VDSL 
without  state  aid  previously  offering  bandwidth  below  the  state  aid  relevant  threshold) 
who  are  excluded  from  a  cabinet,  due  to  vectoring.  In  this  case,  the  KVZ-AP-I  rules 
would have to be applied. These are not part of the submitted documents for state aid 
VULA. While these rules incorporate some form of advanced notification and migration 
process and also compensation in the form of a wholesale price reduction which is not 
directly correlated to the stranded investment,179 they are not in line with what has been 
described as best practice in this regard in section 4.4 above. In any event, according to 
our knowledge, there has not yet been any migration to a VULA product following the 
Vectoring I rules at all. 

Bulk  migration  is  part  of  the  standard  provisioning  procedures  and  forecast  processes 
described  in  the  paragraph  before.  Some  disadvantages  of  the  forecast  process  – 
exchanging own market expectations with the competing incumbent – are discussed the 
NetCologne migration section (section 5.3.3).  

Price: 
The  price  set  for  the  far  shore  VULA  (KVz-AP-I)  according  to  the  Vectoring  I  decision 
applies  only  to  the  wholesale  customer  which  has  been  excluded  from  cabinets.  It 
includes  compensation  for  being  pushed  out,  which  according  to  DT,  should  not  be 
made applicable to all wholesale seekers which are now permitted to access VULA at 
the  near  shore  and  far  shore  state  aid  cabinets  (KVz-AP-F).  Instead,  according  to  its 
submitted state aid application,180 DT intends to apply the commercial near shore price 
(KVz-AP-N)  once  approved  by  BNetzA,  to  the  state  aid  VULA  also.  The  price 
components  they  name  are  best  practice  for  bottom-up  price  regulation.  There  is  no 
discussion  of  the  price  structure.  The  final  price  structure  and  pricing  level  will  be 
determined  by  the  NRA  BNetzA.  The  price  is  outside  the  judgement  of  this  expert 
analysis.   

179   only the subloop charge and shared electrical power and operation costs of the VULA equipment have 

to be paid per wholesale access line, see DT’s submitted VULA application 

180   DT: Antrag auf Vorlage, pp. 18 

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Result: 
The DT state aid VULA product (KVz-AP-F) characteristics set out above are reflected 
in  the  contract  provided  by  DT  (version  provided  on  31  July  2017).  The  DT  VULA 
provides a handover location only at cabinet level. Some disadvantages with respect to 
the foreseen migration processes exist. The exact price is outside the judgment of this 
analysis. Apart from this, the DT VULA fulfils the best practice criteria. 

5.3.2  Other DT cabinet VULA products 

In  its  updated  VULA  submission  DT  states  that  the  market  might  expect  a  uniform 
VULA  product  provisioning  procedure  in  all  Vectoring  application  areas.  This  would 
approach  VULA  best  practice.  So  far  there  still  are  differences  in  the  access 
connection’s availability181 (97%, 98%, 98,5% in average per year), in the provisioning 
times  for  a  VULA  access  and  the  handover  port.  There  also  differences  in  the  fault 
management  interaction.  This  may  be  caused  by  the  coming  availability  of  Error 
Support System (ESS), which was not available when defining the far shore (KVz-AP-I). 
So  the  early  VULA  products  did  not  meet  the  VULA  best  practice  criteria  as  now 
defined.    

We  note  also  that  the  older  far  shore  product  offers  bandwidth  limited  line  access 
speeds  in  several  steps.  Its  handover  is  restricted  to  one  dedicated  access  seeker, 
namely  the  operator  which  is  excluded  from  the  cabinet.  No  other  access  seeker  is 
allowed  to  access  the  VULA  product  but  instead  must  rely  on  a  L2  bitstream  access, 
whose handover was recently defined as being located at the BNG locations. The VULA 
capabilities of this solution will be analysed in section 5.4. Since the near shore and far 
shore VULA products are not directly part of the state aid procedure, the study does not 
further  on  analyse  these  but  simply  refers  to  the  VULA  best  practice  of  a  uniform 
product. 

5.3.3  Submitted NetCologne product 

NetCologne (NC) is a regional broadband operator founded in 1994, which operates in 
the  western  part  of  the  federal  state  Nordrhein-Westfalen.  While  many  areas  are 
densely populated, there are also rural and sparsely populated areas within this region 
which might be subject to state aid. 

The VULA product submitted by NetCologne is restricted to Vectoring in case of state 
aid..  New  and  improved  product  contracts  have  been  provided  by  the  end  of  July, 
beginning of August 2017. They are the basis of the results presented now. 

181   A  VULA  is  a  dedicated  connection  between  the  access  seeker’s  end-customer  and  the  handover 
point,  whose  average  up-time  is  described  by  the  availability  of  this  access  connection  in  %  of  the 
year.  

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Handover: 
The  handover  point  is  located  at  the  cabinet182.  The  cabinet  handover  point  can  be 
backhauled  using  empty  ducts,  dark  fibre  or  Ethernet  leased  lines.  These  ancillary 
products would be separately charged. A handover point at higher network level is not 
offered183.  The  number  of  handover  points  can  be  expanded  by  NetCologne  on 
demand184. There is no DSLAM aggregating handover point, e.g. at the MDF level, nor 
is there one handover for all technologies which NC is using in its access network and 
could be subject to state aid.185 There could exist at least in theory, several handover 
points  per  DSLAM,  because  each  DSLAM  port  card186  is  handed  over  by  a  separate 
interface and backhaul link (fibre, L2 leased line), if required187. NetCologne explains to 
be  open  to  apply  the  same  processes  of  providing,  operating  and  repairing  for  other 
future fibre based VULA products thus supporting a common VULA product family. 

Generic access: 
NetCologne  offers  a  Layer  2  handover  protocol188.  The  bandwidth  offered  is 
unconstrained189  and  only  determined  by  the  physical  and  technical  characteristic  of 
the  access  line.  Both  these  features  are  in  line  with  VULA  best  practice.  Contention 
problems  should  not  arise  because  the  product  does  not  include  an  aggregating 
backhaul offer.  The handover ports are offered with up to 10 Gbit/s190. The DSLAMs 
used today are limited to 2.5 Gbit/s per port card. 

NC  offers  VLAN  tagging,  addressing  the  end-customer  over  the  S-VLAN  and 
transparently  passes  the  C-VLAN  to  the  end-customer,  thus  NetCologne  provides  for 
VLAN  tagging  with  4  094  addressable  VLANs  per  end-customer191.  The  QoS  priority 
bits of the C-VLAN are also passed through transparently. The VLAN structure is N:1. 
This all is in line with VULA best practice and also follows the recommendations of the 
German  NGA-Forum.  The  MTU-size  is  up  to  1  580  Bytes192.  There  is  a  unique 
customer  line-ID  according  to  the  German  NGA-Forum  specifications  and  there  are 
dedicated  logical  connections  per  end-customer  (both  best  practice  VULA).  Multicast 
frame  replication  or  other  multicast  support  can  be  added  on  demand  via  a  separate 

182   NC VULA Rahmenvertrag V1.0, 1.8.2017, p. 3 
183   But  there  is  an  option  of  a  remote  handover  by  an  additional  agreement,  NC  VULA  Rahmenvertrag 

V1.0, 1.8.2017, p. 4  

184   NC VULA Technische Leistungsbeschreibung, 2.8.2017, p. 4 
185   Main broadband access technologies used in the NC network are FTTB and DOCSIS 3.0 (cable-TV) 

networks.  

186   Each  port  card  typically  has  48  or  72  end-customer  ports.  An  access  seeker  having  more  end-
customers  than  port  on  a  single  port  card  is  rather  unlikely  in  state  aid  funded,  sparse  populated 
areas. It will depend on market share and cabinet size.   

187   This is caused by DSLAM architecture reasons. It can be more a theoretical than a practical problem. 
188   NC VULA Anlage B Leistungsbeschreibung, 1.8.2017, p. 3 
189   NC VULA Anlage B Leistungsbeschreibung, 1.8.2017, p. 3 
190   NC VULA Anlage B Leistungsbeschreibung, 1.8.2017, p. 3, 5 
191   NC VULA Technische Leistungsbeschreibung, 2.8.2017, p. 6 
192   NC VULA Anlage C Technische Leistungsbeschreibung, 2.8.2017, p. 6 

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agreement193  (this  however  is  in  line  with  best  practice  for  VULA  at  this  handover 
point).194  

Access seeker’s control: 
Free choice of CPE 
Free choice of CPE is guaranteed by German law.195. Technical characteristics for the 
modem  at  the  customer  premise  are  not  submitted.  Thus  it  is  not  possible  to  order 
support  similar  to  that  optionally  offered  by  DT  (see  section  5.3.1,  access  seeker’s 
control).196  

Control of the whole technical capacity of the access line 
The access seeker is given control of bandwidth and profiles. This makes best use of 
the  maximum  physical  and  technical  access  line  capacity.  The  bandwidth  may  be 
symmetric or asymmetric. The priorities are determined (by the P-bits in the C-frames 
set) and controlled by the access seeker. All this is in line with VULA best practice.   

Operator control of own end-customer ports of an MSAN 
Full control over MSAN port parameters is not provided. NetCologne confirms, however, 
that  it  does  not  use  any  product  specific  modifications  for  its  own  offerings  to  end-
customers  and  reverts  to  different  profiles  only  in  case  of  faults.  On  this  basis  the 
access seeker is not discriminated by not receiving control over MSAN port parameters. 
NetCologne confirms that in case it should turn towards product-specific modifications, 
the  same  possibility  will  be  open  to  access  seekers  who  may  demand  such 
modifications for their own products from NetCologne.197 

Security measures at layer 3 and above 
Support  for  access  seekers  with  respect  to  security  can  be  considered  as  fulfilled: 
NetCologne  guarantees  protocol  transparency  for  layer  2.  Therefore,  no  security 
functions  of  higher  protocol  layers  are  affected  and,  moreover,  NetCologne  also 
guarantees protocol transparency for all higher levels. 

Fault management capabilities 
An  effective  fault  management  system  with  real-time  diagnosis  and  analysis,  MTR 
targets,  KPI  (key  performance  indicators)  monitoring  and  damage  compensation  is 
offered198. Regarding fault management, NC offers a web based diagnosis interface for 
the  access  lines,  allowing  monitoring  of  the  essential  line  parameters  (VULA  best 
practice). However the diagnostic interface does not allow the access seeker to change 

193   NC VULA Anlage C Technische Leistungsbeschreibung, 2.8.2017, p. 6 
194   The handover at NC is per port card. The end-customers of an access seeker are all concentrated on 
such  card.  It  will  depend  on  the  number  of  customers  and  their  viewing  behavior  if  multicast  can 
reduce the handover interface bandwidth demand.  

195   The NC VULA is defined without a CPE, see NC VULA Anlage C Technische Leistungsbeschreibung, 

2.8.2017, p. 3 

196   At the time of product definition submission the Free Router Choice Law  was not yet decided in the 

German parliament. 

197   NC VULA Anlage C Technische Leistungsbeschreibung, 2.8.2017, p. 5 
198   NC VULA Anlage E Betriebskonzept, 1.8.2017 

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and test DSLAM line parameters199. According to the submitted documents, there is no 
electronic  exchange  of  trouble  tickets.  Instead,  the  errors  are  reported  over  the  S/PRI 
interface,  which  has  been  standardized  by  the  German  NGA  Forum.  A  clear  fault 
definition supporting the availability KPI provided is offered200.  A maximum of 24 hours 
repair time is committed for the end-customer line, and 12 hours for the handover port 
(best  practice).  An    average  availability  per  year  (%  uptime)  is  not  defined  for  the 
connection as a whole, but only for some network elements (the line availability has to 
be computed by the wholesale customer out of the single elements). NC offers a 24h/7d 
repair service for failures of significant importance affecting 100 customers or more or 
affecting  handover  interfaces  (this  is  best  practice).  Since  the  end-customers  of  an 
access  seeker  are  all  located  on  the  same  port  card,  these  are  typically  below  this 
threshold and therefore could be subject to discrimination. The failure of such port cards 
is included in the significant failure definition. Overall, the fault management capabilities 
can be considered as acceptable in the framework of the purpose of this study.   

Control of business and operation support systems 
Sufficient control of the operational support system and the business support system is 
provided.201  The  BSS  system  interaction  for  order,  change,  termination  etc.  is  offered 
over  the  German  NGA-Forum  specified  S/PRI  interface  release  3.0.  An  upgrade  to 
release  4.0  was  announced.  It  is  also  best  practice  to  offer  SLAs  for  the  electronic 
interface like NC provides.  

SLA compliance by KPI monitoring and compensation system 
However,  as  with  the  repair  times  and  provisioning  processes,  there  are  no  KPI 
monitoring systems with automatic compensations. So this is an area of improvement, 
but negligible in the overall context of this expertise.   

Migration: 
In  the  context  of  the  state  aid  VULA,  a  forced  migration  cannot  be  expected  to  be 
relevant for NC. A bulk migration nevertheless may occur if there are advertisements for 
major  product  upgrades  which  stimulate  increased  orders  from  end-customers.  This 
should  be  handled  through  the  forecast  processes.  This  can  be  seen  as  VULA  best 
practice,  but  would  require  the  access  seeker  to  inform  the  wholesale  provider  in 
advance  of  its  advertisement  plans,  thus  risking  pre-emption  by  the  access  provider. 
This is a general problem which is  not confined to this type of access, and we do  not 
have any suggested alternatives at this time. For KPI monitoring and compensation, we 
refer to the paragraph above. 

199   Multi-tenant capabilities are not implemented by the DSLAM suppliers, because not demanded by the 

network operators. 

200   NC VULA Anlage E Betriebskonzept, 1.8.2017, p. 4 
201   NC  VULA  Anlage  B  Leistungsbeschreibung,  1.8.2017,  p.  3,  NC  VULA  Anlage  E  Betriebskonzept, 

1.8.2017 

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Price: 
The price structure described in the submitted documents is reasonable from a bottom-
up  price  definition  point  of  view  and  does  not  include  a  bandwidth  dependent 
component, but it includes a risk for the access seekers because of the dedicated port 
card  concept  of  NC.  The  port  card  is  not  shared  with  other  operators’  end-customers 
and  is  paid  for  only  by  the  access  seeker  to  whom  it  is  dedicated.  This  is  not  best 
practice. The position “connected VULA port” in the monthly fee of NC’s price structure 
remain  unclear  regarding  the  cost  included  here  in  addition  to  the  already  considered 
port card. Furthermore, it seems as if the cost of the DSLAM chassis itself would not be 
recovered through a monthly fee,  but through a one-time  charge, which also covers a 
share of the cost of the cabinet provisioning. We believe that this structure is not in line 
with  best  practice  VULA  for  regulatory  cost  determinations.  It  is  an  approach  of  risk 
sharing, which at least should be made clear in advance and typically results in some 
discounts202  for  the  access  seekers.  It  is  not  however  possible  to  verify  whether  the 
system  is  reasonable  without  concrete  figures  and  discount  schemes.  The  price  is 
outside the judgement of this expert analysis.  

Result: 
The  NetCologne  VULA  product  characteristics  set  out  above  are  reflected  in  the 
contract provided by NetCologne (in the version provided on 01 August 2017 except for 
Annexes D1 and C: Annex D1 provided on 31 July 2017 and Annex C submitted on 2 
August  2017).  The  contracts  can  be  considered  as  fulfilling  the  best  practice  criteria 
(with the exception of the handover point and leaving aside the pricing).  

5.3.4  Submitted DNS:NET product  

DNS:NET  is  a  regional broadband  network  provider  founded  in  2009, operating  in  the 
federal  states  of  Brandenburg  and  Sachsen-Anhalt  in  around  300  cities  and  local 
communities. It connects approximately 120,000 households203.  

DNS:NET has submitted its proposal for a VULA product and additional explanations in 
several  stages,  and  has  reacted  to  the  comments  of  BNetzA.  DNS:Net  observes  that 
according  to  its  existing  contract  with  DT  for  physical  unbundled  access,  it  is  not 
allowed to resell SLU directly to other operators, and thus assumes that access seekers 
for the VULA product offered would have their own LLU/SLU contract with DT. Hence 
the DNS:NET contract is restricted to the DSLAM port, DSLAM and handover port use. 
They would be open also to reselling the SLU, if permitted. 

Handover: 
DNS:NET  offers  a  handover  point  at  street  cabinet  level  with  1  Gbit/s  or  10  Gbit/s 
interfaces  and  a  fibre  port204.      DNS:NET  provides  on  a  voluntary  basis  an  optional 

202   See the DT Kontingentmodell approved by BNetzA. 
203   http://dns-net.de 
204   DNS:NET Hauptvertrag VULA V 2-2, 31.7.2017, p. 3 

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handover point at BNG level for its VULA product via a shared use of its own backhaul 
link  to  regional  BNG,  an  access  seeker  individual  backhaul  capacity  capable  of 
aggregating several cabinets and provided by DNS:NET or an access seeker individual 
backhaul  fibre  per  MSAN205.  This  is  in  line  with  VULA  best  practice.  The  number  of 
access seekers at the MSAN handover is not restricted. An additional gateway will be 
installed  in  case  of  demand206.  For  each  handover  there  is  a  spare  fibre  pair 
available207. The contract documentation submitted concentrates on the state aid VULA 
and  does  not  include  other  broadband  technologies  (e.g.  FTTH).  Apart  from  this, 
DNS:NET  confirms  in  addition  that  in  case  it  would  engage  into  a  subsidized  FTTH 
deployment  which  would  require  a  VULA  product,  the  criterion  of  a  common  VULA-
family would be respected208 209. 

