Fiber Optic Agreement

The IRU “means the exclusive, unlimited and unworkable right to use the relevant capacity (including equipment, fibre or capacity) for any legal purpose.” [1] It refers to the bandwidth purchased, for example after the sealing of a submarine wiring system at the end of construction, and the maintenance contract (C-MA) between the owners. This is a way for homeowners to use unused capacity or any unused capacity after the system is put into service. In this case, the dark fiber is called “dark” because it must be illuminated by the IRU owner and not by the cable owner. Wholesale purchases of dark fibres have generally been made with the help of IRUs. Owners of fiber cables do not generally sell their fibre optics, but offer IRUs for unlimited use for up to 20 years. 10 to 25 years corresponds to a typical lifespan of fiber optic systems. The cost of purchasing a 20-year IRU can be a one-time investment. It will generally be linked to current obligations for joint maintenance. As a general rule, the IRU can be considered a physical asset that can be resold, traded or used as collateral. The IRU black fibre (DF) “means the exclusive, unconditional and unenforceable right to use one or more strands of fibre in a fibre optic cable for legal purposes.” With an IRU contract agreement, the buyer of the IRU can use the IRU fibers unconditionally and exclusively for a long period of time, about 25 to 30 years. [3] The IRU contract sets out detailed technical and performance specifications for IRU fibers.

Specifically, it includes dark fiber acceptance and testing methods, description of the physical route of black fibre, operating specifications of the black fibre infrastructure, performance specifications (amortization, chromatic dispersion, polarization dispersion, return optical loss), maintenance and recovery conditions. These conditions must be valid for the duration of the IRU contract. It also includes specific measures and procedures in the event of changes to the IRU`s fibre optic network, deterioration of fibrous power, etc. According to the Wall Street Journal, Dark Fiber was created decades ago by AT-T as a pioneer, while it still enjoyed monopoly power. The IRUs allowed ATT`s competitors to access the expensive under-sea cables that only AT-T could afford. [2] There are still some controversies regarding the booking of IRUs as assets in an asset swap transaction between companies. Since iRu`s has technical rights to a physical part of a cable, they can be considered an asset, which means that their costs are not part of the company`s operating income, but appear among the tangible assets. The IRU is counted as if it were part of the physical facility of the company that buys the IRU. [2] An unenforceable right of use (IRU) is a kind of permanent telecommunications lease that cannot be cancelled between the owners of a communication system and a customer of that system. The word “unenforceable” means “not being able to be declared or unreported or cancelled.” The client acquires the right to use a certain amount of the system`s capacity for a number of years. IRU contracts are almost always long-term and usually take 20 to 30 years.

The communication system can be a wire cable. B, for example, an underwater communication cable, a fibre optic cable or a satellite. An IRU owner may use unconditionally and exclusively the corresponding capacity of the IRU`s network of beneficiaries during the specified period. In short, the purchase of an IRU gives the buyer the right to use certain capabilities on a telecommunications system, including the right to lease that capability to someone else. Small businesses that need a rental line between, say, London and New York do not buy IRU — they lease capacity from a telecommunications company that can itself lease more capacity from another company (and so on).