1Legally privileged & confidential

INCA Transform DigitalGrant Forsyth, Head of Regulatory Policy, NGN, Sky

8 May 2014

2

2007 2008 2009 2010 2011 2012 20130%

10%20%30%40%50%60%70%80%90%

Internet take up vs. Fixed internet revenue, 2006-2013

Internet take up (%) Total broadband (%households)Fixed Broadband (%households)

Inte

rnet

take

up

£0

£1

£2

£3

£4

£5

Fixed Internet revenue ...

Fix

ed in

tern

et re

venues

(£bn)

£0

£5

£10

£15

£20

£25

Price £ per month

Pric

e (£

/month

)

2007 2008 2009 2010 2011 2012 20130

2

4

6

8

10

12

14Average speed vs. Price, 2007-2012

Ave actual speed (Mbit/s)

Aver

age

actu

al sp

eed

(Mbi

t/se

c)

2007 2008 2009 2010 2011 20120

5

10

15

20

25

8.4 8.1 8 7.8 8.1 7.5

3.4 3.7 3.8 4 4.1 4.3

3.7 5.5 6.4 7.5 7.9 8.8

0.1 0.41.1

Fixed broadband connections, 2007-2012

Non-LLU ADSL Cable LLU ADSL Other (inc FTTX)

Fixe

d br

oadb

and

conn

ectio

ns (m

n)

Competition in UK BB is dynamic and hugely beneficial for consumers(Source: Ofcom Communications Market Reports)

3

Regulated access to NGA does not provide the same opportunities as LLU

• Ofcom should seek to promote infrastructure investment by CPs to deliver increased competition in superfast broadband – likely to deliver similar benefits as observed with LLU

• GEA provides few opportunities to invest or innovate – it is a white label active product

• Other access products (SLU & PIA) are not fit for purpose – so don’t offer opportunity to replicate the dynamic success of LLU

4

Sky Believe in Better Always innovating, always looking to deliver an even better customer experience

Ultra-Fast Broadband in York

• A joint venture with TalkTalk and CityFibre

• Working with TalkTalk (between us we have more BB customers than anyone else), but we will compete at retail with competing customer propositions

• Technical and commercial trial - to better understand the potential of the technology, economics and customer response

• State of the art city-wide FTTP network

• Unencumbered by legacy infrastructure enabled a focus on what is right for customers

• Delivering 1 Gigabit, initially to 20,000 homes and businesses in York

5

Other fibre initiatives

Improving the customer experience on existing commercial FTTC GEA1. The launch of a new dual ADSL/VDSL router with accompanying wireless boosters

2. Self-install (removing the requirement for home visit by an engineer)

3. Support the call for access to the NTE5 socket – allowing for a holistic in-home customer experience 

Investigating alternative fibre options(On-going process of assessing opportunities to building out our network to better serve customers)

4. Harrow trial of FTTP with TalkTalk in 2011

5. Unbundled FTTC – via a Statement of Requirements (SoR) which is in protracted discussions with Openreach

6. Small scale technical trials including:

a) MDUs – fibre to the basement and various in-building distribution options

b) SLU – various cabinet backhaul options (including PIA) and operational processes

c) FTTH using poles – new network build and operational processes

7. Accept that any approach will need to be flexible, local and no one size fits all

6

BDUK SEP funding

Public Accounts Committee recommendation

“The department should not spend any of the further £250m of public money until it has developed approaches to secure proper competition and value for money for improving superfast broadband after 2015,”

Sky would support: The opportunity to offer our BB&T services over the networks of alternate fibre

networks. A standardised wholesale platform for provision and assurance of access provided by

alternate fibre networks.