Generic Access: 
As  required,  the  DNS:NET  VULA  product  offers  a  handover  protocol  as  Layer  2 
Ethernet210.  The  bandwidth  is  unconstrained  and  allows  to  make  use  of  the  technical 
and  physical  characteristic  of  the  access  line.  The  handover  ports  with  1  Gbit/s  or  10 
Gbit/s allow for an uncontended handover. This is in line with VULA best practice, even  
taking  into  account  that  in  case  of  several  access  seekers  at  an  MSAN  the  additional 
use  of  a  gateway  in  theory  could  influence  the  contention  behavior.  VLAN  tagging  is 
implemented and allows for 4 096 customers per VLAN211. The MTU size is larger than 
the best practice minimum of 1 580 Bytes212.  There is a dedicated logical connection 
identify  each  wholesale  seeker  end-customer  (best 
description  (SID)  used 
practice)213. The availability of an access connection is only provided as the availability 
of the elements of the involved network elements of the value chain, excluding the sub-
loop provided by DT. Thus, the value has to be calculated by the access seeker out of 
the elements given. While not ideal, this can be considered as acceptable.214 Multicast 
frame  replication  is  offered  as  additional  option  in  case  an  access  seeker  chooses  to 
use the BNG as handover point.215 

to 

205   DNS:NET Anhang1 Technische Leistungsbeschreibung VULA, 31.7.2017, p. 6, p. 9, p. 20 
206   DNS:NET Anhang1 Technische Leistungsbeschreibung VULA, 31.7.2017, p. 5 
207   DNS:NET Anhang1 Technische Leistungsbeschreibung VULA, 31.7.2017, p. 8 
208   DNS:NET Anhang1 Technische Leistungsbeschreibung VULA, 31.7.2017,  p. 20 
209   The homepage reports about an FTTH project in Sachsen-Anhalt, Zweckverband Breitband Altmark 
210   DNS:NET Anhang1 Technische Leistungsbeschreibung VULA, 31.7.2017,  p. 8 
211   DNS:NET  Anlage  2  Entstörung,  …,  31.7.2017,  p.  2,  DNS:NET  Anhang1  Technische 
Leistungsbeschreibung  VULA,  31.7.2017,    p.  8,  p.  16;  DNS:NET  Anlage  1-DSLProfile,  …  V  2-1, 
31.7.2017, p. 2 

212   DNS:NET Anhang1 Technische Leistungsbeschreibung VULA, 31.7.2017,  p. 18 
213   DNS:NET Anhang1 Technische Leistungsbeschreibung VULA, 31.7.2017,  p. 10 
214   DNS:NET Anlage 2 Entstörung, …, 31.7.2017, p. 2-3 
215   DNS:NET Anhang1 Technische Leistungsbeschreibung VULA, 31.7.2017,  p. 18, DNS:NET Anlage 2 

Entstörung, …, 31.7.2017, p. 2 

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Access seeker’s control: 
Free choice of CPE 
Free  choice  of  CPE  is  guaranteed  by  German  law216.  According  to  the  German  Free 
Router Choice Law DNS:NET will have to allow a wide range of routers. The white list 
submitted will not be sufficient – however, it only represents a recommendation.  

Control of the whole technical capacity of the access line 
Bandwidth  control  is  provided.  As  long  as  the  access  line  specific  bandwidth  can  be 
forwarded  uncontended  to  the  handover  point,  no  further  bandwidth  guarantees  and 
prioritization schemes or symmetry obligations are required to be in line with VULA best 
practice.  

Operator control of own end-customer ports of an MSAN 
Full control over MSAN port parameters by access seekers would require the technical 
feature  of  multi-tenancy  which  is,  however,  currently  not  available  on  the  market. 
DNS:NET  offers  access  to  the  port  parameters  for  the  wholesale  access  seekers,  for 
example  by  controlling  the  signal  to  noise  ratio  and  by  having  a  choice  between 
different line profiles which can be determined by the wholesale seeker in cooperation 
with DNS:NET217.The access seeker is able to control its DSLAM ports itself using an 
electronic  web  based  API  interface.  It  allows  the  access  seeker  to  provision  a  port, 
activate  it,  deactivate  it  and  requests  a  port  statistic,  providing  relevant  fault  analysis 
information.  

Security measures at layer 3 and above 
Support  for  access  seekers  with  respect  to  security  can  be  considered  as  fulfilled: 
DNS:NET guarantees protocol transparency for layer 2. Therefore, no security functions 
of  higher  protocol  layers  are  affected  and,  moreover,  DNS:NET  also  guarantees 
protocol transparency for all higher levels218. 

time 

to  repair) 

Fault management capabilities 
An  effective  fault  management  system  is  provided  including  a  real-time  diagnosis, 
MTTR  (mean 
indicators) 
monitoring219.  Regarding  fault  management,  DNS:NET  is  open  to  interconnect  the 
trouble ticket systems,  which would be best practice.  DNS:NET included a clear  fault 
definition  into  its  contract220.There  is  a  commitment  for  a  maximum  repair  time  of  8 
hours  for  the  most  relevant  failures,  unrestricted  by  weekends  or  bank  holidays.  Thus 
this is more than best practice.  

targets  and  KPI  (key  performance 

216   CPE  is  not  provided  by  DNS:NET,  DNS:NET  Anhang1  Technische  Leistungsbeschreibung  VULA, 

31.7.2017,  p. 9, see also DNS:NET Anlage 2 Entstörung, …, 31.7.2017, p. 2 

217   DNS:NET  Anhang1  Technische  Leistungsbeschreibung  VULA,  31.7.2017,    p.  10,  15,  DNS:NET 

Anlage 1-DSLProfile, … V 2-1, 31.7.2017, p. 2 

218   DNS:NET Anlage 1-DSLProfile, … V 2-1, 31.7.2017, p. 5 
219   DNS:NET Anlage 2 Entstörung, …, 31.7.2017, p. 2-3 
220   DNS:NET Anlage 2 Entstörung, …, 31.7.2017, p. 4 

94 

 
                                                 
Technicalities of VULA products 

Control of business and operation support systems 
Sufficient control of the operational support system and the business support system is 
provided221.  Orders  and  terminations  (BSS)  can  be  placed  over  a  web  based  API. 
Some  disadvantages  are  worth  to  be  mentioned:  The  interface  seems  to  be  simplistic 
and  not  able  to  deal  with  additional  typical  BSS  processes  for  change  of  product 
features,  addresses,  customers,  products  etc.  This  interface  is  not  in  line  with  the 
German  NGA-Forum  S/PRI  4.0  interface.  It  remains  unclear  how  changes  can  be 
processed.  It  remains  to  be  seen  if  the  support  of  an  order  process  intermediary  can 
overcome  this  weakness.  In  any  case  these  deficits  appear  to  be  minor  in  the  overall 
context and thus are acceptable in the framework of the purpose of this study.  

SLA compliance by KPI monitoring and compensation system 
DNS:NET  offers  access  seekers  the  option  of  defined  automatic  compensation 
payments which are triggered in case of deviation from certain thresholds222. 

Migration: 
There is no enforced migration expected in the case of DNS:NET, especially not in the 
context of state aid. Thus there is no need for compensation and bulk migration rules. 
For upgrading reasons etc. DNS:NET commits its customers to forecast demand. In the 
absence of a forecast the work will be performed by prioritizing the forecasted work (in 
line with VULA best practice).  

Price: 
There  are  no  (public)  price  lists  available.  DNS:NET  states  that  the  prices  will  be 
oriented towards the regulated prices. The VULA price will be a flat fee independent of 
the bandwidth and service used. Both is best practice. Additional components like fibre 
backhauling or shared backhauling will be priced separately (in principle best practice, 
but  the  level  is  unclear  (and  intransparent)).  There  are  also  no  price  components 
described for the shared backhauling. This is not in line with VULA best practice. The 
price is outside the judgement of this expert analysis.  

Result: 
The DNS:NET VULA product characteristics set out above are reflected in the contract 
provided  by  DNS:NET  (version  provided  on  31  July  2017).  The  contracts  can  be 
considered  as  in  line  with  the  best  practice  criteria  (except  for  the  pricing  which  is 
however outside the judgment of this expert analysis).    

221   DNS:NET Anhang1 Technische Leistungsbeschreibung VULA, 31.7.2017,  p. 6, DNS:NET Anlage 1-

DSLProfile, … V 2-1, 31.7.2017, p. 4 

222   DNS:NET Anlage 2 Entstörung, …, 31.7.2017, p. 5 

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Technicalities of VULA products 

5.3.5  Interim Summary 

None  of  the  products  analysed  are  completely  in  line  with  best  practice  described  in 
section 4. No VULA product offers a consolidated handover point at the MDF level, and 
the  products  at  a  level  above  (BNG)  are  only  offered  by  DT  (via  the  L2  BSA)  and 
DNS:NET, but at least in case of DT also do not meet the VULA best practice criteria. 
There  are  deficits  in  the  OSS  and  BBS  interfaces,  which  we  judge  to  be  negligible 
taking  into  account  that  small  alternative  operators  would  have  to  make  large  efforts 
which might not be proportionate to the small market covered if they had to provide a 
fully-fledged S/PRI interface and the supporting systems. It could instead be appropriate 
to cooperate with an intermediary which offers such interfaces and apply simpler means 
of controlling processes and operations towards small operators. In the context of state 
aid  one  could  expect  a  sufficient  level  of  quality  for  the  access  seekers  and  the  end-
customers involved with the solutions offered by the operators.  

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Technicalities of VULA products 

Table 5-2 

Comparision of best practice VULA characteristics between the 
submitted cabinet VULA products  

Point of local handover

Handover location

No. of ANO per handover point

Number of handover interfaces

DT

KVZ-AP-F

cabinet only
Two (solutions for 
expansion to be sought in 
case of demand)
Two 10G per MSAN for max 
448 ports (solutions for 
expansion to be sought in 
case of demand)

NetCologne

DNS:NET

cabinet only

cabinet, BNG optional

not limited

unlimited

10G per portcard for 48 ports 
each, expandable

10G for max. 192 ports, 
expandable 

One common VULA product family

declaration of intent

declaration of intent

declaration of intent

Generic Access:

L2 Protocol

offered

offered

offered

Upgrade backhaul capacity

uncontended

max. 2,5 G uncontended

uncontended

10 G interface

VLAN tagging

No. of VLAN end customer

Max MTU size
Ded. connection per end-cust./ 
availability connection

Unique customer ID

1-10G

offered

3,872

max. 1.950 Byte

offered

offered

10G/ max 2,5 G

offered

4,094

1,580

offered

offered

1-10G

offered

4,096

> 1580

offered

offered

Multicast frame replication

n

on demand, add. agreement

optional

Access seeker’s control:

CPE: by ANO  resp. end-customer

Bandwidth control by ANO

Control of MSAN port parameters

Security: support for access seeker 
available

Fault management:

Real-time diagnosis and analysis

Clear fault definition

MTR targets/ KPI monitoring

Damage compensation
Sufficient control of operational 
support system (OSS) and business 
support system (BSS)

Migration:

Advance notification 

Bulk migration process

Migration KPI Monit./ compens.

Compensation of frustr. Invest

Price:

bottom-up regulatory costing

Uncont. price bandwidth indep.

Cont. below, share of uncont.

offered

offered

offered

offered

offered (in case of product 
specific approach)

offered (in case of product 
specific approach)

offered

offered

offered

offered

offered

offered

offered

na

forecast

n

n

offered

offered

offered

offered

offered

na

forecast

n

n

unclear

unclear

na

offered

offered

offered

offered

offered

offered

offered

offered

offered

na

forecast

n

n

n, risk sharing model

y, oriented at reg. prices

y

na

y, oriented at reg. prices

unclear

97 

 
  
   
Technicalities of VULA products 

On  the  positive  side,  one  has  to  state  that  all  products submitted  make  utmost  use  of 
the technical and physical characteristics of the access lines in order to provide highest 
possible  bandwidth  and  thus  product  definition  freedom  regarding  bandwidth.    Except 
for  the  handover  location  which  should  in  our  view  be  at  a  higher  network  level  and 
should then also offer an effective multicast frame replication, as well as some aspects 
on the pricing and the migration, all three VULA-products fulfill in their final version the 
best practice criteria.  

The  product  of  DNS:NET  seems  to  best  support  access  seekers  regarding  their 
influence  on  the  DSL  profiles  and  line  parameters  of  each  of  the  end-customer 
connecting ports. One has to admit that the capabilities of the systems constrain what is 
technically  possible.  Multi-tenant  capabilities  are  not  available  in  the  market  to  the 
extent  required  for  this  type  of  wholesale  application.  Even  if  one  finds  VULA  best 
practice in the market it is not obvious that all operators could meet these. One has to 
analyse the selected platform capabilities, which may vary depending on their age and 
software releases.  

Defining  VULA  best  practice  or  required  characteristics  in  advance  of  all  state  aid 
applications could have an influence on the supplier market, requiring the operators to 
buy  equipment  which  fulfils  the  required  characteristics,  especially  regarding  multi-
tenancy. The larger the footprint for such networks, the more the suppliers are willing to 
offer appropriate systems. Therefore, we assume a Europe-wide approach would have 
more success than one taken at a national level. 

However, in the absence of such a standardised approach, the only solution that can be 
pursued in the context of German state aid is to take an individual approach to adjusting 
the  existing  platforms  to  ensure  competition  and  achieve  the  utmost  benefit  for  the 
market and the end-customers affected. 

5.4  Layer 2 Bitstream 

When DT applied for the KVz-AP product to be submitted to the European Commission, 
DT also submitted a layer 2 Bitstream product with handover at the BNG level, stating 
that  it  would  complement  the  VULA  at  cabinet  level  and  meet  the  European  VULA 
criteria.  We  have  shown  that  best  practice  handover  is  preferred  to  be  at  a  more 
centralized (BNG) level, where it is technically and economically feasible. Therefore in 
this  section  we  analyse  whether  the  L2  bitstream  product  included  in  the  application 
also meets the best practice VULA characteristics as described in section 4 above. In 
principle a BNG VULA product would be based on the cabinet VULA, with the addition 
of a common Backhaul link and a more combined handover at the higher level. When 
comparing  it  with  best  VULA  practice,  we  therefore  pay  particular  attention  to  the 
backhauling conditions. 

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Technicalities of VULA products 

Handover: 
DT’s L2 handover is only offered at the BNG location, taking place per each individual 
BNG,  without  any  further  concentration  per  BNG  handover  location.  So  the  access 
seekers  must  order  access  at  each  BNG  located  at  an  IP-POP.  A  discussion  has 
already started as to whether the BNG handover is local at all, or if it is to be seen as a 
regional handover. If it is interpreted as a regional handover, it would by definition not 
fulfil the local criteria of VULA, but only be qualified for providing bitstream access. DT 
first  took  the  position  that  it  should  be  viewed  as  local  handover  and  refers  to  the 
accepted  definition  of  VULA  handover  as  being  at  parent  nodes  in  the  U.K.  (section 
3.4). BNetzA  does not accept that the BNG L2 bitstream can be considered ‘local’, but 
does not explain why new entrants can only access a market 3b product (L2 bitstream) 
for  far  shore  non  state  aid  areas  instead  of  a  market  3a  VULA  in  case  of  vectored 
cabinets.  

The position of access seekers is typically, that if there is no MDF VULA a BNG VULA 
might  be  acceptable,  but  then  should  fulfill  all  best  practice  VULA  characteristics.  We 
observe  that  handover  best  practice  also  includes  VULA  handover  at  regional  nodes, 
typically in addition to local (MDF) nodes. So far DT’s view was in line with best VULA 
practice.  Not  in  line  with  best  practice,  is  the  segmentation  into  several  BNGs  per 
location223, and the fact that access seekers do not have clear information concerning 
which  access  areas  can  be  accessed  on  which  BNG  and  if  and  to  what  extent  an 
access  area  might  be  distributed  over  several  BNGs.  A  unique  handover  per  BNG-
location, as would be expected according to best VULA practice, is not offered. Also not 
addressed and missing is how other broadband access technologies like FTTH GPON 
might fit into this VULA concept. This question could be answered now, and must in any 
event be answered if and when an operator applies for GPON state aided roll out. DT 
changed its view that the L2 bitstream is a VULA product when it recognized during the 
process that it then should have to meet multicast frame replication requirements. Thus 
it restricted its VULA product to a cabinet (MSAN) handover only. 

Generic access: 
In contrast to the cabinet VULA, DT did not improve the specifications for BNG VULA 
regarding the speeds of the access lines. Access seekers must choose from amongst 
several  bandwidth  steps,  and  this  does  not  allow  them  to  make  the  best  use  of  the 
technical  and  physical  characteristics  of  the  access  line.  In  the  submitted  application 
there are no guarantees or transparent contention planning rules, or any other  means 
that  guarantee  backhaul  bandwidth  control  as  is  best  practice  for  contended  or 
uncontended  VULA.  There  are  also  no  KPIs  defined  to  monitor  such  guarantees  or 
other  measures  aimed  at  limiting  contention.  Regarding  the  VLAN  specifications,  we 
refer to the cabinet VULA of DT discussed above (section 5.3.1).  

223   There  are  typically  several  BNGs  per  handover  location  (IP-PoP),  see  Figure  5-8.  Each  of  these 
BNGs  has  its  own  handover  interfaces  for  L2  bitstream,  see  Figure  5-3.  There  is  no  aggregation  of 
these interfaces towards one single handover port for an access seeker at one handover location. 

99 

 
                                                 
Technicalities of VULA products 

Multicast frame replication is not supported. This is a relevant criterion at the BNG level, 
even  regarding  interfaces  per  each  individual  BNG224.  At  this  network  level,  multicast 
frame replication is VULA best practice. Moreover, it could be considered discriminatory 
for DT not to offer it because one has to assume that DT  is using it for its own IP-TV 
customers  inside  any  of  the  BNGs  –  otherwise  the  interfaces  to  their  LSRs  would  be 
inefficiently large. 

Access seeker’s control: 
Regarding the free choice of the CPE we refer to the cabinet VULA paragraphs above 
(section 5.3.1). The Free Router Choice Law of Germany is in line with best practice, as 
are the choices available for the line terminating modems.  

There  is  an  ongoing  debate  between  the  Commission  DG  CONNECT  and  BNetzA 
regarding the appropriate conditions which signify that an access seeker has adequate 
control.  We  refer  in  this  context  to  DG  CONNECT’s  last  Decision  regarding  the  L2 
bitstream reference offer225. Regarding the quality control of the backhaul capacity we 
refer to the description of best VULA practice above. Regarding the fault management 
system ESS and the OSS and BSS interfaces and the KPI monitoring we also refer to 
best  practice  (section  4.3)  and  the  comments  related  to  the  cabinet  VULA  product 
(section 5.3.1). 

Migration: 
One  could  expect  a  need  for  bulk  migration  given  the  likelihood  that  the  Vectoring-I 
decision IP layer 3 interim bitstream access products will be migrated to a L2 bitstream 
at  the  BNG.  There  may  also  be  a  need  for  a  forced  migration  in  case  of  the 
implementation of the near shore area Vectoring-II, which would require operators using 
VDSL on LLU to migrate to VULA.  

In  this  context,  there  should  be  assurance  that  best  practice  implementing  rules  for 
mass  migration  and  for  compensation  of  stranded  investment  will  be  applied.  No 
migration  cost  should  be  charged  by  the  incumbent  in  these  cases  according  to  best 
VULA  practice.  These  migration  processes  should  also  be  KPI  monitored  and 
accompanied  by  automatic  compensation  in  case  targets  are  not  met.  Thus  far 
however, no detailed migration provisions have been set out respectively submitted. 

224   DT  states  in  its  state  aid  VULA  application  (Antrag  auf  Förderfähigkeit  des  KVz-AP…)  that  savings 
can be achieved by multicast only, if at the handover point so many end-customers are connected that 
a frequent parallel viewing of the same channel is probable. In case of a BNG handover this is given. 

