On 21 June 2018, the Swiss Communications Commission rendered a decision rejecting a request from Sunrise to order “Virtual Unbundled Local Access” on the network of the incumbent operator Swisscom for lack of a legal basis. However, it explicitly stated that from a teleological viewpoint, it would make sense to allow for virtual unbundling. This statement is clearly a signal to the Swiss Parliament that is currently amending the Swiss Telecommunications Act, thereby having the capacity of taking into account the recent technological developments and introducing an obligation to grant technology-neutral and virtual access to the network of market dominant operators. This would foster competition ultimately to the benefit of Swiss consumers.

According to the decision of the Swiss Communications Commission (ComCom), Sunrise submitted a petition for a regulated “Virtual Unbundled Local Access” (VULA) in February 2018. VULA constitutes an alternative to physical unbundling and enables a bitstream offering for continuous broadband data connection also via hybrid lines combining optical fibre and copper cable.

In Switzerland, only copper cables are regulated. According to the decision of ComCom, the current Swiss Telecommunications Act (TCA) contains no sufficient legal basis to provide for virtual unbundling. In the authority’s view, this demonstrates that the existing access regulation is outdated. The current regime is no longer suitable for ensuring competition, for example with regard to unbundling of today’s more common hybrid connections that comprise both fibre optic and copper cable. At many locations, the existing copper cables will only be used anymore over the last metres to the costumer. The rest of the lines are continuously replaced by fibre optic cables. New transmission processes, namely vectoring and G.fast, allow for high bandwidths on the remaining copper cables.

Against this background and within the scope of the ongoing revision of the TCA, ComCom favours the Swiss Parliament to introduce the option of technology-neutral and virtual access to the network of market dominant operators. Pursuant to ComCom, alternative operators will otherwise lose out since competitive offerings could often no longer be provided with mere physical unbundling of the local loop because of unilateral conditions (restricted use of frequencies on copper cable, no free choice of technology). In particular, if a network operator itself uses vectoring, then only the slow ADSL technology could be used on the unbundled loop. In order to be able to provide clients with competitive offers, alternative providers are thus compelled to procure a commercial broadband connectivity service (BBCS) from Swisscom.

It remains to be seen whether the Swiss Parliament will follow ComCom’s call to introduce the option of technology-neutral and virtual access to the network of market dominant operators, a scheme that would foster competition and thereby leverage one of the main aims already contained in the currently applicable TCA ultimately to the benefit of Swiss consumers.