UK to crack down on imported Chinese optical fiber cables
5.7 million fiber kilometers of the stuff could be worth £88M to Brit players, claims government
The UK is cracking down on Chinese imports to protect its optical fiber cable market, which translated to a length of approximately "5.7 million kilometers" in 2021 alone.
It's bad news for importers of optical fiber cable from China specifically, with upcoming trade "remedy measures" to be imposed including new anti-dumping duties that range from 23 percent to 46.2 percent, and new countervailing duties ranging from 10.62 percent to 11.79 percent.
Britain's Trade Remedies Authority (TRA) estimates the UK's domestic product is worth £88 million ($107 million) to the economy annually. The country made the move on the advice of the TRA, which estimates UK-made optical fiber amounts to about half of all the country's consumption, with the rest of the market supplied by imports from China, India, the US, Poland, and Germany.
The TRA had been investigating single-mode optical fiber cables sourced from China since last year. The probe looked into whether imports of these products were dumped in the UK at prices below what they would sell for in their home country, and if they were sold at unfair prices due to subsidies in two separate cases (AD0021 and AS0022).
The local industry alleged in its submissions that Chinese producers were the "main drivers for exercising downward price pressure during tender proceedings and that, even if they are not ultimately selected, they nevertheless force the UK industry to significantly decrease their prices to unsustainable levels."
Interestingly, an application for one of the investigations that prompted the probe was filed by an outfit called Prysmian Group, which supplies fiber-optic cable to Openreach, BT Group's infrastructure subsidiary. Prysmian inked a three-year contract [PDF] with Openreach in 2021.
The report noted that Prysmian has a significant presence in the UK industry. Not only was it the only UK producer of optical fiber cable to support the application, it is also behind "at least 25 percent of the total production in the UK of the like goods," meaning the government accepted it was made "by or on behalf of a UK industry."
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Announcing the measures, the TRA said the UK market in optical fiber cable is expected to grow over the next five years, driven by network upgrades as the public demands better broadband as well as by the government's investment in broadband infrastructure, including Project Gigabit.
On the subject of Project Gigabit, as we pointed out yesterday, the UK public's take-up rate, meaning the proportion of households within the fiber network range who have actually hooked up to fiber services, is relatively low at 20.5 percent. As a result, network intelligence outfit Ookla has called for a "required industry focus on selling fiber subscriptions."
Virgin Media, Sky, and other internet service providers are also investing in optical fiber infrastructure – with Virgin Media O2, the offspring of Liberty Global and Telefónica, moving across to an all-fiber network approach. The company said back in 2021 that it planned to overbuild "the vast majority" of its infrastructure with fiber to the premises by 2028, although it also continued work on its concurrent gigabit upgrade of its DOCSIS 3.1 HFC infrastructure.
We've asked Openreach and Virgin Media O2 if they expect the market moves will impact their bottom lines. ®