225   EC DG CONNECT regarding Case DE/2016/1934, C(2016) 8366 final of 5. December 2016 

100 

 
                                                 
Technicalities of VULA products 

Pricing: 
BNetzA notified its pricing proposal for the L2 bitstream access (at the BNG level) to the 
EC on 18. November 2016. The prices came into force 22. December 2016. There is a 
price band between  

−  15,17 €(month for an ADSL access line with unlimited speed and 

−  19,10 €/month for a VDSL Vectoring access connection with up to 100 Mbit/s. 

These values include a total sum traffic226 of 1.5 respectively 7.29 Mbit/s included. Only 
the  pricing  for  the  vectored  access  is  relevant  to  be  considered  in  this  study.  The 
limitations on upper bandwidth and a total sum traffic are not in line with a best practice 
VULA  pricing.  This  provides  a  further  indication  that  the  L2  bitstream  product  as 
currently defined cannot be considered equivalent to an uncontended VULA. (see also 
section 4.5). 

226   Gesamtsummenverkehr 

101 

 
                                                 
Technicalities of VULA products 

6 

Implications  of  FTTC/VDSL  and  vectoring  for  competition  in 
German market 

In this chapter we consider the implications of the planned deployments on competition 
in the German market with reference to the counterfactual of physical unbundling as the 
primary wholesale access mechanism for broadband. This in principle covers near and 
far shore access areas.  

•  Section 6.1 recalls the conditions DG Competition set for the implementation of 

state aid for high speed networks in Germany 

•  Section 6.2 defines physical unbundling and describes a counterfactual scenario 
in  which  physical  unbundling  continues  in  its  current  form  as  the  predominant 
mechanism for access competition 

•  Section 6.3 analyses the technical and economic implications of FTTC/VDSL on 

physical unbundling 

•  Section 6.4 considers the additional technical and economic impacts on physical 
unbundling  of  applying  vectoring  as  foreseen  in  the  German  market,  and 
assesses whether the proposed street cabinet VULA solution would address this 
concern or if there are alternative solutions which could mitigate these effects 

6.1  Commitments regarding network access 

In its letter to the German authorities of 15.06.2015227, the Commission noted that: 

•  The  selected  network  operator  must  provide  open  and  non-discriminatory 
wholesale access to the subsidized infrastructure (ie the planned deployment of 
FTTC/VDSL  potentially  to  be  deployed  in  combination  with  vectoring).  The 
access  offered  should  include  access  to  ducts,  dark  fibre,  bitstream  access, 
unbundled local loop and street cabinets;228 

•  A subsidy for the construction and operation of an infrastructure where physical 
unbundling  is  technically  or  economically  not  feasible  (for  instance  due  to  the 
vectoring technology) is conditional on the availability of a VULA product that is 
functionally  equivalent 
relevant 
Commission criteria;229 and 

to  physical  unbundling  based  on 

the 

227   SA.38348 (2014/N) – Germany, C(2015) 4116 final 
228   Paragraph 29 
229   Paragraph 30 

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Technicalities of VULA products 

•  The  German  authorities  are  committed  not  to  allow  the  implementation  with 
public funds of technological solutions not supporting physical unbundling before 
the approval of VULA by the Commission.230 

6.2  Physical unbundling – the counterfactual 

The  obligation  of  VULA  is  required  in  circumstances  where  physical  unbundling  is 
rendered technically or economically not feasible by virtue of the state aid measure.  In 
this context it is useful to understand what is meant by physical unbundling. Annex II of 
the 2013 State Aid guidelines state that “physical unbundling grants access to the end-
consumer access line and allows the competitor's own transmission systems to directly 
transmit over it.” 

Physical  unbundling  of  the  existing  copper  infrastructure  is  currently  required  in 
Germany at at least two handover points231. The primary physical unbundling product 
used in Germany today (in common with other EU countries in which copper unbundling 
is effective) involves handover of the copper loop at the Main Distribution Frame (MDF). 
This  wholesale  product  is  commonly  referred  to  as  ‘Local  Loop  Unbundling’.  LLU 
enables  alternative  operators  to  upgrade  copper  lines  using  their  own  ADSL  and 
VDSL232  equipment  in  order  to  supply  broadband,  and  other  services  such  as  voice 
and TV.  

Under  the  existing  implementation  of  LLU  in  Germany,  access  seekers  have  full 
freedom  to  deploy  their  own  equipment  (at  the  MDF  site  as  well  as  the  customer 
premise), and may adapt speeds and retail prices to meet customer demands. Access 
seekers also have sight of the line performance, and can detect if there is a fault on the 
line.  LLU  thus  offers  a  considerable  degree  of  flexibility  to  the  access  seeker.  All  the 
best practice characteristics described for VULA in section 4 can be reproduced by an 
LLU  access  seeker  within  its  own  network.  Only  an  interaction  regarding  the  physical 
unbundled  copper  loop  remains,  which  also  requires  cooperation  with  the  access 
provider regarding ordering, change, termination and fault repair, but with a lower level 
of  complexity  and  with  less  need  for  detailed  specification regarding  product  definition 
and quality.  

As  can  be  seen  from  Figure  6-2,  volumes  of  LLU  in  Germany  have  been  declining  in 
recent years as end-users have migrated to FTTC/VDSL. LLU nonetheless remains the 

230   Paragraph  31  –  a  footnote  also  observes  that  tendering  and  award  of  projects  may  precede  the 
Commission  decision  on  VULA  under  the  conditions  that  the  implementation  of  the  technological 
solutions  not  supporting  physical  unbundling  (eg  vectoring)  only  occurs  once  the  Commission  has 
approved VULA as functionally equivalent to physical unbundling. 

231   In  Germany,  in  addition  to  unbundling  at  the  MDF  site  and  street  cabinet,  physical  unbundling  was 
mandated  at  an  intermediate  new  cabinet  on  main  cables  intended  for  FTTC  and  shorter  copper 
subloops (Schaltverteiler), see Figure 6-1. 

232   In  the  Vectoring-II  procedure  the  use  of  VDSL  has  been  withdrawn.  The  free  use  of  the  LLU  is 

restricted to a frequency along the lines of 2.2 MHz (ADSL2). 

103 

 
                                                 
Technicalities of VULA products 

predominant  form  of  physical  unbundling  (and  wholesale  access  more  generally)  in 
Germany. 

Figure 6-1 

SLU handover points including cascaded and intermediate cabinets 

Source: WIK 

Figure 6-2 

LLU demand (in mio. lines) over time 

Number of LLU in Germany 1998 until 2015 (in million)

12

10

8

6

4

2

0

9,5

9,7

9,5

9,1

8,4

9,3

8,8

8,1

6,4

4,7

3,3

2

1,3

0,03

0,1

0,3

0,9

0,6

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Source: WIK/ Statista 

104 

 
 
 
 
 
 
 
Technicalities of VULA products 

Physical  unbundling  is  also  required  to  be  made  available  at  the  street  cabinet  in 
Germany.  This  form  of  unbundling  is  termed  ‘sub-loop  unbundling’  (SLU).  In  theory, 
subloop  unbundling  could  be  used  by  access  seekers  to  install  their  own  FTTC/VDSL 
lines  potentially  in  conjunction  with  vectoring  (subject  to  the  technical  constraints 
described  below).  This  (use  of  SLU  combined  with  the  installation  of  FTTC/VDSL  and 
fibre  backhaul)  would  enable  alternative  operators  to  offer  similar  products  to  those 
which are intended to be subsidised under the state aid regime. SLU would afford the 
same flexibility to access seekers as LLU (described above). However, in practice take-
up  of  SLU  in  Germany  has  been  low,  and  stood  at  1%  of  DSL  lines  in  2014233.  This 
means  that  FTTC/VDSL  has  been  predominantly  deployed  by  the  SMP  operator  DT. 
The main reason why the usage of SLU is considerably less than that for LLU is that it 
is less economically feasible234. 

While interconnecting at the MDF to use LLU provides access to thousands of lines per 
site,  interconnecting  at  the  street  cabinet  to  use  SLU  provides  access  to  only 
approximately  190  lines  in  average.  Taking  into  account  the  lower  market  shares  of 
typical  alternative  operators  (for  example  between  10-20%),  the  low  number  of 
customers  would  be  insufficient  to  justify  the  investment  in  backhaul  and  FTTC/VDSL 
equipment. Scale economies in less dense and sparse areas such as those that would 
typically  be  targeted  for  state  aid,  would  be  even  less  attractive.  In  such  areas,  an 
alternative operator might, with contributions from state aid, be able to use SLU as the 
first mover – gaining an effective monopoly in NGA in that area (and likely an obligation 
to offer VULA), but there would be no viability for a second FTTC/VDSL network based 
on SLU. This situation will not change in case the monopoly provider deploying FTTC 
with VDSL Vectoring and a VULA handover at the cabinet. The economic prerequisites 
for accessing the cabinet by fibre infrastructure remains the same. There may be some 
savings regarding collocating a second DSLAM at the cabinet site in case of FTTC with 
VDSL  (without  Vectoring),  but  higher  VULA  cost  compared  to  the  SLU  price235.  The 
VULA  product  so  far  is  less  performant  than  the  SLU,  harder  to  manage  and  restricts 
the freedom of product definition (see section 5). This will even be the case with a best 
practice VULA, only to a lower degree. The alternative observed today is a step back in 
the ladder of investment by migration to the best available bitstream. 

VDSL is deployed by the operators (ANO and DT) on copper lines at the MDF and at 
the cabinets (FTTC). Higher bandwidth than ADSL2+ through VDSL deployment at the 
MDF can be received also by end-customers beyond the near shore areas (see Figure 

233   BoR (14) 122, teltarif.de reports at 8.2.2017 14,203 cabinets deployed with Vectoring by competitors 
and  75,935  cabinets  by  DT  (state  20.12.2016,  source:  vectoring  list),  not  included  are  unvectored 
FTTC cabinets such as in existing FTTC state aid regions and other early FTTC deployments not yet 
migrated to Vectoring.  

234   The  LLU  decline  does  not  result  in  an  equal  FTTC/SLU  take  up  by  competitors  nor  in  an  FTTH 
migration,  thus  in  a  climbing  up  the  ladder  of  investment,  but  predominantly  in  a  step  back  to  IP-
bitstream (Kontingentverträge, Vectoring-I decision, Telefonica Germany, Vodafone in non KD-areas) 
and in a sidestep to intermodal competition (Vodafone after the Kabel Deutschland (KD) acquisition in 
KD-areas).  

235   The VULA prices in Germany are not yet fixed by BNetzA. 

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5-1).  Such  increase  would  of  course  be  higher  with  deploying  VDSL  at  the  cabinet 
(FTTC). Deploying Vectoring at the cabinet disables the use of VDSL (in its frequencies 
above  2,2  MHz)  in  the  area  beyond  the  cabinet236.  All  state  aid  areas  are  far  shore 
FTTC,  thus  beyond  the  cabinets.  So  also  in  case  of  state  aid  VDSL  deployed  at  the 
MDF is affected. The core cases to be compared nevertheless are FTTC VDSL cabinet 
collocation (with SLU access for competitors)  and FTTC VDSL Vectoring (and VULA). 

236   The VDSL signals from the MDF have a significantly lower sending power level than those starting at 

the cabinet, thus will be suppressed. 

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6.3  Technical and economic implications of FTTC/VDSL for physical 

unbundling  

6.3.1  Implications for unbundling at the MDF 

Operators  receiving  state  aid  are  obliged  to  provide  fair  and  non-discriminatory 
wholesale  access.  The  EC  2013  Broadband  State  Aid  Guidelines  note  in  this  context 
that  “Especially  in  areas  in  which  there  are  already  competing  basic  broadband 
operators,  it  has  to  be  ensured  that  the  competitive  market  situation  which  existed 
before  the  intervention  is  preserved…  The  subsidized  network  must  therefore  offer 
access under fair and non-discriminatory conditions to all operators who request it and 
provide them with the possibility of effective and full unbundling.”237  

If  a  point  to  point  FTTH  architecture  were  installed  with  the  support  of  state  aid,  non-
discriminatory wholesale access would be achieved by offering physical unbundling at 
the Optical Distribution Frame (ODF). 

However, if instead of point to point, ‘tree-type’ architectures (point-to-multipoint access 
line  topologies)  are  deployed  including  FTTC/VDSL  (with  or  without  the  installation  of 
vectoring) or FTTH PON, there is no technical possibility to offer physical unbundling at 
the  handover  location  where  such  unbundling  normally  takes  place  today.  This  is 
because there is no longer a one-to-one physical connection from the end-user to the 
MDF  site.  In  these  circumstances,  the  only  form  of  access  which  could  provide  non-
discriminatory access on the subsidised FTTx at a similar handover point to that used 
for physical unbundling today, would be a virtual unbundling product.  

This argumentation has been used for the imposition of VULA at handover points at the 
MDF  site  (or  a  subset  of  such  sites)  under  the  ex  ante  market  review  process  in  the 
countries  studied  (see  chapter  3).  It  is  also  in  line  with  the  2013  EC  Broadband  State 
Aid  Guidelines,  which  note  that  “if  the  selected  bidder  rolls  out  a  point-to-multipoint 
topology  network,  it  shall  have  a  clear  obligation  to  provide  effective  unbundling  via 
wavelength  division  multiplexing  as  soon  as 
is  standardized  and 
commercially  available.  Until  WDM  unbundling  becomes  effective,  the  selected  bidder 
shall be required to provide access seekers with a virtual unbundling product, as close 
as  possible  to  physical  unbundling”.238    An  important  observation  is  that  it  is  not  only 
vectoring  which  may  create 
for  physical  unbundling.  The 
technical  obstacles 
construction  of  a  point  to  multipoint  architecture  (whether  FTTC  with  or  without 
vectoring or FTTH PON) also creates obstacles to physical unbundling at the standard 
access location in its own right. 

the  access 

237   Broadband state aid guidelines 2013 paragraph 3.5 (80a) 
238  EC 2013 Broadband State Aid Guidelines footnote 118 

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Unless  the  copper  line  running  from  the  street  cabinet  to  the  MDF  site  is  removed, 
copper LLU would still be available and could be used by alternative operators to deliver 
ADSL  even  if  another  operator  deploys  FTTC/VDSL  or  FTTH  PON.  However,  the 
capacity  available  via  copper  LLU  would  be  significantly  below  that  available  via  the 
subsidised  FTTx  network,  and  thus  the  alternative  operator  would  not  be  able  to 
compete on an equal basis with the operator receiving state aid. Access to copper LLU 
alone (in the absence of a virtual unbundling product offering equivalent access to the 
upgraded  capacity  available  on  the  subsidised  FTTx  network)  could  therefore  not  be 
considered to meet the condition that access should be ‘non-discriminatory’.  

The provision of physical unbundling at the street cabinet (SLU) might still be technically 
possible, but would require additional passive infrastructure requirements (duct or fibre 
to  the  cabinet)  and  additional  aggregation  equipment  at  the  MDF  for  the  high  speed 
traffic from the cabinets. As previously discussed, in the absence of scale economies in 
rural  areas,  it  is  unlikely  to  be  economically  viable  and  would  not  be  a  functional 
substitute for physical unbundling at the MDF site.   

Bitstream access might provide an alternative means for the access seeker to compete 
with  the  operator  receiving  state  aid.  However,  unless  it  meets  the  characteristics  of 
VULA, by definition, bitstream would not provide equivalent flexibility for access seekers 
to innovate as was possible through use of physical unbundling or as is possible for the 
access  provider.  It  could  therefore  not  be  considered  as  functional  equivalent  or 
substitute to physical unbundling.  

Moreover,  it  should  be  considered  that  alternative  operators  using  LLU  have  typically 
already  invested  in  equipment  at  multiple  MDF  locations.  Solutions  such  as  cabinet 
unbundling  or  regional  bitstream  access,  would  result  in  aggregating  traffic  not  at  the 
MDF site, but at different locations and so increase the risk of stranded assets239, traffic 
flow heterogeneity, administration and management for the alternative operators.   

Summary – effect of FTTC/VDSL on MDF unbundling 

The  installation  of  FTTC/VDSL,  FTTH  PON  or  other  technologies  involving  a  ‘tree’ 
architecture  does  not  technically  allow  physical  unbundling  at  the  standard  handover 
point  for  physical  unbundling  (the  MDF  site).  Therefore,  in  order  to  ensure  non-
discriminatory  access  to  the  subsidised  infrastructure,  a  virtual  unbundling  alternative 
(VULA) should be provided at the MDF location or, if this is not technically feasible, at 
another location which would be economically viable for alternative operators. It should 
take into account the need to minimise traffic heterogeneity. 

239   With the introduction of VULA caused by FTTC all access lines so far used by LLU with VDSL have to 
be migrated to VULA. This is a major problem in case of near shore Vectoring, but also affects the far 
shore  deployment  with  and  without  state  aid  –  for  those  MDF  VDSL  lines  which  serve  customers 
beyond  the  near  shore  area.  Also  all  competitor  lines  being  upgraded  to  higher  access  speeds  will 
release its LLU, resulting in a significant amount of stranded investment. 

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6.3.2   Unbundling at the street cabinet 

As  previously  discussed,  there  has  been  limited  take-up  of  physical  unbundling  at  the 
street  cabinet  in  Germany  (and  in  most  other  countries)  due  to  limited  economic 
viability.  If  used  at  all  in  state  aid  areas,  it  is  most  likely  that  it  would  be  used  by  the 
recipient of state aid, ie the first mover, but would not be considered viable for access 
seekers  as  second  movers  following  the  installation  of  a  subsidised  FTTC/VDSL 
network.  Indeed,  if  SLU  and  the  installation  of  a  second  FTTC/VDSL  network  were 
viable,  the  rationale  for  awarding  state  aid  in  that  area  might  itself  be  called  into 
question. 

The  lack  of  economic  viability  for  operators  to  invest  in  installing  duplicate  backhaul 
infrastructure  to  the  street  cabinet,  especially  in  less  dense  areas,  is  demonstrated  in 
research  by  WIK240,  as  well  as  studies  undertaken  by  Analysys  Mason  for  NRAs  in 
Ireland and the Netherlands241.  

As  regards  technical  feasibility,  the  installation  of  FTTC/VDSL  should  not  in  theory 
prevent continued access to the copper subloop for access seekers to deploy a parallel 
FTTC/VDSL  network.  However,  technical  feasibility  for  SLU  might  nonetheless  be 
undermined in the case where 

•  The VDSL implementation interferes with other networks – this may happen as 

volumes increase? 

