INEC members

History

The City Council instigated in 2002 the construction of a fiber-to-the-home network, starting in the borough Zeeburg. An advisory committee chaired by former Minister of Economic Affairs Koos Andriessen has investigated how to realize this goal. The City Council has set the conditions for investment in 2004. With the results of the European tenders and the establishment of GNA these conditions are met.

Market Economy Investor, no state aid

The municipality (1/3) plans to participate together with five housing corporations (1/3 of shares) and investors (1/3 of shares). GNA will deploy approximately 40,000 fiber-to-the-home connections in the boroughs Zeeburg, Oostwatergraafsmeer and Osdorp (10 % of Amsterdam). The Mayor and Alderman have agreed to put this decision to the City Council. The economically most favorable offer for the construction of the network has been made by the consortium Van den Berg Infrastructuren (BAM)/Draka Comteq Telecom. The economically most favorable offer for exploitation of the network as a wholesale provider has been made by BBned .The shareholders of Glasvezelnet Amsterdam BV invest under the same conditions in a profitable business with an acceptable risk/reward-relationship. The investment of the Municipality is therefore according to the Market Economy Investors Principle (MEIP). There have been several informal contacts with the European Commission on the criteria and conditions regarding the MEIP. Deputy-mayor Van der Horst “I’m glad all signs read green. To be crystal-clear: the Municipality does not subsidize and gives no additional guarantees. We invest as local government in a promising innovation, on equal terms and conditions as our partners.” The Municipality of Amsterdam is one of the shareholders of Glasvezelnet Amsterdam BV (GNA).

Housing corporations: connecting homes

The housing corporations invest in the local loop connecting their property through Glasvezelnet Amsterdam BV. Joint investments through this limited company are cheaper, easier and profitable. After consultation with the Minister of VROM (Housing, Spatial Planning and Environment) the structure of the investment by Woonstichting de Key, Algemene Woningbouwvereniging, Woningstichting Rochdale, Woningcorporatie Het Oosten and Stichting Ymere in Glasvezelnet Amsterdam has been determined. Anticipating the new “Besluit Beheer Sociale Huursector” (the regulatory framework for social housing corporations) they will invest this commercial activity through a separate entity with specific financing.

Planning and decisions

The proposal of Mayor and Alderman to the City Council to agree to participate and invest in Glasvezelnet Amsterdam BV for approximately 1/3 of the share capital will be discussed in the Council Committee later this month and shortly after voted upon in the City Council. The other shareholders of Glasvezelnet Amsterdam BV will follow their individual formal decision procedures. It is expected that the shareholders agreement can be signed in December 2005. The construction of the network and the subsequent delivery of services will start in 2006, to be finished at the end of 2007. The test of the conditions for MEIP by the EC is expected to start after the signing of the shareholders agreement.

Deputy-Mayor Mark van der Horst (infrastructure, harbor, fiber): “With GNA and the offers by respectable companies we make a big step towards the deployment of a citywide fiber-to-the-home network. This enables our city to compete with other European cities. The fiber network delivers to Amsterdam an innovative and freely accessible infrastructure, suitable to support growth in demand for the next 30 years or more. In this way we ensure a wide open marketplace for innovative service-providers and economic growth, as well as a fast track for the smarter and cheaper delivery of care, education and other public services.”

Three layers

The network in Amsterdam is structured in three separate layers:

• Infrastructure: GNA will commission the construction of the passive network and own the fiber infrastructure in the local loop. Van den Berg Infrastructuren (BAM)/Draka Comteq Telecom have submitted the economically most favorable offer for the construction. “Smart digging”, like laying cables together with utilities will be used as much as possible.

• Exploitation: a wholesale provider who rents the infrastructure from GNA activates the local loop. BBned (Telecom Italia) has submitted the economically most favorable offer for the exploitation of the network.

• Services: The network is as open as possible (within practical and economical limitations) for service providers: commercial, non-profit, public services, large or small, traditional or very innovative. The service providers are able to purchase transport capacity at non-discriminatory conditions to deliver services to their customers.