Excuse my ignorance, but at that point what does the ISP actually do other than send bills to customers and pay invoices for fiber plant and upstream bandwidth?
In many if not most areas in the United States DSL (digital subscriber loop) based Internet access was originally delivered over PVCs established through a layer 2 ATM network. There were interesting problems with that so PPP or PPP over Ethernet is more common these days, even when the telco no longer really lets anyone compete with them in the provision of broadband Internet access services at layer 3 over the network they maintain thanks to a rather convenient federal court decision.
Layer 2 mostly Ethernet access over VLANs (virtual local area networks) to a chosen provider does live on in certain mostly municipally owned multi-provider networks though, and in some countries that is normal, although usually with the incumbent telco or ILEC (incumbent local exchange company) installing and maintaining the last mile to homes and businesses rather than a municipal operator as in some parts of the United States. Either way more than one provider can provide layer 3 Internet service on the same physical facilities that way, with layer 2 (e.g. switched Ethernet) virtual lans or virtual circuits operated by one company or municipality.
In my setup I don't think the ISP has any local hardware - they're all national, and run on the hardware provided by the fibre guys.