•  There  is  insufficient  space  in  the  street  cabinet  for  a  second  operator  and 

challenges in installing a second cabinet 

Summary – effect of FTTC/VDSL on subloop unbundling 

FTTC/VDSL should not affect the ability of alternative operators to use copper subloop 
unbundling  and  install  their  own  FTTC/VDSL  equipment,  unless  the  total  number  of 
VDSL customers becomes too large and interference (crosstalk) significantly decreases 
each  customer’s  bandwidth  or  the  installation  of  active  equipment  limits  space  for  a 
second mover and no alternative option is offered. In order to maintain the potential for 
SLU  therefore  in  the  presence  of  FTTC/VDSL,  solutions  are  required  to  ensure 
adequate space and to limit interference from the FTTC/VDSL equipment. 

240   WIK: the economics of next generation access, “008/ 2009, WIK: Implications of a nationwide fibre roll 
out  and  its  subsidy  requirement,  wik,  Bad  Honnef,  October  2011,  WIK:  Der  dynamische 
Investitionswettbewerb  als  Leitbild  der  künftigen  Entwicklung  des  Telekommunikationsmarktes, 
November  2013,  WIK:  Benefits  and  regulatory  challenges  of  VDSL  vectoring  (and  VULA),  Florence 
School of Regulation, March 2014, Florence, EUI Working Papers RSCAS 2014/ 69 

241   Analysys: The business case for sub-loop unbundling in the Netherlands, OPTA, January 2007 
  Analysys: The business case for sub-loop unbundling in Dublin, ComReg, 20. December 2007 

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6.3.3  Implications for VULA handover in the German market 

The proposed VULA offering in the context of state aid in Germany has a handover at 
every  cabinet  (KVz-AP-F).  However,  as  discussed  above,  this  handover  point  is  not 
economically feasible at almost all locations relevant for state aid.  

The  next  access  level  would  normally  be  the  MDF  location  (where  copper  LLU  is 
currently  offered).  This  would  seem  to  be  a  rational  option.  However,  due  to  the  BNG 
network  architecture  DT  argues  that  such  access  would  not  be  technically  feasible  as 
there is no active Equipment at the MDF locations242.  

This  statement  can  however  be  challenged.  There  are  DSLAMs  (MSANs)  for  the  A0 
access lines and the respective KVz-AP-N product handover at the MDF site. There are 
WDM  systems  aggregating  the  DSLAM/MSAN  fibre  links  from  the  MDF  and  cabinets 
towards  the  BNG.  There  are  also  Ethernet  switches  aggregating  and  switching  the 
leased line traffic of the MDF area. In any case from a technical point of view one could 
deploy an Ethernet switch at the MDF location in order to implement a VULA handover. 
This  switch  could  also  aggregate  the  other  cabinet  VULA  products  (near  shore  (KVz-
AP-N), far shore non state aid areas (KVz-AP)). Thus MDF handover (as offered inter 
alia in Denmark and Austria) should in principle be feasible. 

the  DSLAM/MSAN  and 

From a technical point of view a VULA handover could also be implemented at the BNG 
level. However, some modifications would be necessary as the DT product definition for 
BNG  access,  as  notwithstanding  DT’s  claim  that  it  could  provide  a  suitable  access 
solution  in  state  aid  areas  alongside  cabinet  access,  it  does  not  currently  satisfy  the 
definition  for  VULA.  In  order  to  meet  the  VULA  criteria  the  backhaul  link  bandwidth 
between 
the  BNG  might  be  expanded  guaranteeing 
uncontended  bandwidth  for  any  end-customer.  This  could  necessitate  an  increase  in 
the number of BNG required. However, since DT is using a Multicast frame replication 
at  the  BNG  level  and  because  there  would  be a  high  number  of  wholesale customers 
aggregated here, it would be proportionate to offer such a function for competitors also. 
In  practice  a  BNG  handover  would  be  similar  to  the  handover  locations  offered  by 
Openreach  in  the  UK.  From  an  engineering  perspective  there  are  no  technical 
restrictions which cannot be solved.  

Summary – implications of FTTC/VDSL for VULA handover in Germany 

The German authorities have proposed to offer only a VULA solution at street cabinet 
level.  However,  this  would  be  not  be  economically  viable  especially  in  a  state  aid 
context in Germany. There are no over-riding barriers for DT to offer VULA at the MDF 
site (as in Austria and Denmark) or at the BNG location (similar to the UK). 

242   DT:  Förderfähigkeit  von  Vectoring,  Antrag  auf  Vorlage  des  KVz-AP    bei  der  Europäischen 

Kommission, AZ: DG 10/831.1/0, p. 6 

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6.4  Technical and economic implications of FTTC/VDSL with vectoring 

for physical unbundling  

6.4.1  Impact of vectoring on speed and availability of high capacity broadband 

The  characteristics  of  VDSL  and  VDSL  Vectoring  based  transmission  are  already 
described in section 5.1.1.  

VDSL  and  VDSL  Vectoring  can  be  applied  at  MDF  and  cabinet  locations.  In  cases 
where  there  is  no  intermediate  cabinet  between  the  MDF  site  and  customer  (in 
Germany the so called A0 access lines) the only rational location is the MDF location.  

Although  it  cannot  fully  address  the  length  limitations  inherent  in  bandwidth  provided 
over  copper  networks,243  vectoring  can  increase  the  bandwidth  transmittable  over  a 
longer line length, offering an increase in the relevant capacity for line lengths of up to 
800 – 1000m (see Figure 5-6).  

It  is  interesting  to  note  in  this  context  that  in  Germany  a  significant  number  of  VDSL 
lines  have  been  deployed  at  MDF  locations  through  LLU.  The  performance  of  MDF 
VDSL  is  weaker  than  the  achievable  bandwidth  using  VDSL  DSLAMs  in  the  cabinets, 
as  cabinets  are  closer  to  end  customers,  with  shorter  access  lines.  However, 
deployment  of  VDSL  at  the  MDF  site  is  more  economically  feasible  for  alternative 
operators than installing fibre and VDSL in the street cabinet. Thus far, the MDF VDSL 
lines  have  not  involved  vectoring,  because  it  was  not  permitted.  However,  in  the 
Vectoring-II procedure, DT and some alternative operators have committed themselves 
to  deploying  VDSL  vectoring  at  the  MDF  (A0  lines)  and  cabinets  (FTTC)  in  the  near 
shore area, on the basis that they will be granted exclusivity. 

Summary – implications of vectoring on speed and availability 

Vectoring,  a  technology  which  minimises  cross-talk  between  lines  within  a  cable  can 
offer  higher  bandwidths  than  FTTC/VDSL  in  the  absence  of  vectoring.  It  can  also 
extend  the  reach  of  higher  bandwidths.  Vectoring  is  typically  deployed  in  conjunction 
with  FTTC/VDSL  at  the  street  cabinet,  but  VDSL  (with  or  without  vectoring)  can  in 
principle also be deployed at the MDF site. In Germany VDSL has been used with LLU 
by some alternative operators. 

243   Another  physical  effect  of  length  dependent  signal  attenuation  is  caused  by  the  electrical  Ohm 
resistant of the copper lines, so even with Vectoring there remains a bandwidth and signal decrease 
over the line length, which naturally limits the length of the copper access networks. 

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6.4.2  Technical implications of vectoring for physical unbundling 

The  implementation  of  vectoring  creates  further  technical  challenges  beyond  those 
raised  by  FTTC  deployment,  affecting  the  viability  of  physical  unbundling  at  both  the 
MDF site (LLU) and  street cabinet (SLU). 

Vectoring is a technology which increases bandwidth potential by eliminating cross-talk. 
In order to achieve this,  the Vectoring processor must have access to all copper lines in 
order  to  be  able  to  estimate  the  crosstalk  effects  in  real-time.  The  Customer  Premise 
Equipment  must  also  support  Vectoring  for  successful  operation.  If  only  one  access 
copper pair transmitting information cannot be involved in the cross talk correction, this 
results  in  a  significant  decrease  of  the  theoretically  possible  bandwidth  increase 
enabled by Vectoring. This effect is even stronger in an unbundling situation where two 
DSLAMs of different operators are accessing pairs within the same access cable.  

Physical  unbundling  therefore  has  the  potential  to  undermine  the  effects  of  vectoring. 
This  is  the  primary  technical  reason  why  NRAs  in  countries  such  as  Belgium  and  the 
Netherlands  have  discontinued  SLU  in  the  presence  of  vectoring.244  To  ensure 
effective  communication  across  the  cable,  FTTC/VDSL  vectoring  may  also  require 
limitations  on  the  use  of  physical  unbundling  at  the  MDF  site  (LLU).  In  some 
implementations  such  as  in  Austria  and  Belgium,  MDF  LLU  has  been  partially245 
withdrawn.  In  Germany,  an  upper  limit  of  2,2  MHz  transmission  frequency  has  been 
required  for  the  remaining  copper  LLU  transmission  methods,  typically  POTS,  ISDN, 
classical  modems,  telefax,  and  xDSL  up  to  ADSL2+.  However,  the  use  of  higher 
bandwidth transmission methods is not allowed because of Vectoring constraints. 

In  practice  in  the  German  case,  this  means  where  FTTC  is  installed  in  the  far  shore 
areas, the MDF LLU based VDSL access lines serving end-customers in the far shore 
area  with  bandwidth  above  the  ADSL2  level  can  no  longer  be  operated  at  the  higher 
bandwidth,  because  the  VDSL  DSLAMs  at  the  cabinets  will  disturb  the  MDF  based 
VDSL signals. In addition DT has applied for Vectoring in the near shore area, requiring 
all VDSL installations to be switched off and migrated to a VULA or bitstream product 
(see section 5.1.1). Thus the VDSL installations at the MDF will need to be migrated for 
this reason (Vectoring II) independent from the state aid decision.  

The submitted VULA offerings aim to remedy the impact of FTTC/VDSL with vectoring 
on  physical  unbundling  by  offering  a  virtual  unbundling  product  at  the  street  cabinet 
level. This could replace the SLU that would no longer be technologically feasible due to 
vectoring.  However,  this  solution  would  not  address  the  core  problem,  discussed  in 
section  6.3.1,  that  physical  unbundling  of  the  enhanced  infrastructure  at  or  near  the 

244   See  case  studies  in  the  WIK  2016  study    Regulatory  approaches  to  risky  bottleneck  assets 

https://www.ofcom.org.uk/__data/assets/pdf_file/0027/82728/wik_regulatory_approaches_to_risky_bo
ttleneck_assets.pdf 

245   Austria  allows  applying  VDSL  Vectoring  in  all  MDF  locations  without  LLU  used  by  competitors. 

Belgium does not enable LLU to be used in conjunction with VDSL2 – BoR (14) 122. 

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MDF  site  (the  predominant  hand-over  point  for  physical  unbundling)  would  not  be 
possible.  

VULA  at  the  street  cabinet  would  also  not  provide  a  solution  to  address  technical 
limitations  on  the  use  of  LLU  including  the  use  of  LLU  with  VDSL  by  alternative 
operators at the MDF site, which arise from vectoring. 

In this regard it should be noted that on 3. November 2016, BNetzA further notified to 
the  EC  a  consolidated  draft  decision  (2.  part)  regarding  a  standard  reference  offer  for 
Layer  2-Bitstream  Access.  In  its  supporting  evidence246  it  refers  to  the  Vectoring-I 
decision  (far  shore)  and  states  that  the  need  for  a  L2  bitstream  access  product  is 
caused by the introduction of a “protected” Vectoring deployment in the cabinets. “For a 
“protected”  use  of  Vectoring  access  to  all  LLU  is  required,  and  unbundled  physical  to 
the  local  loop  is  no  longer  possible.”  This  would  imply  even  greater  restrictions  on 
unbundling. 

Various reports have been made concerning the possible development of multi-vendor 
vectoring solutions that would address this problem and therefore enable the continued 
use  of  physical  unbundling  in  the  presence  of  vectoring.247  However,  despite 
announcements  and  promises  from  suppliers  and  the  efforts  taken  by  the  Italian  NRA 
AGCOM  over  several  years,  there  is  no  solution  available  which  would  enable  the 
exchange  of  Vectoring  information  across  DSLAMs  of  the  same  or  different  suppliers. 
Therefore,  until  such  multi-vendor  solutions  are  developed,  it  must  be  assumed  that 
physical  unbundling  at  the  MDF  and  at  the  street  cabinet  (SLU)  is  technically 
incompatible  with  vectoring,  and  thus  a  virtual  alternative  (VULA)  would  need  to  be 
offered in the circumstance where vectoring is permitted. 

DT has argued that a VULA offered at the street cabinet would address access-seekers’ 
needs  in  the  case  of  FTTC/VDSL  vectoring.  This  might  go  some  way  towards 
addressing  the fact that SLU would no longer be technically viable. 

However,  offering  a  VULA  handover  at  the  street  cabinet,  would  not  change  the 
economic  viability  for  alternative  operators  to  access  the  cabinet  with  their  own  fibre 
infrastructure,  which  as  previously  explained,  is  limited,  especially  in  state  aid  areas. 
There may be some savings regarding collocating a second DSLAM at the cabinet site 
in  case  of  FTTC  with  VDSL  (without  Vectoring),  but  this  would  be  offset  through  a 
higher VULA cost compared to the SLU price248.  

246   BK3d-15/003,  Beschluss  2.  Teilentscheidung  –  Konsolidierungsentwurf  –  Überprüfung  des 
Standardangebotes  der  DT  über  Layer  2-Bitstream  Access,  page  9,  referring  to  BK3d-12/131  from 
29.8.2013 (Vectoring-I decision) 

247   See 

for  example  Colmegna,  Galli,  Goldburg 

(2012)  http://www.assia-inc.com/technology-

media/knowledge-center/white-papers/FASTWEB-
ASSIA_White_Paper_on_Vectoring_(April%202012).pdf 

248   The VULA prices in Germany are not yet fixed by BNetzA. 

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Indeed,  an  example  from  areas  which  are  commercially  served  with  vectoring  in 
Germany provides evidence that access to a VULA at the street cabinet would be even 
less  economically  attractive  to  access  seekers  than  the  currently  available  physical 
unbundling product SLU. 

Specifically, in far shore areas without state aid, Vectoring Decision I requires that those 
operators  which  had  already  used  SLU  to  deploy  VDSL,  but  are  excluded  from  a 
cabinet  by  DT  must  be  offered  VULA  at  the  cabinet  (KVz-AP,  Vectoring  I  decision). 
However,  even  though  these  alternative  operators  have  already  secured  customers, 
deployed infrastructure to the street cabinet and would benefit from an exclusive right to 
street cabinet VULA access at an attractive price (similar to SLU), we understand that 
this offer has not been taken up by the operator affected. One reason may be the loss 
of the ability to sufficiently differentiate its product offering, which renders cabinet VULA 
even less attractive than physical unbundled access at the street cabinet249.  

It should also be noted that because all state aid areas are far shore FTTC, VDSL at the 
MDF  would  also  be  affected  where  state  aid  is  provided  for  the  deployment  of 
FTTC/VDSL with vectoring, The proposed street cabinet VULA would also not address 
this issue, or implementations of vectoring which would technically undermine the use 
of LLU more widely. 

There  is  thus  a  strong  economic  rationale  that  the  primary  handover  point  for  VULA 
should  be  located  at  the  same  or  similar  viable  primary  handover  point  as  is  used  for 
physical  unbundling  (LLU)  today.  As  previously  discussed  handover  at  the  MDF  site 
should be a viable solution. Alternatively, access at the BNG may be another option, if 
the product meets the criteria for VULA. Indeed, DG Connect observed in a 2016 letter 
to  BNetzA250  that  the  Layer  2  bitstream  product  at  the  BNG  was  considered  a  very 
important replacement for the loss of physical VDSL unbundling due to vectoring. In this 
context,  DG  Connect  argued  that  the  functional  characteristics  for  the  replacement 
(BNG)  product  should,  as  closely  as  possible,  correspond  to  the  characteristics  of 
physical access.  

249   This  KVz-AP  product  is  the  only  up  to  date  regulated  far  shore  area  VULA  product.  The  KVz-AP-F 
product  analysed  in  this  study  will  differ  from  it  (see  section  5.3.2).  The  KVz-AP  product  price 
according  to  the  Vectoring  I  decision  is  known.  It  is  expected  to  be  lower  than  the  KVz-AP-F  price, 
because  it  takes  the  compensation  of  the  frustrated  investment  for  FTTC  into  account.  Frustrated 
investment at the cabinet  will not be relevant in case of state aid  and are not included in DT’s price 
structure submitted. 

250   C(2016)8896 

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Technicalities of VULA products 

Summary – technical implications of vectoring for physical unbundling 

Because vectoring requires information to be shared across all lines in a cable, it is not 
currently compatible with local loop and subloop unbundling and competition in VDSL. 
LLU from the MDF may still be used, but with limitations on available frequencies and 
bandwidth.  Multi-vendor  vectoring  solutions  which  would  enable  FTTC/VDSL 
competition on the basis of SLU have been announced, but are not as yet deployed in 
practice.  Thus  VULA  would  be  needed  to  overcome  the  loss  of  physical  unbundling 
capabilities for the high speeds resulting from vectoring. As VULA at the street cabinet 
is not normally economically viable in less dense areas, FTTC/VDSL vectoring VULA at 
the MDF site or another viable location such as BNG would be one solution. 

6.4.3  Alternatives to vectoring that would permit unbundling  

It  should  be  noted  that  a  VULA  solution  will  never  be  a  perfect  substitute  for  physical 
unbundling,  and  thus  accepting  VULA  in  order  to  support  vectoring  is  likely  to  have  a 
competitive ‘cost’ in the following ways:   

•  The  provisioning  processes  may  be  poorer  (more  steps,  two  active  equipment 

operators involved, more complex order interface),  

• 

the  operation  and  fault  repair  may  be  poorer  because  of  the  additional  steps 
over the interfaces between wholesale provider and wholesale seeker.  

•  Only predefined products may be offered 

•  No  product  can  go  beyond  the  highest  parameters  offered  by  the  supplier 

regarding technical features and quality  

•  The  cost  to  alternative  operators  for  software  and  interfaces  with  wholesale 
providers  is  likely  to  be  greater  than  the  cost  to  providers  as  there  are  scale 
economies  involved  which  would  benefit  larger  players,  several  interfaces  are 
required (in Germany at least WITA, S/PRI, …) 

•  Typically  access  seekers  must  differentiate  by  selling  better  products  at  lower 
prices in order to be competitive. This is less possible with VULA products.  

It is thus important to consider counterfactuals in which alternative methods to vectoring 
for increasing bandwidths are pursued251. 

