A broadband network consists of passive infrastructure, active equipment technology and delivery of services. The three layers are characterised by different technical and economical features. These layers are:
The three layers depend on each other, meaning that layer 2 can only be realized upon layer 1 completion, and layer 3 requires the infrastructure from layer 2.
For the three layers, three main business roles can be identified:
Besides the three provider groups, end users and wholesale customers complete the list of actors and their roles typically involved in broadband projects.
The actors can take over different roles, thus defining the business model that applies for the respective broadband project. The difference between the two models is that a vertically integrated model has one market actor taking all three roles and for open networks the roles are separated.
Three open network business models can be identified: