Securing robust and redundant Broadband infrastructure - A public responsibility?

• Norway's leading provider of fiber-based data communication

to businesses, operators and public sector.

• Consolidations player, 15 acquired companies, 9 physical networks

• Leading infrastructure builder in Norway - 40,000 km fiber

• Connecting more then 90 Norwegian cities from north to south

• Strong redundant metro structures

• Fiber rollout in 178 municipalities over the last 2 years

• Investment level NOK 500 million per year

• Owned by EQT- Northern Europe’s leading private equity company.

Broadnet

Norway in a nutshell 17 people per square kilometer

1 person per square kilometer north of Trondheim

Oslo - Hammerfest = Oslo – Athens

96 % of Norwegian companies have less then 50 employees

The world´s biggest sovereign wealth fund

Current government ambition: 100 Mb/s to all within 4 years…

… at cost € 2,4b – 3,6b

Challenging climate for infrastructure, building and maintenance

Roll out cost is high, complicated bureaucratic system

Burying the value creation

• Trenching constitutes 80% of total costs related to

rollout of high speed broadband

• We have 428 local trenching regulations in Norway

– Rollout costs vary by 2000% per meter

– Approval procedures varies from half a day to half a year

• EU are looking to implement new regulation that cut costs

related to digging with 30%

The Norwegian broadband challenges • Climate and distances complicate the development of a coherent national infrastructure

• Delivering broadband to small, rural communities is not commercially viable…

– Enormous distances

– Low population density

– Lack of private business demand

– Tough weather conditions

• …but these communities are as dependent on the infrastructure as cities and security demands are equally high

• Not robust, many situations of network failure

• The building of infrastructure is not coordinated, which makes it impossible to get a national, robust ultra broadband

– Numerous very small players – 120 utilities

– Government funding without any national, coordinated infrastructure/network plan

What we are struggling with on-shore we have succeeded with off-shore – without public funding!

Enabling Integrated Operations

What we are struggling with on-shore we have

succeeded with off-shore – without public funding!

• Niche telecom carrier with core focus on the offshore Oil & Gas Industry

• 14 years experience in providing high speed, low latency offshore communications

• Established by Statoil in 2001, acquired by HitecVision August 2010

• Tampnet acquired NSC from TeliaSonera in August 2011

• Acquired by EQT in 2012

• Providing high-capacity and low-latency infrastructure based on; − Subsea fibre optic cable system

− Line-of-Sight solutions

− Wireless communication (LTE/4G) for mobile units

• ~100 fixed offshore assets are connected to the infrastructure

• Acquired Airtap in Gulf of Mexico spring of 2014

• Acquired CNSFTC from BP in 2014

• Aberdeen office opened in 2014

About Tampnet

Tampnet;

• Being the common network and infrastructure “planning department” for the entire North Sea

• Securing robustness for all players through diversity and redundancy – building across other infrastructures

• Taking some of the roles we are missing on-shore

• Norway daily oil & gas production is approx. 1.800.000 barrels of oil – daily revenue approx USD 180.000.000

• Oil & gas companies implementing Integrated Operations – remote operating and controlling platforms and sub-sea installations/equipment from terrestrial control centers

• Integrating mobile units/vessels into platform operations – LTE as carrier

• Dependent of 100% availability from low latency, high speed communication

Critical Infrastructure

Even more challenging conditions for broadband

infrastructure !

Harding

Gina Krog

Sleipner

Martin L

Bressay Bruce

Alba Britannia

Montrose Forties C

ETAP Lomond Nelson

Everest

Judy

Andrew

Forties B

Varg

Brae B Brae A

Tiffany

Claymore Piper B

Tartan

Buchan

Draupner

Clyde

Brent

Magnus

Murchisson Snorre Gullfaks C

Kvitebjørn

Troll A

Gullfaks A

N Alwyn Veslefrikk

Oseberg

Ninian C Heather

Cormorant A North Cormorant

Tern Eider Thistle

Beryl B

Beryl A Alvheim Heimdal

Jotun B Ringhorne

Grane

Brae E

Gryphon

Scott

Ula Gyda

Ekofisk Fulmar

Murdoch

Kårstø

Stavanger

Lista

Oslo

Aberdeen

Lowestoft

London

Kollsnes

Scotland

England

Norway

Denmark

Germany

The North Sea

Belgium

Netherlands

France

Mariner

Janice

Edv Grieg

Shearwater Elgin/Franklin

Gannet Triton

Kittiwake Erskine

Jade

Armada

Cygnus

LOGGS Viking

Copenhagen Esbjerg

Brage

Valhall Hejre

Forties Unity

Balmoral

CNSFTC

The Tampnet

Infrastructure including CNSFTC

FIBRE OPTIC CABLES

RADIO LINKS

NEW FIBRE CABLES

LEGEND:

PLANNED LTE COVERAGE

150

Public Sector – the biggest market segment of network

service users ? State

Municipal

County

50

450

• Not including state controlled limited companies

•Estimated annual spending on network

services - NOK 24 billion

•No coordination related to potential

development of national infrastructure and

networks

•No aggregated use of Public sector

purchasing power

• In addition the government is subsidizing

fragmented, local infrastructure

development

Today´s public tenders and

telecom market building

principles

No co-ordination of public

procurement of networks services

At a lower cost, systematically

establishing higher level of robustness

and security

How it could be solved

with co-ordination

Change of the Regulators role key to future robust networks

• The traditional role of regulators in dismantling Telco monopolies is redundant

• Policy and regulation must be modernized for the 21st century

• The role of the regulator must shift from dismantling monopolies to ensuring a robust digital infrastructure – “National infrastructure and network planning department” – on behalf of all market players and public sector

– Commitment to long-term growth of the digital economy

– Remove barriers to expansion of digital infrastructure

– Modernization of policies and regulations to encourage investment and innovation

– Public sector bid-coordination office – securing maximum infrastructure development related to public network service tenders

From Telco watchdog to Network planning, developing and

safeguarding the digital infrastructure

Enter the new Super-department of Digital Infrastructure

• Owning the national network planning – Mandatory reporting of all infrastructure development

– All public acquisitions are coordinated by the Super-department

– Using the Public purchasing power to fund a robust infrastructure development

• Active role in national emergency planning

• Secure diversity and redundancy in public infrastructure

• Managing coherent national framework for infrastructure

development

Norway should look to Britain

• UK´s Public Services Network is a great example

• PSN is a “network of networks” for the public sector, integrating existing commercial networks

in a public super network

• For example Ministry of Defense will move from 19 separate networks to a single defense

network, saving GBP 700 million

• Total PSN savings are estimated at GBP 500 million per year from 2014

• As of this year, PSN will serve 80% public sector users