251   See  also  EC  state  aid  decision  SA38.348  of  15.6.2015,  paragraph  34:  “("(34)  As  soon  as  physical 
unbundling  becomes  technically  and  economically  feasible  -  provided  that  technological  products 
necessary for unbundling are commercially available and standardised - the network operator will offer 
physical unbundling. In areas with low population density, where there are limited broadband services, 
or  for  small  local  companies,  the  obligation  to  offer  physical  unbundling  will  only  apply  in  case  of 
reasonable demand." 

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Technicalities of VULA products 

One  technological  solution  which  could  increase  the  potential  bandwidths  available 
through  FTTC/VDSL  without  undermining  physical  unbundling,  is  to  opt  for  a  different 
profile  for  VDSL2  –  profile  35b  (see  also  section  5.1.1).  It  is  already  market  available 
and products can be ordered. Field tests have already successfully performed252.  

Up  to  now  the  most  prominent  profile  in  Germany  is  the  profile  17a,  operating  in  a 
frequency  range  of  up  to  17  MHz.  However,  DSLAMs  are  also  available  using  the 
profile  35b  with  up  to  35  MHz  transmission  frequency  along  the  copper  pairs.  These 
systems allow a doubling of the bandwidth of the profile 17a on short loops, when cross 
talk  is  eliminated  through  vectoring.  However,  even  when  vectoring  is  not  used  in 
combination with profile 35b, the speed targeted by the EC through the Digital Agenda 
for Europe could be met in some circumstances.253 Although using profile 35b without 
vectoring  would  not  achieve  the  higher  bandwidth  available  in  the  Vectored  35b 
solution,  it  would  be  compatible  with  the  continued  physical  unbundling  of  the  access 
infrastructure,  at  least  at  the  location  where  VDSL  is  installed  (at  the  MDF  or  street 
cabinet).  

Summary – alternatives to vectoring permitting unbundling 

Use  of  a  different  VDSL2  profile  instead  of  permitting  vectoring  –  profile  35b,  could 
allow  higher  speeds  (although  less  than  vectoring)  while  maintaining  the  option  for 
physical unbundling (LLU/SLU).  

6.4.4  Implications of alternative solutions to 17a vectoring in the German 

context 

There  are  at  least  two  approaches,  one  with  a  DSLAM  multi-supplier  interacting 
Vectoring  and  one  without  using  Vectoring,  which  would  enable  higher  bandwidths 
whilst maintaining the option for LLU/ SLU unbundling. A third potential scenario would 
combine the profile 35b with a multi-vendor vectoring solution and thereby combine the 
advantages of each. While vectoring profile 35b is market available in 2017, all attempts 
for  multi-vendor  vectoring  according  to  our  observation  are  not  yet  standardized  (see 
also section 5.1.1).  

All three approaches might be applied at the MDF locations and the cabinet sites. They 
all  would  allow  retention  of  Local  Loop  and  Sub  Loop  Unbundling  at  the  MDF  and 
cabinet sites. Applying profile 35b without Vectoring at the MDF would have the effect of 
reducing  bandwidth  beyond  the  near  shore  area  because  of  the  longer  line  length.  It 
consequently may be slightly outperformed by VDSL Vectoring in that area (see Figure 

252   At least Nokia provides systems. DT announced to roll it out early 2017. 
253   The benefit of using higher frequencies will disappear the longer the access line gets, because higher 

frequencies attenuation is stronger than that of lower frequencies. 

116 

 
                                                 
Technicalities of VULA products 

5-7). If the far shore areas are also served by FTTC and unvectored VDSL profile 35b, 
this slight outperformance only occurs at distances beyond 800m behind the cabinet. 

The near shore area is outside the considerations for state aid in this study, because of 
operators  have  already  committed  to  deploying  in  those  areas  in  the  absence  of 
subsidies.  Nevertheless  the  vectoring  solution  proposed  for  the  near  shore  area  will 
also affect those VDSL LLU lines from MDF locations which provide connections to far 
shore areas (incl. state aid areas, which are a subset of these).  

If the proposed vectoring solution is maintained, these LLU VDSL lines would  have to 
be switched off and migrated to VULA at the cabinet or (for A0 lines only) at the MDF.  

In contrast, under a technical solution involving Multi-Vendor Vectoring or VDSL profile 
35b, competitors could make use of LLU unbundling with VDSL for the near shore area 
and serve far shore areas to some extent also, as they do with VDSL and LLU today. 
However, in practice the potential to support competing VDSL offers  based on LLU in 
far  shore  areas  is  likely  to  be  limited.  This  is  because,  if  FTTC  is  deployed  in  these 
areas – even with multi-vendor vectoring or profile 35b - the signals from the DSLAMs 
in cabinets, are likely to outweigh MDF-based signals. 

So  the  benefits  to  competition  in  far  shore  areas  from  the  alternative  solutions  (multi-
vendor vectoring or profile 35b) will be realised only in the unlikely event that additional 
operators  are  able  to  use  SLU  to  deploy  FTTC  with  VDSL  in  competition  with  the 
operator  which  has  received  state  aid.  As  already  stated,  the  competitive  use  of  SLU 
unbundling  (or  cabinet  VULA)  is  highly  unlikely  not  only  in  the  state  aid  areas,  but  in 
most other areas also, except very dense areas. 

Summary – implications for vectoring and alternative solutions in the German context 

Alternative solutions to vectoring are unlikely to have significant relevance in the context 
of  state  aid  in  Germany.  Profile  35b  would  permit  unbundling  at  the  location  of  VDSL 
equipment  (either  MDF  site  or  street  cabinet).  However,  this  solution  would  not  allow 
alternative  operators  to  implement  VDSL  at  the  MDF  site  in  areas  where  FTTC  has 
been  deployed  and  VDSL  has  been  installed  at  the  street  cabinet  with  state  aid.  The 
VULA solutions previously discussed (at the MDF or BNG) are therefore likely to remain 
most relevant. 

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Technicalities of VULA products 

7  Conclusions and recommendations 

•  When  FTTC/VDSL  is  installed,  physical  unbundling  at  the  location  where  it  is 
predominately  used  today  (at  the  MDF  site),  is  not  possible  for  the  enhanced 
infrastructure under the submitted proposals for VULA 

•  The application of vectoring technology creates further technical challenges for 
both physical unbundling at the street cabinet and MDF site. Keeping pace with 
the  technological  progress  under  a  physical  unbundling  business  model  is  no 
longer feasible 

•  Physical  unbundling  provides  wide  scope  for  access  seekers  to  differentiate 
their  retail  offer  from  that  of  the  access  provider  in  terms  of  innovation  in 
equipment, bandwidth control, pricing, quality of service, and repair  

•  Operators  planning  to  make  use  of  broadband  state  aid  in  Germany  have 
notified  street  cabinet  FTTC  VULA  offers  as  a  means  to  address  the  loss  of 
unbundling competition arising from FTTC/VDSL vectoring 

•  The street cabinet VULA offers provide a relatively high degree of flexibility for 
access seekers and thus mirror the functionality of physical unbundling to some 
degree.  However,  these  FTTC/VDSL  vectoring  offers  would  not  in  practice 
address  the  loss  of  competition  from  physical  unbundling  arising  as  a  result  of 
the upgrade because: 

  The handover point (at the street cabinet) is unlikely to be economically 
viable  for  alternative  operators  which  previously  relied  on  unbundling  at 
the  MDF  site  (LLU),  especially  in  sparsely  populated  rural  areas,  which 
are likely to be the target of state aid 

  Cabinet  VULA  would  not  offer  a  replacement  for  LLU  lines  which  have 
been  upgraded  with  VDSL  by  alternative  operators,  but  which  must  be 
migrated to VULA as a result of vectoring deployment 

•  Two  of  the  operators  notifying  cabinet  VULA  products  also  offer  a  layer  2 
bitstream  at  the  BNG  level.  This  handover  point  is  likely  to  be  economically 
viable  for  access  seekers  currently  making  use  of  physical  unbundling. 
However,  the  product  has  not  been  recognized  as  a  substitute  for  physical 
unbundling by the NRA BNetzA (it is a remedy in market 3b WCA rather than 3a 
WLA), and in practice the specifications and pricing structures offered by DT do 
not meet the requirements needed for the product to be a functional substitute 
for physical unbundling. 

• 

In order to ensure continued competition in cases where state aid is granted for 
FTTC/VDSL  vectoring  or  any  other  technical  solutions  which  impede  physical 
unbundling  (including  FTTC/VDSL  without  vectoring,  FTTH  PON  or  other 

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Technicalities of VULA products 

technological  solutions  which  deploy  a  one-to-many  architecture  in  the  access 
network),  a  VULA  product  should  be  provided  at  the  MDF  site  or  a  subset  of 
such (such as the BNG locations). 

•  The  VULA  product  should  meet  the  best  practice  specifications  summarised  in 

the following table. For details we refer to section 4. 

Table 7-1 

Main best practice VULA characteristics 

Characteristic 

Best practice implementation 

Point of 
handover 

1.  VULA should be available at least at the MDF level, or if not feasible, a higher 

(regional) network level 

2.  The number of  wholesale access seekers per handover location should  not be 

limited 

Generic access 

3.  The  size  and  number  of  handover  interfaces  should  be  determined  by  the 

capacity required by end-users of each access seeker.  

4.  A  single  interface  should  be  available  for  all  current  and  future  VULA 

technologies and a single VULA product family should be defined 

5.  VULA should be offered through the layer 2 (Ethernet) protocol 
6.  A  pure  uncontended  VULA  should  be  available.  This  may  be  most  achievable 
with MDF handover. If VULA is made available at the BNG, it should be offered 
in such a way that it could be dimensioned as uncontended254 

7.  10Gbit/s  interfaces  should  be  available  as  required  to  avoid  contention  at  the 

handover interface 

8.  VLAN  tagging  should  be  available.  There  should  be  at  least  4  VLANs  per  end 

customer with the potential for 8 as a reserve for future differentiation 
9.  The MTU (Message Transfer Unit) size should be at least 1580 Bytes 
10.  There  should  be  at  least  one  dedicated  logical  connection  per  customer 
between the handover interface and the CPE, and a unique customer ID which 
can be used by the access provider and access seeker 

11.  Multicast frame replication is not required at cabinet level, but should be offered 

at any level above 

Access seeker’s 
control 

12.  There should be free choice of the end-customer’s CPE eg via a whitelist, with 

the potential to apply for approval for further CPE 

13.  The  access  seeker  should  have  control  of  the  whole  technical  capacity  of  the 
access line – bandwidth control and traffic prioritization would be performed by 
the access seeker alone 

14.  Ideally, access seekers should be able to operate or control their end-customer 

ports in an MSAN 

15.  Access  seekers  should  be  able  to  apply  any  security  measures  at  layer  3  and 

above 

16.  Access  seekers  should  have  fault  management  capabilities  through  access  to 
real  time  line  state  information  and  monthly  line  state  reports.  An  availability 
criterion and a clear fault definition shall exist.  

17.  Compliance  with  service  levels  (SLAs)  for  provisioning  and  repair  should  be 
monitored through KPIs with automatic compensation if targets are not met 
18.  Access  seekers  should  have  control  of  the  operational  and  business  support 

processes 

254   For  example,  the  Austrian  VULA  product  is  offered  with  a  combination  of  guaranteed  backhaul 

capacity and peak capacity to be shared between users in a fair and best efforts manner. 

119 

 
                                                 
Technicalities of VULA products 

Migration 

19.  An early announcement and mutually agreed migration plan should be made 
20.  An automated process should be available for bulk forced migration 
21.  There  should  be  specific  KPIs  applied  for  bulk  migration  with  automatic 

compensation in the event that targets are not met 

22.  In  the  event  of  forced  migration,  there  should  be  compensation  for  stranded 

assets valued at the net book value on the day of migration  

Pricing 

23.  The  FTTC  VULA  price  should  be  cost-based  and  calculated  through  a  BU-

LRIC+ methodology 

24.  For  uncontended  VULA,  a  single  price  should  be  calculated,  based  on  the 
unconstrained  bandwidth  of  the  line  (limited  only  by  technical  physical 
characteristics) 

25.  The  price  for  contended  VULA  should  reflect  a  cost-oriented  share  of  the 

uncontended cost 

•  The  originally  submitted  wholesale  access  products  did  not  meet  the  best 
practice  VULA  specifications  outlined  in  this  study.  An  improvement  process 
lasting from the beginning of 2016 over a first expert evaluation early 2017 to the 
submission  of  final  product  contracts  end  of  July  2017/  beginning  of  August 
2017  resulted  in  acceptable  product  characteristics  meeting  the  state  aid 
requirements to a sufficient extent. We take, however, the view that a handover 
location at the MDF or – if not feasible – at the BNG would have been important 
to  be  fully  in  line  with  best  practice.  Migration  criteria  lose  their  importance  in 
case  of  state  aid  and  pricing  aspects  have  been  excluded  from  the  judgement 
because  they  have  not  yet  been  proposed  for  Germany  nor  evaluated  by  the 
NRA. 

•  Table  7-2  compares  the  submitted  VULA  products  with  the  expectations.  For 

details we refer to sections 5.3 and 5.4 

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Technicalities of VULA products 

Table 7-2 

Comparison of the submitted VULA products against the VULA best 
practice characteristic of section 4   

Point of local handover

Handover location

No. of ANO per handover point

Number of handover interfaces

DT

KVZ-AP-F

cabinet
Two (solutions for 
expansion to be sought in 
case of demand)
Two 10G per MSAN for max 
448 ports (solutions for 
expansion to be sought in 
case of demand)

L2-BS

BNG

NetCologne

DNS:NET

cabinet

cab, BNG optional

unlimited

not limited

unlimited

one per BNG

10G per portcard for 48 ports 
each, expandable

10G for max. 192 ports, 
expandable 

One common VULA product family

declaration of intent

n, FTTC specific only

declaration of intent

declaration of intent

Generic Access:

L2 Protocol

Upgrade backhaul capacity

10 G interface

VLAN tagging

No. of VLAN end customer

Max MTU size
Ded. connection per end-cust./ 
availability connection

Unique customer ID

Multicast frame replication

Access seeker’s control:

CPE: by ANO  resp. end-customer

Bandwidth control by ANO

Control of MSAN port parameters

Security: support for access seeker 
available

Fault management:

Real-time diagnosis and analysis

Clear fault definition

MTR targets/ KPI monitoring

Damage compensation
Sufficient control of operational 
support system (OSS) and business 
support system (BSS)

Migration:

Price:

offered

no

offered

offered

max. 2,5 G uncontended

uncontended

1-10G interface, cont.

10G/ max 2,5 G

offered

uncontended

1-10G

offered

3,872

y

3,872

max. 1.950 Byte

max. 1.950 Byte

offered

offered

n

offered

offered

y/ y

n

n

y

stepwise, no symmetry

offered

4,094

1,580

offered

offered

offered

offered

on demand, add. agreement

y

offered (in case of product 
specific approach)

n

offered (in case of product 
specific approach)

offered

no spec.

offered

offered

offered

offered

offered

offered

no spec

n

n

n

offered

offered

offered

offered

offered

offered

1-10G

offered

4,096

> 1580

offered

offered

offered

offered

offered

offered

offered

offered

offered

offered

offered

Green:  meets  best  practice,  yellow:  facts  still  have  to  be  detailed  by  the  access  provider,  red:  does  not 

meet best VULA practice as defined in section 4 

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Technicalities of VULA products 

Annex  1  –  Questionnaire:  VULA  characteristics,  importance  and 

degree of satisfaction 

Relevance  

Satisfaction 

[High, 
Medium, 
Low, None] 

[0 … 10]  

(10 is highest 
satisfaction) 

Reason/ 
Remark/ 
Specification

Criterion 

Point of local handover at: 

-  Cabinet [y, n] 

-  Local Exchange, MDF [y, n] 

-  Regional level above [y, n] 

-  Other (pls specify) 

-  No. of ANO per handover point (pls specify) 

- 

- 

Is there one handover point for all VULA access 
technologies? [y, n] 

Is there one product family with common characteristics for 
all VULA access technologies? [y, n] 

Generic Access 

-  L2 Protocol [y, n] 

-  Uncontended/ Contention rate (pls specify) 

-  Obligation to increase backhaul capacity in case of 

contention [y, n] 

-  No. of VLAN per ANO and end customer (pls. specify) 

-  VLAN tagging (pls specify) 

-  Max MTU size (pls specify) 

-  Dedicated logical connection per end customer/ availability 

per end user connection (pls specify) 

-  Customer identification for each ANO and its customer  

[y, n] 

-  Multicast support: frame replication functionality [y, n] 

Access seeker’s control: 

-  CPE: by ANO (pls specify: White list, free choice, …) 

-  Bandwidth: differentiated, ANO controlled (pls specify) 

  Control of service profiles (pls specify) 

  Control of DSL profiles (pls. specify) 

-  Guaranteed bandwidth classes (pls specify) 

-  Symmetric bandwidth classes (for business customers) 

(pls Specify)  

-  Traffic prioritization ANO determined (pls specify) 

122 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Technicalities of VULA products 

Relevance  

Satisfaction 

[High, 
Medium, 
Low, None] 

[0 … 10]  

(10 is highest 
satisfaction) 

Reason/ 
Remark/ 
Specification

Criterion 

-  Security: ANO able to provide security means (pls specify)

-  Fault management: ANO receives actual state reports of 

any access line [y, n] 

-  Fault management:  

  Access to diagnosis data included in reference offer [y, n] 

  Choice to change system parameters [y, n] 

  Clear definition of faults (e.g. poor bandwidth) [y, n] 

  Exist MTR targets/ are KPI defined (pls specify) 

-  Damage compensation in case of not meeting targets/ KPI  

[y, n] 

Migration: 

-  Advance notification period (pls specify) 

-  Bulk migration planning [y, n] 

-  Compensation of frustrated investment [y, n] 

-  Who pays for the migration cost (pls. specify) (Wholesale 

provider, each party its part, wholesale seeker, …) 

-  Migration KPI Monitoring (pls specify) 

Price: 

-  Price per VULA per month in average (pls. specify) (One 
time fees depreciated over 3 years, incl. handover ports 
etc., excl. VAT) 

-  Price per VULA per month in % of the LLU fee (pls. 

specify) (see above) 

-  Price per LLU per month (pls. specify) (see above) 

Other: 

(pls. specify) 

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Technicalities of VULA products 

Annex 2 – Country interviews 

Austria 

RTR interview VULA specifications 22 December 2016 

Local access 

There is no cabinet handover for VULA in Austria. The regular handover point is at the 
Local  Exchanges.  Out  of  approximately  1,500  exchanges,  approximately  320 
exchanges are accessed by competitors for LLU. These are the economically attractive 
and  viable  exchanges.  While  in  theory  VULA  handover  could  occur  at  all  exchange 
locations,  it  is  de  facto  restricted  to  these  attractive  locations.  In  a  Local  Exchange 
location,  only  those  end-customers  which  belong  to  its  local  access  area  can  be 
accessed.  

