Turkey considers merging telecom fibre infrastructure into one entity

Reuters

Turkey is considering adopting a unified fibre optic telecoms entity to expand its network, signalling it could create a separate manager for the expensive infrastructure investments, a senior official told Reuters.

The study is at an early stage and all options remain on the table, said the Turkish official, who has direct knowledge of government telecoms policy but requested anonymity.

Such a consolidation of telecoms infrastructure could help accelerate Turkey's broadband internet usage and speed, benefit smaller service providers and pose a challenge for the network's largest stakeholder, Turk Telekom, opens new tab.

"We are considering the unification of the fibre infrastructure and conducting a study on it," the senior Turkish official said when asked about some sector demands for infrastructure and sales to be separated, and for the establishment of a common infrastructure holding company.

"It is in early stages and not yet finalized. By establishing a common infrastructure, we aim to further strengthen our country's fibre-optics network," the official told Reuters.

For years Ankara has demanded that telecom operators invest more to accelerate fibre network expansion. The companies have grown the network by a bit more than 3% per year over the past decade, and have partly blamed complicated permissions and high costs for the slow progress.

Network ownership

Turk Telekom owns and maintains 78% of Turkey's 577,000-kilometre (359,000-mile) national fibre network through a concession agreement that is set to expire in 2026.

In July, UK-based Vodafone's Turkey unit again suggested in a report that the business of selling telecoms services should be separated from infrastructure investment and management, which could be handled by a separate "common" entity.

In September, Turk Telekom's chief executive rejected the suggestion, saying it was aimed at carving away its infrastructure assets, which are set to return to the government once the concession period ends.

Turkey trails its peers on fixed-line broadband internet usage, with 23 subscribers per 100 inhabitants as of last year, below the Organization for Economic Co-operation and Development (OECD) average of 36.

It also lags on broadband speed with less than one high-speed subscriber with greater than 100 Mbps speed per 100 people, compared to a 24 OECD average.