According  to  the  current  VULA  reference  offer,  VULA  with  regional  (central)  handover 
will be available from 31 May 2017. This VULA product will have regional handover at 
11 locations. 8 locations cover the 8 federal states (one per state) excluding Vienna and 
3  (each  of  the  three)  cover  Vienna.  There  is  an  additional  aggregation  function  which 
means that a minimum of 4 handover points are required for national access.   

There  is  no  limitation  of  the  number  of  ANOs  per  handover  point.  A  handover  point 
gives  access  to  all  underlying  NGA  technologies  (Fttx).  There  is  one  VULA  product 
family,  which  is  delivered  on  all  platforms,  limited  in  bandwidth  by  technological 
constraints.  E.g.  a  80  Mbit/s  downstream  product  may  be  delivered  via  FTTH,  FTTP, 
but also on FTTC Vectoring, if the subloop line length is sufficiently short. A handover 
point offers interface capacities of 1G, up to 8 x 1G aggregated255, 10G and up to 8 x 
10G aggregated255.  

Generic access 

The  VULA  product  uses  the  following  technologies  on  the  subscriber  access  line: 
VDSL2,  ADSL2+,  SHDSL,  VPlus  (=VDSL2  profile  35b  and  vectoring),  G.fast 
(vectoring),  GPON  (see  RO  p.  7).  The  availability  of  the  technologies  depends  on  the 
location.  The  standard  handover  protocol  is  Layer  2  (Ethernet)  for  all  access 
technologies.  

A1 TA is obliged to enhance the backhaul capacity of the DSLAMs in case the DSLAM 
management ordered by the wholesale seekers requires this. 

255  Based on Link Aggregation Control Protocol (LACP) IEEE 802.1AX-2008 

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Technicalities of VULA products 

Up to 4 dedicated logical connections are defined per end customer. The VULA service 
(between end user and handover) has an availability of 99.7% per year. The DSLAM – 
handover  connection  has  an  availability  of  99.9%.  This  also  holds  for  the  future 
regional/ central handover.  

As regards other technical characteristics: 

•  The maximum MTU size is 1580 bytes. 

•  Two layer tagging (S-VLAN, C-VLAN) is supported by the handover protocol, but 
both are used for providing the VULA service and therefore cannot be used by 
alternative operators and their (business) customers.256 The larger MTU size 
may allow operators to use further VLAN tags. 

•  There is customer identification for each network operator and customer, every 
end- customer can be individually addressed by 4 VLAN connections (for 4 
different end-user services)  

•  Multicast frame replication is not supported. According to RTR IPTV is not 

relevant in Austria. There are no problems in any event with Multicast if handed 
over at the Local Exchanges,  

•  According to the current VULA reference offer, VULA with regional (central) 

handover, which will be available from 31 May 2017, has the same VULA/ VLAN 
address space. Since VULA is already offered based on G.fast (depending on 
location) this also holds for G.fast DSLAMs (G.fast requires a significantly higher 
number of DSLAMs than FTTC). 

RTR is not aware of complaints regarding these characteristics. 

Access seekers’ control 

The  alternative  network  operator  (ANO)  can  use  its  own  CPE.  The  ANO  has  to  use 
either a CPE which is on a whitelist (published in the reference offer) or a CPE which 
fulfils  minimum  requirements  (also  defined  in  the  reference  offer).  ANO  can  ask  for 
additional CPE to be included in the whitelist.  

In  general  there  are  5  bandwidth  service  profiles  for  the  end-customer  access,  which 
can  be  ordered  by  the  ANO  (see  RO  p.  70,  73,  77).  In  the  future  there  may  also  be 
options for certain intermediate profiles on ANO demand.  

There is no direct DSL profile control offered to the ANO. They can be read only, but not 
changed  because  of  possible  impact  on  other  customers  (and  other  operators). 

256  The S-VLAN identifies the DSLAM and the C-VLAN identifies the logical connection to  the end-user 

within the access area of the DSLAM.  

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Technicalities of VULA products 

According  to  a  BEREC  report257  none  of  the  Layer  2  wholesale  access product  of  10 
EU countries considered enables ANOs such access.  

The maximum symmetric profile is 25 Mbit/s for all NGA network technologies and 50 
Mbit/s  is  possible  on  request  in  case  of  FTTH  (see  RO,  p.  78).  ANOs  request  higher 
bandwidth  also.  There  is  of  course  the  general  option  of  using  leased  lines  for  higher 
bandwidth.   

ANOs  have  several  options  to  prioritise  the  traffic  (different  values  of  the  p  bit)  in  the 
DSLAM  management  (bandwidth  between  DSLAM  and  handover).  They  are  available 
in any case and need not to be ordered by the ANO from A1 TA.  

Security – RTR states that there is security against MAC address duplication (see RO 
p.  64).  All  other  higher  level  (Layer  3  and  above)  security  means  can  be  transported 
through the transparent Ethernet access. 

Fault  management  –  is  supported  by  a  long  list  of  parameters  provided  by  A1  TA 
including  configuration  parameters,  status-, 
test  and  diagnosis  parameters, 
performance data, DSL carrier data and inventory parameter (see RO pp. 79). Access 
is  given  through  a  web-interface.  The  parameters  are  provided  immediately  after 
entering the access line ID. 

For  the  fault  resolution  process,  the  ANO  must  first  locate  the  fault  supported  by  the 
parameters provided. If the ANO identifies the fault at A1 TA, A1 TA will take care of it 
at its own cost. If the ANO cannot locate the fault he can transfer the fault analysis to A1 
TA. If A1 TA discovers that the ANO could have located the fault with the parameters 
provided  the  ANO  is  responsible  for  the  cost,  otherwise  it  is  A1  TA’s  part  to  take  the 
burden of the fault location.  

KPIs  have  been  defined  by  RTR  for  provisioning  and  repair.  They  are  monitored,  but 
the results are only exchanged in confidence between the operators and RTR. They are 
not publicly available.   

There  is  no  compensation  defined  for  not  meeting  the  KPIs  in  the  reference  offer. 
However,  compensations  may  be  part  of  commercially  agreed  contract  and  individual 
SLA. 

Migration 

There  is  a  detailed  migration  process  described  for  the  forced  migration,  with  upfront 
announcement, common bulk migration planning, compensation of stranded investment 
etc.  including  migration  KPI  monitoring.  According  to  RTR,  A1  TA  claims  that  the 

257  BoR (15) 133, Common characteristics of Layer 2 wholesale access products in the European Union, 
http://berec.europa.eu/eng/document_register/subject_matter/berec/reports/5439-berec-

p. 17-18. 
report-on-common-characteristics-of-layer-2-wholesale-access-products-in-the-european-union 

126 

 
                                                 
Technicalities of VULA products 

migration  to  VULA  is  too  slow.  A1  TA  fears  that  end  customers  could  first  nominally 
upgrade the speed on their LLU access lines with the ANO before migration and then 
remain at the old LLU based price (see below).  

When migrating, ANOs prefer to migrate all their customers in a Local Exchange from 
LLU to a virtual access product. They would like to have missing product support for the 
existing POTS and ISDN customers and have requested A1 TA’s support. According to 
a  BEREC  report  the  A1  TA  end  customer  migration  to  VoIP  has  not  led  to  customer 
complaints.  

Price 

Pricing  is  the  most  contentious  topic  regarding  VULA  in  Austria.  VULA  prices  are 
regulated. For forced migration, the access connection to an end customer is priced at 
the  LLU  charge,  until  such  time  as  the  access  speed  the  end-customer  had  before 
migration  is  upgraded.  The  price  is  structured  to  include  one  element  for  the  DSLAM-
port and the subloop and a price for the backhaul from the DSLAM (in the cabinet) and 
the  Local  Exchange,  called  DSLAM  management.  An  example  is:  existing  access 
bandwidth of 8 Mbit/s (at 5.87 € p. month), new access bandwidth 20 Mbit/s (7.26 € plus 
DSLAM management, at 4.40 € 258 p. month). The new A1 TA price for the first part will 
decrease from 7.26 € to 5.45 € p. month, thus even below he old LLU charge.  

When  migrating  to  a  higher  level  handover  (regional/  central)  there  is  another,  higher 
DSLAM management price element. 

Other issues 

There are so far approximately 10,000 end customers connected by VULA. Estimated 
2/3 of these access lines have been migrated through forced migration, approximately 
1/3 has been connected voluntarily. These typically are for business customers. There 
is no significant increase in take up, despite the fact that the VULA product in Austria is 
quite  old  (2010).  This  may  be  due  to  concerns  that  the  price  level  is  prohibitive  and 
suitable  only  for  serving  business  customers.  A1  TA  in  its  new  reference  offer 
announces a new, lower price scheme starting spring 2017, anticipating RTR’s intention 
of a price regulation at a significantly lower level.   

258  €22/5 for the first five customers per DSLAM (€22/n for n>5). 

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Technicalities of VULA products 

Tele2 Austria interview VULA specifications 10 January 2017 

Point of handover 

•  All  four  types  of  handover  are  available  including  at  the  cabinet,  but  it  is  not 
economically  feasible  to  take  VULA  at  the  cabinet  due  to  the  low  number  of 
unbundled customers in relation to number of cabinets. due to the low number of 
customers per cabinet 

•  Handover at MDF is the main product used. This handover site is equivalent to 
that used for LLU. VULA is not yet available at all unbundled sites because the 
NGA roll-out is still partial. 

•  There  is  a  single  handover  (fiber  link)  for  all  technologies  (mainly  FTTC/B). 

VULA specifications for traffic handover do not depend on the technology. 

Generic access 

•  50%  of  the  traffic  is  treated  as  high  priority  with  the  remainder  as  low  priority, 

see A1 TA reference offer. 

•  ANOs  can  choose  1  or  4  VLANs.  This  is  considered  sufficient.  Many  services 

can be managed with one. 

•  The MTU size is state of art. There is always a demand for more, hopefully this 

may be available with the next software upgrade 

•  The service uses double tagging – the second tag is used to identify customers, 
the  first  for  addressing  the  DSLAM.  There  is  no  system  to  match  the  ANO’s 
customer ID to the ID used by the incumbent 

•  Tele2 Austria has no experience with multicast.  

Access seeker’s control 

•  Tele2  Austria  has  freedom  to  use  their  own  CPE  within  compliance  to  VULA 
specifications  for  CPEs  (minimum  requirements)  or  white  listed  modems,  Own 
CPE  may  not  make  sense  for  GPON  where  VULA-technologies  may  not  be 
quite sufficient standardized. 

•  A key concern is that the VULA product offers less flexibility than ULL, because 

the bandwidths are set and priced by the incumbent 

• 

It  is  also  not  possible  to  offer  all  services  virtually  that  are  offered  via  physical 
unbundling – for example there is no solution for POTS/ISDN in the VULA world.  

•  Bandwidths can be increased, but only by ordering through the incumbent.  

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Technicalities of VULA products 

•  Tele2  Austria  receives  status  reports  on  access  lines  including  all  technical 
parameters.  These  are  provided  on  demand,  and  a  bulk  data  file  is  also  sent 
daily. 

•  ANOs  cannot  change  transmission  parameters  –  these  must  be  ordered.  First 
the ANO must make a feasibility check to see what is available – and then they 
can  select  which  technology  and  bandwidth.  Feasibility  checking  can  be 
conducted by using an online tool from TA. 

•  Symmetric bandwidths are available. Demand exists and they are used. 

•  Tele2 Austria conducts its own fault monitoring and reporting. Compensation for 

failure to meet service levels is not automatic. 

Migration 

•  There is forced migration for all services which are not compatible with the NGA 
set-up.  Unshaped  mode  at  FTTC/B  cabinets  for  VDSL  is  becoming  more 
frequent – and this compels migration for ADSL lines 

•  There is a well-established set-up for the regular and forced migration process. 

•  There have also been efforts to create the necessary tools for bulk migration in 
case of forced migrations. The incumbent provides a list of customers affected 
by  its  upgrade  project  and  then  Tele2  runs  the  process  for  migration.  The 
process is automatic, but needs a significant amount of correction. It has been 
operational for 2 years. 

• 

In  the  event  of  forced  migration,  ANOs  continue  to  pay  the  fee  for  physical 
unbundling  but  receive  a  VULA  with  the  same  speed  as  before.  There  is  no 
additional transfer cost, but ANOs need to finance their internal costs – such a 
technical systems and information to the customer. 

Pricing 

•  There is flat pricing for LLU, but VULA pricing depends on bandwidth (separately 
from the customer to the street cabinet and from the street cabinet to handover 
point  –  making  it  more  complex).  There  are  large  charge  increases  between 
bandwidths – making the pricing more comparable with retail minus. 

• 

If  the  fee  were  close  to  the  unbundling  fee,  then  Tele2  would  prefer  a  flat  rate 
configurable  product  –  but  if  the  price  were  set  too  high  for  a  flat-rate  product, 
they could not compete under this model.  

•  The  price  level  makes  it  unattractive  for  ANOs  to  switch  to  VULA  from  LLU 

without end customer demand. 8-16Mbit/s is enough for many customers. 

•  There  is  currently  a  market  analysis  procedure  which  involves  a  review  of 

pricing. Tele2 can provide its responses to the consultations. 

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Technicalities of VULA products 

Denmark 

DBA interview VULA specifications 9 January 2017 

•  The technical specification for VULA was developed in a VULA-forum between 
TDC  and  the  ANOs.  The  Forum  still  exists  and  deals  with  ongoing  questions. 
DBA has an observer role.  

•  The  forum  has  worked  well.  There  have  been  some  minor  challenges  on 
technical and regulatory issues, but these were discussed and largely agreed in 
the  forum.  There  have  been  no  disputes  brought  to  DBA  on  technical  or 
regulatory  issues  during  the  period  after,  but  disputes  on  processes  especially 
on  migration  from  BSA  to  VULA  created  specific  cases.  All  challenges  were 
solved in the forum and DBA has had no need to make decisions. 

•  There will be a Decision from DBA on the WLA and WBA markets (first market 3 
analysis  regarding  the  new  EC  market  recommendation)  to  be  expected  this 
spring.  Not  many  changes  regarding  VULA  are  envisaged  (many  changes  on 
other  subjects  are  expected  –  e.g.  no  access  to  sub  loops,  differentiated  fibre 
obligation and extended obligations on SLA/KPI/SLG). There will continue to be 
an obligation for contended (central market 3b) and uncontended (local market 
3a) VULA products. The Forum will be continued – but not limited to VULA and 
enhanced to other aspects of network access products, eg SLA/KPIs 

•  DBA  has  not  been  closely  involved  in  setting  technical  parameters  as  those 
issues  were  directly  addressed  between  operators  in  the  forum.  Debates  have 
occurred  around  price  and  migration.  DBA’s  previous  market  4  (WPNIA) 
decision  set  high  level  principles,  but  was  not  as  detailed  as  the  WIK 
questionnaire. 

•  As regards migration, practical problems occurred because the process hadn’t 
been  prepared  sufficiently.  System  errors  occurred  because  system  wasn’t 
tested properly. The process was not fast enough. Ordering systems need to be 
in place to be able to make bulk migration. DBA aimed to prevent such problems 
reoccurring  in  the  vectoring  decision  of  2013.  The  vectoring  decision  obliges 
TDC  to  conduct  tests  before  selling  products  –  must  test  routines,  ordering 
systems and processes. Need to give warning before doing the tests, and need 
to  include  ANO  in  tests –  results  must  be presented  in  VULA  forum.  Everyone 
must be happy before vectoring in use. 

•  Contended  VULA  with  a  central  point  of  interconnect  (market  3b)  are 
characterised  by  a  level  of  QoS  limited  by  the  general  Ethernet  transmission 
part. 

•  Uncontended  VULA  is  not  much  used.  The  VULA  specification  started  by 
prioritising  uncontended  VULA  as  this  was  considered  to  be  the  closest 
substitute for physical unbundling. However, it was (before specifying any of the 
products)  concluded  that  it  would  be  much  more  expensive  for  the  ANOs,  so 
attention  switched  to  also  specifying  a  contended  variant  as  that  was  deemed 

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Technicalities of VULA products 

cheaper  and  in  some  cases  more  usable.  The  main  company  that  pressed  for 
uncontended VULA does not exist anymore. The same company was the main 
party requesting Multicast support. 

•  Multicast  functionality  is  also  not  much  used,  but  DBA  considers  that  it  could 
still  be  relevant,  notwithstanding  the  increasing  popularity  of  streaming.  The 
multicast obligation is expected to be maintained in the Spring Decision. 

•  As  regards  Points  of  interconnect,  ANOs  can  ask  for  access  at  DSLAMS 
(2,000-3,000 street cabinets and COs), COs (local exchanges – approx. 1,200) 
or regional access (10-15 points) and central access (in practice 10-15 points). 

•  There  are  two  versions  of  the  uncontended  product  –  one  with  an  interface  at 
back  of  the  DSLAM,  and  the  other  with  dedicated  fibre  backhauling  each 
DSLAM to the CO. This ensures an absence of contention, but makes product 
more  expensive,  because  of  the  number  of  Interfaces  (per  DSLAM)  and  the 
DSLAM backhauling cost. 

•  ANOs  have  significant  opportunity 

for  fault 
management  –  not  sure  how  much  used,  but  TDC  has  offered  a  lot  of 
possibilities. 

to  access  diagnostic 

tools 

•  There  are  KPIs  in  the  Reference  Offer  for  fault  handling,  but  not  for  the 
migration  process.  However,  KPIs  on  migration  are  expected  in  the  new 
decision. 

•  DBA is aware that some ANOs at an early point in the process raised concerns 
about  transparency  (protocol  and  signalling  issues,  including  limitations  on 
which parameters can be transferred). The ANOs expressed concerns that they 
in  specific  cases  might  not  be  able  to  support  advanced  business  services. 
However,  these  concerns  seem  now  to  have  been  dealt  with  and  were  not 
followed up with a reference to the regulator. 

•  There were a number of technical discussions concerning VLANs. However, the 

parties succeeded in finding a solution in forum. 

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Technicalities of VULA products 

Telenor Denmark interview VULA specifications 9 January 2017 

Point of handover and access types 

•  There are several different connection points – (i) POI 3 at centralised exchange 
in 1 or 2 PoPs – cost includes payment for transport, (ii) POI 2 in Ethernet rings 
–  don’t  need  to  pay  for  IP  core  transport.  Telenor  has  63  POIs  to  cover  whole 
territory. 1 POI2 in each Ethernet ring each serving 80,000 customers (iii) POI 1 
local at central office – building where multiple nodes – around 1,500 – similar to 
LLU. (iv) POI 0 at node level (SLU). 

•  POI 3 easiest – but too high cost. POI 1 vs POI 2 little discount – saving too low. 
Would need to rent or buy many fibre connections for POI 1 – uneconomic also 
taking into account Telenor’s market share of 6-7% of the broadband market. 

•  Telenor  has  upgraded  40-50%  sites  (POI  2)  to  10G  backhaul  –  previously 
capacity was a constraint – they foresee that in a few years upgrades to 100G 
may be needed for many of these points. 

•  DSL  and  fibre  VULA  are  similar  technically  and  in  price.  There  is  no  VULA  on 

coax 

•  The  VULA  product  is  based  on  Alcatel  ISAM-DSLAM  equipment  –  GPON  and 
VDSL are terminated on the same node. Interchange is trivial (at least for POI2 
– see above).  

Generic access 

•  Telenor is not buying uncontended VULA, which is handed over at POI 0 and 1 
per  DSLAM.  Dealing  with  such  number  of  interfaces  and  backhauls  is  too 
complex and expensive for Telenor, despite the fact that the uncontended VULA 
offers more flexibility over the product definition than the contended version. 

•  Telenor could in theory use VULA uncontended in many places. However, there 
is a complexity to reach each DSLAM, and they may need to pay for backhaul 
for 2 DSLAMs with only few customers, because they cannot determine DSLAM 
customer aggregation. Fibre ODFs and patch cords must also be ordered from 
TDC  and  are  costly.  They  would  need  to  introduce  logic  to  analyse  at  which 
sites uncontended and at which sites contended VULA should be ordered. This 
would  create  excessive  complexity  for  provisioning  and  OSS  systems.  POI  0 
specification is considered to be driven by the incumbent – which appears not to 
be  interested  in  selling  or  marketing  this  product.  Others  are  looking  into 
uncontended  VULA,  but  not  using  it,  to  Telenor’s  knowledge.  The  contended 
product  offers  a  transparent  connection  to  the  end-user  and  is  acceptable  for 
Telenor,  since  it  is  comparable  to  TDC’s  own  products  sold  on  the  retail  level. 
However, Telenor would need uncontended if they used multicast. 

•  Backhaul  capacity  is  not  an  issue  –  they  can  monitor  and  upgrade  their  own 
network/  handover  points  if  needed.  Telenor  has  not  experienced  issues  with 

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Technicalities of VULA products 

excess contention in the TDC network, but TDC has a direct interest in avoiding 
contention as it would also affect them in their Ethernet aggregation rings. 

•  Telenor  is  using  2  VLANs  per  customer  –  one  for  data  and  the  other  for  voice 
(QoS guaranteed, EF: Expedited Forwarding). This works well. This splitting into 
two VLANs causes extra cost for voice so it is only offered for customers taking 
voice.  Voice  over  WiFi  is  a  new  Telenor  product  under  consideration  –  this 
results in new requirements for WiFi coverage in home. There may be demand 
for  another  VLAN 
to  guarantee  VoWiFi  quality.  Still  under  discussion. 
Challenging to have guaranteed QoS when streaming is used. 

•  Double VLAN tagged at POI. Dedicated logical connection per customer defined 
by VLAN tagging. Option to buy QoS as add-on. One can buy separate VLANs 
with QoS. 

•  Regarding  end  customer  addressing  Telenor  is  responsible  for  matching 

customer ID with TDC ID. 

•  Multicast is priced separately and was too expensive when Telenor investigated 
it some years ago, so they decided not to offer IPTV. According to the media, in 
any  event  many  people  are  moving  to  unicast-based  streaming,  and  this  is 
reflected  in  traffic  trends  –  40-50%  peering  traffic  Netflix.  Telenor  is  therefore 
putting effort into building CDNs – moving content closer to the end customers. 
Another argument is the end customers’ demand of using the same products in 
fixed  and  mobile  networks.  IP-TV  is  not  operating  well  in  mobile  networks,  but 
unicast streaming can be supported. 

•  There is a difference in the MTU for BSA (1500) and VULA (1600). The VULA 
MTU  is  sufficient  while  the  BSA  is  insufficient.  However,  to  avoid  complexity 
amongst  the  products,  Telenor  sets  the  parameters  on  the  basis  of  the  lowest 
common denominator (BSA) – 1492 bytes (8 Bytes used for the PPP-tunneling 
of Telenor). This low MTU causes some problems with older equipment, but not 
with more modern products. 

Access seeker’s control 

•  There  is  free  choice  of  equipment,  but  new  equipment  needs  to  be  tested  for 
interoperability  (before  being  white  listed).  Telenor  supplies  its  own  CPEs  with 
the Telenor brand. (One could also use TDC’s CPE.) 

•  There  are  different  VULA  bandwidth  classes  ranging  from  125Kbit/s  to  150 
Mbit/s. A new change order is needed to change bandwidth, and changes incur 
cost. Access seekers can buy QoS add-ons eg Expedited Forwarding for VoIP, 
but this cannot be changed by the ANO directly during operation – needs to be 
ordered 

•  There exist expedited forwarded (QoS) and symmetric service options (although 
the  price  for  the  latter  is  set  on  the  basis  of  the  downlink  bandwidth,  so 
symmetric and asymmetric services cost the same). Many  business customers 

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Technicalities of VULA products 

ask for symmetric bandwidths – but Telenor does not offer because the volumes 
are too low. TDC is working on unified interface, that may make it more viable.  

•  There is no dedicated security supporting mechanisms. Telenor relies on PPP. 

•  TDC  has  introduced  Alcatel  product  Network  Analyser  with  dynamic  line 
management,  which  allows  ANOs  to  monitor  their  access  lines  –  majority  of 
lines  enabled,  but  in  process  of  being  implemented.  ANO  can  look  at  the  line 
state  and  gets  just  in  time  report.  Access  to  diagnostic  data  is  also  enabled. 
ANO  cannot  change  the  line  ports  characteristics.  This  has  been  discussed  in 
the forum, but TDC remains in control of this. Instead TDC uses an Auto-Tuning 
facility of Alcatel Lucent.  

•  There  is  no  clear  definition  of  line  faults  –  these  are  addressed  case  by  case. 
There  are  often  problems  reported  with  unstable  lines  –  there  is  a  problem  of 
proving where the problem lies – it is a blame game. Results in replacing many 
gateways unnecessarily -and to Telenor’s knowledge there is no compensation. 

• 

 There are SLAs and KPI’s. 80 % of registered faults must be dealt with before 
60 hours (24/7), and 95% before 84 hours 

Migration 

•  55-60%  of  Telenor  BB  lines  on  own  (LLU)  infrastructure  –  rest  moved  to 

VULA/BSA. 

•  No forced migration – spectrum shaping used to avoid interference with copper 

unbundling lines. 

•  Vectoring  moving  fast  –  majority  of  last  nodes  vectored.  When  vectoring 
implemented,  forced  to  migrate  to  forward  access  point.  6  or  9  months  prior 
notice given. Need to provide vectoring enabled CPE – and then notice is given 
that the line has been moved. Compensation for the stranded investment is not 
explicitly granted, but is reflected in VULA pricing. Now there is the same price 
for VULA as BSA. Originally there was a difference (VULA < BSA). 

•  There are a status reports and presentations on migration, but there is no formal 

KPI reporting. 

Price 

•  The  prices  for  contended  VULA  are  based  on  download  speed  –  with  €12 

difference between 2 and 50 Mbit/s. 

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Technicalities of VULA products 

•  Average 

prices 

for 

2017: 

(https://erhvervsstyrelsen.dk/sites/default/files/media/prisafgoerelse_lraic-
fastnet_2017.pdf ) 

2017

Average Monthly recurring 
(DKK)

One-off charge 
(DKK)

Average monthly fee w/one 
off distributed (36 months) 

LLU
VULA/BSA POI I
VULA/BSA POI II

Incl bearer line (DKK 
340/year)

57,8
68,8
73,6

650
700
700

75,9
88,2
93,0

•  Retail  prices  are  decreasing  –  and  bandwidth  is  increasing,  due  to  streaming 
amongst  other  factors.  The  wholesale  price  decreases  are  not  matching  retail 
price  decreases.  10G  handover  ports  are  needed  and  volumes  are  doubling. 
Thus  it  becomes  significantly  harder  to  make  a  business  case  work  when  the 
VULA pricing is based on bandwidth. It would be more effective if there were a  
flat rate port price – like for the uncontended VULA. It is hard to have  variable 
line prices – especially on fibre. 

Other 

•  Fibre coverage by TDC is not high – technical limits on GPON technology with 
its  2,5  Gbit/s  down-  and  1,25  Gbit/s  upstream  –  shared  between  up  to  64 
subscribers. Subscribers disappointed to only get 100/150 and not Gigabit, but 
cannot  get  guaranteed  Gigabit  speeds  on  VULA  platform  –  due  to  shared 
bandwidth.  TDC  says  the  next  GPON  generations  TWMPON  and  XGPON  are 
too expensive and they have no plans to upgrade – triggered debates in forum. 
So there is no option realising a 1 G product based on uncontended VULA.  

•  TDC bought and migrated the P2P DONG network, which was fibre unbundable, 

to GPON. 

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Germany 

BNetzA interview VULA specifications 10 January 2017 

Regulatory regime regarding L2 access in Germany 

•  There are three layer 2 (L2) wholesale access products to be regulated: 

1.  KVZ-AP:  Substitute  for  the  unbundled  subloop  at  cabinet  outside  the 
near  shore  MDF  area  (Nahbereich,  550  m  around  the  MDF),  if  the 
cabinet has been accessed by the wholesale seeker already, who now is 
pushed out, Vectoring I decision 

2.  KVz-AP-N:  Substitute  for  the  unbundled  subloop  at  cabinet  inside  the 
near  shore  area,  independent  of  the  cabinet  being  accessed  before  by 
the wholesale seeker, Vectoring II decision (ongoing regulatory process) 

3.  L2 bitstream with BNG handover  

•  The  first  product  is  already  regulated,  the  second  is  in  the  regulatory  process. 
These  are  the  only  two  VULA  products  for  Germany.  They  substitute  the 
subloop  unbundling,  thus  have  a  handover  at  the  cabinet  location.  This  is  the 
only local handover foreseen in Germany (in market 3a)  

•  The third product is a L2 bitstream with regional access/ handover at the BNGs 
(899  locations  of  appr.  8,000  MDF  locations).  DT  positions  this  product  as  an 
alternative to the local loop/ subloop unbundling, but BNetzA qualifies it as part 
of market 3b, so not as a VULA (will be checked in future). 

•  The second product is restricted to the near shore area (Nahbereich) and by this 
no subject of state aid, thus no subject of the DG Comp state aid considerations. 
This is because for all near shore areas there exist NGA roll out commitments, 
either by DT or ANO. These areas by definition cannot be subject for broadband 
roll  out  supported  by  state  aid.  (See  also  statement  of  BMVI  directed  to  DG 
Comp.)   

•  The frequency regulation allows the use of the frequency range below and equal 
2.2MHz  to  all  operators.  Up  to  this  frequencies  the  LLU  and  SLU  is  not 
restricted. This regulation has not been changed. It is an abstract pre-regulation 
which has no legal link to the vectoring regulation.  

Point of local Handover (considered for the only state aid relevant first product KVz-
AP) 

•  Withdrawing the right for SLU just requires substituting the SLU product, at the 
same  handover  point.  There  is  no  justification  for  demanding  an  MDF  or  even 
higher level handover in VULA quality. The local handover condition is met. 

•  There is a handover per DSLAM.  

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Technicalities of VULA products 

•  There only is one handover point for one ANO per DSLAM (in case of KVz-AP, 
when a competitor has been pushed out of a cabinet (see 1. above). In state aid 
areas the number of ANO is not limited. 

•  This regulation only is for FTTC with VDSL Vectoring.  

Generic access (KVz-AP) 

•  The handover point per DSLAM in any case does not have a contention, unless 
the  bandwidth  demand  of  the  wholesale  seekers  end  customers  at  the  busy 
hour  exceeds  the  handover  port  capacity.  With  1  Gbit/s  interfaces  this  will 
typically  not  occur.  Thus  all  traffic  is  uncontended.  At  least  it  is  comparable  to 
the situation of SLU, which also requires an ANO to deploy a multiplexer with a 
Backhaul interface of fixed bandwidth. Additional or larger bandwidth handover 
interfaces may overcome a scarce capacity problem. There is an upgrade option 
to  a  10Gbit/s  handover  interface.  This  interface  can  be  demanded  by  the 
wholesale seeker too. 

• 

It fulfils all requirements for a generic and transparent access.  

•  Multicast  functionality  (frame  replication)  is  not  required  or  demanded  at  this 
low  network  level  with  only  a  few  ANO  customers,  thus  there  is  no  demand 
specifying such characteristic in the VULA definition. In addition the demand for 
synchronously transmitted TV-services is decreasing, instead the importance of 
Media-center services and Netflix like services increases significantly. The more 
different  access  seekers  want  to  access  an  MSAN,  the  less  IP-TV  users  per 
handover point (per ANO) will exist, the less importance Multicast support has.  

Access seekers control (KVz-AP) 

•  Comprehensive  control  of  the  service  quality  is  of  high  relevance  for  the 

wholesale seekers. 

•  According  to  the  Fee  Router  Choice  Law  (FTEG  §  11  (3),  2016)  the  end 

customer is free to choose its CPE. 

• 

In  the  German  VULA  model  the  VULA  access  speed  is  not  capped  by  the 
wholesale  provider  but  is  the  capacity  being  determined  by  the  transmission 
technology and the physical limitations of the copper lines. 

•  The  access  seeker  is  free  to  determine  the  end  customers’  capacity  inside  the 

given (highest possible) bandwidth threshold.  

•  Traffic  prioritisation  and  security  are  determined  by  the  ANO  on  the  backhaul 

link or BRAS level.  

•  BNetzA  prefers  not  to  regulate  fault  definitions  because  of  the  wide  range  of 

fault reasons. 

•  There is a regulated service level, which is be secured by compensations. 

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Technicalities of VULA products 

•  There  is  no  KPI  monitoring  with  related  compensations.  In  case  of  pushing  a 
competitor  out  of  a  cabinet  because  of  Vectoring  deployment  a  statistical  KPI 
approach does not makes sense because of the low number of cases and lines. 
Also a relatively low number of lines is expected in case of providing a VULA at 
cabinet in state aid areas.  One has to take into account that defining KPI and 
statistical parameters require a larger number/ set of cases respectively lines – 
so for small operators and a few lines it will not make sense. This even more is 
true for the near shore areas. 

Migration 

•  There  exist  automatic  process  interfaces  for  order  processing  between  ANOs 

and incumbent. 

•  There  is  a  “bulk”  migration  process  fixed  in  the  VULA  regulation  in  case  of 
enforced  migration  because  of  pushing  a  competitor  out  of  a  cabinet  (  some 
cabinets), but this in total only are a few lines. 

•  There is a kind of compensation for frustrated investment regulated for the KVz-
AP in case of pushing a competitor out of a cabinet by offering reduced prices 
for  the  enforced  migrated  lines  (as-if  cost).  There  is  another  compensation  for 
the KVz-AB-N product (near shore/ Nahbereich). In case of state aid there is no 
relevance for compensation of frustrated investment because all lines connected 
to a VULA-AP are new or bandwidth upgraded lines. 

Price 

•  The product-cost are relevant for determining the VULA price in case of state aid 
and  in  other  KVz-AP  product  applications,  except  the  case  with  an  access 
seeker  being  pushed  out  of  a  cabinet,  there  an  as-if  cost  approach  has  to  be 
applied. 

• 

If the price model for VULA shall be comparable to the LLU pricing scheme the 
wholesale  seeker  has  to  share  the  utilisation  risk  for  the  cabinet  deployment. 
This could be achieved by dividing the cost into two parts. The wholesale seeker 
pays  for  the  cabinet  deployment  a  shared  flat  fee  plus  a  fee  per  subloop  used 
(per subscriber). 

Other 

•  BNetzA did not check the VULA products submitted by BMVI in detail, especially 
not in a manner as done for the regulated products described in the incumbent’s 
reference offers. 

•  BNetzA  provides  a  paper  describing  its  position  on  VULA  in  case  of  state  aid, 

answering the questions of WIK’s mail (16th Dec. 2016).  

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Technicalities of VULA products 

United Kingdom 

Ofcom interview VULA specifications 21 December 2016 

Local access 

There  is  no  point  of  handover  at  the  cabinet.  Handover  is  at  a  subset  of  exchanges 
(approximately  900  out  of  5,500).  This  level  of  interconnect  is  still  considered  ‘local’. 
The reduced interconnect points are explained by the fact that fibre has a longer range 
than  copper,  and  the  industry  finds  it  more  cost-effective  to  interconnect  from  fewer 
exchanges  than  was  the  case  for  copper  unbundling.  These  handover  points  can  be 
reached by most ANOs, and the location of interconnect is generally accepted. 

As regards the reach of the VULA product – it is currently available to around 95% of 
households.  The  coverage  of  FTTC/FTTP  VULA  is  expanding  as  cabinets  are 
upgraded, but this is unlikely to affect the number of handover points significantly.   

A single product (Generic Ethernet Access) is offered regardless of technology (FTTC 
or  FTTP).  The  VULA  product  has  the  same  specification,  but  FTTP  offers  greater 
bandwidth capabilities. The handover points are common to both technologies. 

Generic access 

BT  has  published  technical  VULA  specifications  in  supplier  information  notes.  The 
characteristics were agreed in an industry-wide technical committee (NICC).  

A  number  of  profiles  are  offered  within  which  maximum  peak  and  prioritised 
downstream and upstream bitrates are specified. The FTTP solution has a superset of 
profiles, while FTTC has subset.  

VULA products are contended, but within each profile, there is a prioritised bandwidth 
which  is  effectively  uncontended.  For  example  the  40/10Mbit/s  FTTC  VULA  product 
incorporates  15Mbit/s  down  and  10Mbit/s  upstream  prioritised  bandwidth.  For  the 
80Mbit/s  VDSL  VULA  product,  30Mbit/s  downstream  is  prioritised  and  20Mbit/s 
upstream. 

VULA  is  a  mass-market  product.  No  symmetrical  profiles  are  specified.  Symmetric 
bandwidths at speeds of 100Mbit/s+ are normally provided using dedicated fibre leased 
lines.  However,  some  operators  may  offer  ‘symmetric’  products  to  businesses  on  the 
basis of VULA by highlighting the prioritised downstream and upstream rates eg 20/20. 

Vectoring  is  not  widely  deployed  in  UK.  G.fast  is  being  trialled,  but  is  not  yet 
commercially offered. 

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Technicalities of VULA products 

As regards other technical characteristics: 

•  There is a maximum MTU of 1534 bytes 

•  VLAN per operator and two layer tagging is supported 

•  There is customer identification for each network operator and customer – so 

should be one to one 

•  Multicast frame replication is supported 

Ofcom is not aware of complaints regarding these characteristics. 

Access seekers’ control 

The CPE is determined by ANO. Openreach can supply the modem, but most operators 
do  not  take  that  route.  CPE  must  conform  to  specifications  published  by  Openreach. 
There was debate on this issue some time ago – but it now concluded. 

Self-supply by the end-user is theoretically possible, but ANOs discourage self-supply, 
for example by limiting guarantees for fault repair. Manufacturers can gain accreditation 
for  CPEs  –  but  an  ANO  must  present  the  request  to  testing  house  on  behalf  of 
manufacturer. There is no significant interest from end-users in self-supplying modems. 

Operators can select amongst a number of bandwidth profiles or if the desired features 
are  not  available,  they  may  request  Openreach  to  develop  new  profiles.  Two  new 
profiles were recently released in response to request. 

Central  management  of  profiles  by  Openreach  is  needed  because  there  is  a  common 
backhaul connection to the local exchange. Development and release of new profiles is 
enabled  by  a  regulated  development  process.  However,  there  has  been  debate 
concerning the price. Ofcom is currently reviewing whether to impose a charge control 
on VULA. At the moment there is no charge control – only a margin squeeze test. 

There  are  no  options  for  ANOs  to  control  DSL  profiles  other  than  by  selection  of  the 
profiles offered by Openreach. Dynamic line management is supported. 

CP  can  made  trade-off  between  headline  speed  and  line  stability  –  three  options.  Do 
they prioritise speed or QoS in marketing – dynamic line management enables to make 
these  choices.  Theoretically  possible  for  operator  to  change  them  –  but  Openreach 
discourages that. 

Security  –  Marketing  material  says  GEA  product  set  confirms  to  Govt  IL2  security 
standard (publicly available). 

Fault  management  –  fault  reported  by  end-user  –  no  pro-active  reporting  from 
Openreach  to  CP.  Openreach  will  not  necessarily  inform  CP  if  becomes  aware  of 

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Technicalities of VULA products 

problem  –  some  redundancy  allows  switch-over.  Otherwise  for  CP  to  pass  to 
Openreach fault raised by customer. 

All  of  the  data  on  the  service  layer  held  by  Openreach  –  trialling  data  sharing  to 
operators  when  fault  is  received.  Timing  issue  –  may  be  15  mins  to  1  day  in  arrears. 
Openreach  conducts  service  layer  test.  Depends  also  on  operators  ability  to  receive 
data. 

Substantial  debate  about  what  is  a  fault  –  mainly  on  ADSL,  rather  than  VDSL.  No 
exchange-based VDSL in UK. FTTP fault rates are lower. 

SLA,  KPI,  and  SLG  requirements.  Service  management  level  2  for  FTTC/P.  Fault 
repaired  by  end  of  next  working  day  –  otherwise  payments  to  CP.  KPIs  reported  in 
private. Not required to publish, but shared with industry (in confidence) in various fora. 
Openreach website shows published KPIs (copper loop KPIs). 

Migration 

CP-led  commercial  decision,  so  compensation  not  relevant.  Openreach  does  not 
undertake any mass-migration. Stranded investment discussion different from Germany 
– no exchange-based VDSL. Very little deployment of alternative VDSL infrastructure. 

Price 

VULA  prices  currently  unregulated.  Upcoming  review  of  WLA  –  considering  pricing 
issues. VULA products overlay LLU or WLR. 

Other issues 

Public  debate  on  universal  broadband  –  minimum  10Mbit/s  should  be  available. 
Consider this appropriate for consumer needs today, and VDSL sufficient to meet need. 
But  also  stated  publicly  that  future  is  at  speed  and  service  characteristics  closer  to 
FTTP. See bandwidth needs increasing over time. UK Govt notified state aid case – no 
more stringent VULA requirements placed. 

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Talk Talk interview VULA specifications 10 January 2017 

General points 

•  Openreach’s VULA (GEA) product is a managed data only service. This means 
it is not comparable to MPF (Metallic Path Facility, LLU). It is virtual unbundling.  

Handover points 

•  Talk  Talk  interconnects  into  Openreach’s  GEA  service  at  the  exchange  using 

the OR Cablelink product. 

•  TalkTalk  is  deeply  interconnected  into  the  BT  network  of  exchanges.  The 
handover  points  for  VULA  (including  the  parent  child  arrangement)  are 
acceptable. There is nothing restrictive in the way in which Openreach has set it 
up. It is possible to link to any site using backhaul (Cablelink) if needed.  

•  Talk Talk does not use the FTTP VULA product. They consider that prices were 

set at an excessive level by BT so as not to cannibalise Ethernet. 

Generic access 

•  Currently Talk Talk does not experience any problems with contention in the BT 
network – theoretically it could occur in the Access network. To date Talk Talk 
has not experienced switch contention in the exchange. 

•  As regards contention in the Talk Talk service, Talk Talk can order more cable 

links to control its own contention.  

•  TalkTalk has no issue with the MTU size. 

•  Talk Talk uses VLAN double tagging. 

•  Talk Talk uses the multicast function to support its IPTV service and is broadly 
satisfied  with  its  functionality.  Talk  Talk  uses multicast  for  a  subset  rather  than 
for all IPTV channels, as a certain scale is needed to make it viable. 

Access seekers’ control 

•  ANOs can choose which CPE to deploy. However, there are criteria Openreach 
has  published  that  to  which  devices  must  conform.  Additionally,  new  devices 
which have not yet been accepted by Openreach must be tested and approved 
in the BT labs to ensure they  meet the criteria before deployment. There have 
been  some  issues  over  timing  of  approval,  but  these  can  be  escalated  and 
resolved. 

•  Talk  Talk  can  choose  from  different  speed  tiers.  Openreach  currently  offers 
options of: 40/2 Mbps down and up-stream; 40/10; 55/10; 80/20. There is also a 
trial  for  a  new  proposed  18/2  Mbps  tier.  However,  the  maximum  speed  an 
access line could transmit is capped by BT, and the pricing for different tiers is 

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Technicalities of VULA products 

set by BT. Talk Talk would prefer a single uncapped VULA product, leaving it for 
the ANO to decide how to use it, at its maximum capacity or below for a fixed, 
bandwidth  independent  price.  For  example,  ANOs  adopted  a  strategy  with 
ADSL2+ of offering the fastest possible speeds. However, BT’s tiering approach 
has left pricing so high for higher speeds that it is choking demand. 

•  Talk  Talk’s  Consumer  division  does  not  currently  offer  or  demand  symmetric 

bandwidths. 

•  ANOs can prioritise traffic for time-critical services such as VoIP. There are no 
known concerns around QoS classes. Openreach is planning to introduce a new 
class of QoS that will be voice specific 

•  Talk Talk utilise Openreach’s diagnostics to identify faults and can then choose 
whether  to  resolve  them  either  in  the  home  or  via  an  Openreach  engineering 
visit .  

•  There  are  some  concerns  over  the  way  in  which  faults  are  handled.  For 
example,  Openreach  and  TalkTalk  may  agree  there  is  a  broadband  fault,  but 
Talk Talk is sometimes expected to pay for repairs even though the network is at 
fault. Openreach will not pro-actively repair broadband faults – only voice faults. 
However, in practice Talk Talk experiences more problems with LLU (MPF) than 
with VULA. 

•  There  are  service  management  (care)  levels  for  VULA  detailed  in  the  product 
description. ANOs receive individual reports, and automatic compensation if the 
service does not meet the standard. Various performance statistics are reviewed 
at  the  industry  fora  led  by  the  Office  of  the  Telecom  Adjudicator  (OTA)  and 
bilateral view meetings take place between Talk Talk and Openreach. 

Migration 

•  There are migration options to and from other services. It is worth noting that in 
the Openreach model an ANO must purchase an underlying copper product for 
delivery of the GEA service, e.g. WLR or MPF. 

•  There  are  bulk  migration  processes  for  moving  between  different  bandwidth 
levels  or  service  management  levels.  However,  the  migration  from  ADSL  to 
VDSL is done on individual basis. There is no facility for a mass upgrade but in 
the  past  Openreach  has  worked  with  CPs  on  a  project  basis  for  large  scale 
upgrades. 

•  Forced migration was not an issue in the past. However, BT is about to trial long 
reach VDSL, which would impair the ADSL service and therefore compel ANOs 
to  upgrade.  There  is  also  an  ongoing  case  of  an  exchange  closure  in  London, 
which would require an access product upgrade because the lines from the new 
exchange  location  would  be  too  long  to  support  ADSL.  There  have  been 
discussions  in  the  industry  working  group  about  who  should  pay  for  the 
upgrades.  Openreach  has  offered  to  meet  CPs’  costs  in  the  case  of  Chelsea 
exchanges  and  made  special  offers  for  VULA  in  the  case  of  the  long  reach 

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Technicalities of VULA products 

VDSL  trial.  However,  the  offer  is  time-limited  for  2  years  and  there  is  no 
commitment to continue after that.  

• 

In general, Talk Talk would be compensated for exchanging kit if this is required 
as a result of Openreach activities. 

Pricing 

•  A  new  charge  control  is  due  1  April  this  year  for  fixed  line  products.  However, 
Ofcom  has  not  yet  published  its  first  consultation  on  which  products  would  be 
caught by the charge control (VULA is not currently charge controlled) and what 
prices  would  be  set.  This  consultation  is  expected  at  the  end  of  March,  which 
means that the process is around 1 year behind. 

•  Margin squeeze tests exist. However, the details and results are not published. 
Ofcom  only  indicates  whether  or  not  the  test  has  been  passed,  making  its 
impact opaque.  

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International operator 

Vodafone interview VULA specifications 22 December 2016 

Vodafone’s preference is to invest or co-invest in VHC infrastructure through acquisition 
or  the  use  of  duct  and  pole  access.  However,  Vodafone  is  a  user  or  potential  user  of 
VULA products in markets and regions where infrastructure investment is not possible 
or is economically unviable. The interview covered Vodafone’s perceptions concerning 
the proposed DT VULA specifications and the VULA specification of BT Openreach. 

DT proposed VULA specification 

Local access 

DT’s  proposal  to  offer  VULA  at  cabinet  level  presents  a  problem.  Due  to  the  large 
number  of  handover  points  involved,  Vodafone  does  not  consider  that  there  will  be 
demand  for  this  product.  The  number  of  customers  accessible  at  the  street  cabinet  is 
too  low  to  permit  viable  access.  This  holds  even  when  making  use  of  the  regulated 
wholesale duct offer between cabinet and Local Exchange.  

A  further  concern  is  that  it  is  not  acceptable  in  principle  to  offer  access  to  a  VULA 
product  limited  to  one  ANO  per  location,  even  if  there  would  be  no  demand  due  to 
limited viability. 

VF  considers  it  acceptable  to  pick  up  VULA  at  the  more  limited  number  of  BNGs. 
However,  it  is  important  that  this  handover  option  provides  adequate  VULA-like 
technical specifications, which is not the case at the moment. 

VF prefers not to have different handover points for different access technologies. This 
avoids  the  need  to  build  multiple  interconnecting  infrastructures.  They  expect  one 
product  with  uniform  specifications,  independent  from  the  access  technology,  but  with 
variations regarding bandwidth, latency and upstream vs downstream speed asymmetry 
according to the technologies’ capabilities. 

The main concern for the cabinet VULA is the 1G port capacity limitation at the MSAN. 
Backhaul does not present issues because this would be supplied by the ANO  (through 
duct access or dark fibre for limited time), though costs for both these methods needs to 
be factored against the number of customers off the cabinet and likely take-uprate.  

Generic access 

For the BNG handover – VF considers as an important requirement that DT would need 
to  expand  the  transport  (backhaul)  capacity  in  case  of  contention.  1G  handover 
interfaces  are  insufficient  and  should  be  added  by  10  G  interfaces.  The  number  of 
VLAN  per  end  customer  should  be  increased  from  3  to  4.  MTU  size  should  also  be 

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increased for BNG, as additional tagging necessary to support development of products 
for carrier/enterprise markets. MTU should be at least 1580 as in Austria for additional 
tagging. There was a requirement by the NRA for DT to present a time schedule for the 
improvement of the MTU – but the issues are still under discussion. 

Another problem is that DT did not follow NGA forum specifications regarding the need 
for a logical connection per end-customer. 

As  regards  multicast,  frame  replication  was  demanded  by  ANOs,  but  DT  is  only 
providing 1 to 1 uni-cast support. According to VF this issue is not relevant for VULA at 
the street cabinet, but is relevant for BNG handover. 

Access seeker’s control 

The  CPE  specification  is  considered  acceptable,  but  VF  is  concerned  that  the 
specification is fully under the control of DT, which risks unexpected changes and the 
potential for discrimination. 

There is insufficient access to diagnostic data for fault management to enable to track 
and influence fault management, without relying on DT. 

The  mean  time  to  repair  is  not  defined.  There  is  a  definition  of  the  maximum  fault 
duration time, but penalties for failing to repair in due time are not specified, providing 
insufficient incentives for DT to complete the repair. No fault KPI are defined either, thus 
there is also a lack of compensation for damages for failing to meet the KPIs.  

Migration 

There  are  no  specific  processes  for  migration  to  VULA  from  LLU.  On  the  other  hand 
there  is  an  ongoing  discussion  concerning  migration  for  nearshore  areas  (vectoring) 
contracts.  Some  parts  of  the  migration  proposals  could  be  improved,  others  are 
acceptable.  VF  will  provide  further  details  from  their  comments  in  the  German  public 
consultation process and from the BEREC L2 consultation. Key for effective migration is 
engagement with DT – regulation may not solve all aspects.  

Price 

BNetzA has published final BNG prices – but not VULA cabinet prices. For VF, pricing 
is the next question to be address after product specification, and the specification for 
cabinet VULA has not yet been finalised. 

Informally  [not  for  publication],  VF  indicates  that  additional  aspects  for  cabinet  VULA 
(above SLU) should not cost more than €3. 

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UK VULA product specification (GEA) 

VF indicated that they had developed a best practice guide for submission to BEREC in 
the  context  of  its  assessment  of  layer  2  bitstream.  VF  considers  that  while  no  VULA 
specification is ideal, the UK offers a reasonably good benchmark.   

main 
URL: 
http://berec.europa.eu/eng/document_register/subject_matter/berec/download/0/5383-
vodafone8217s-response-to-the-berec-publ_0.pdf 

response 

URL:  Annex  describes  Vodafone’s  requirements  for  a  Layer  2  (Ethernet)  Wholesale 
Access  Product  (L2  WAP)  that  is  fit  for  purpose  for  offering  competitive  and 
differentiated  retail  services.  It  summarises  the  key  L2  WAP  functionalities  necessary. 
http://berec.europa.eu/eng/document_register/subject_matter/berec/download/1/5383-
vodafone8217s-response-to-the-berec-publ_1.pdf 

Positive points: 

•  Physical  infrastructure  and  architecture  positive  –  no  handover  at  5,500 
exchanges  (like  LLU)  but  rather  984  –  parent/children  exchanges  –  similar  to 
BNG. Changes could be made more easily at BNG level than at each cabinet. 

•  Single  chassis  in  head-end  site  handles  a  set  of  local  exchange  cabinets  for 
FTTC,  and  PONs  for  FTTP.  Larger  catchment  areas  than  one  chassis  can 
support  will  split  the  child  local  exchanges  into  groups,  one  group  on  its  own 
chassis at the head-end. 10Gb interface being worked on.  

147 

 
Technicalities of VULA products 

Figure 0-1: Single NGA handover point for different access technologies 

Source: Openreach, UK NICC Open Forum 2013 
http://www.niccstandards.org.uk/meetings/2013georgewilliamson.pdf?type=pdf 

Acronyms in Figure 0-1: 
BBR -  

Broadband Repeater technology used to extend reach of Broadband on copper USC - Universal 
Service Commitment 
Comms Provider 
Local Loop Unbundling 

CP -  
LLU -  
MDF -   Main Distribution Frame 
Primary Connection Point 
PCP -  
OHP -  
Openreach Handover Point 
WLR3 -   Wholesale Line Rental (3rd generation) voice product access  

Capability  to  handle  G.fast  connections  also  –  so  one  handover  for  all 
technologies,  as  illustrated  above  –  as  BT  add  new  methods  e.g.  Wireless 
backhaul  to  remote  FTTC  Cabinets,  G.fast  etc,  only  need  to  be  in  the  NGA 
Handover Point. 

•  Need  to  connect  to  each  chassis  with  own  capacity  –  use  native  capability  of 
head-end  equipment.  Easier  to  change  services  and  manage  congestion.  No 
negative  impact  regarding  congestion  at  an  additional  aggregation  level 
determined by the incumbent.  

•  Business  to  business  gateway  relatively  positive  –  automatic  payment  for  late 

delivery. Platform should be able to add on G.fast speeds with ease.  

•  Pricing – one-off cost for connection at head-end. No usage charges there, but 
rather price at end-user connections for profile of traffic eg 38 or 76Mbit/s. This 

148 

 
 
 
Technicalities of VULA products 

solution  provides  a  well-defined  cost-base,  regardless  of  profile  used.  Different 
from Germany where the set-up is closer to bitstream. 

Negative points 

•  Limited  QoS  levels.  Ability  to  influence  product  development  limited  (mobile 
needs  low  latency  and  a  synchronisation  network  clock,  but  BT  refused  to 
change  to  accommodate).  Statement  of  requirements  process  theoretically 
allows ANOs to request alternative specifications, but no guarantee that BT will 
develop on the basis of an SoR. The Equivalence of Access office is looking into 
effectiveness of SoR process 

•  VLAN  structure  available  to  residential  customers  is  problematic  –  one  for 
multicast, one for voice (limited), and one for data – insufficient. Need minimum 
of 4. 

•  MTU size of 1534 should be increased to at least 1580 Bytes. 

•  Size  of  pipes  –  only  1G  interface  possible.  Once  connections  are  offered 
>100Mbit/s,  limits  service  quality.  10G  option  should  be  made  available  more 
quickly 

•  Mapping of prioritisation – traffic is mapped to drop/do not drop queue – difficult 
to  use  for  SME  eg  for  video-conferencing.  No  congestion  management/QoS 
targets. 

Other points: 

•  UK  product  longer  on  market,  so  most  deficiencies  now  addressed  eg 

automation 

• 

It took five years to address multicast, but this is now operational 

•  There  is  no  obligation  for  Openreach  to  provide  products  VF  is  demanding. 

There is even no road map for such enhancements. 

149 

 
 
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Competition

KD-04-18-126-EN-N
doi: 10.2763/342502