Friday, April 15, 2011

Some observations on Fujitsu's rural broadband proposals

Like many others, I was very interested to read about Fujitsu's plans, announced earlier this week, to build a fibre network to deliver next generation broadband to 5 million homes in rural Britain.

This is to be welcomed and was widely covered by the media. For example, here's what the BBC had to say:
"Much of the system will be built on BT infrastructure, such as underground ducting and phone poles, which it has been forced to open up to competitors. Fujitsu wants £500m of government money to help fund the project. That would account for the lion's share of the £530m the government has set aside to stimulate rural broadband projects."
Similarly, the FT offered this:
"Fujitsu’s planned £2bn high speed network, based on optical fibre cables, would cover 5m homes in countryside areas scattered across England, Scotland and Wales. Those communities have been at serious risk of never receiving superfast broadband because of the greater cost of building high-speed networks in the countryside compared with towns and cities. Fujitsu’s plans are contingent on it securing at least £500m of the £830m of public funds that the government last year said could help pay for superfast broadband in rural areas."
But here's what Fujitsu's press release actually said:
"Fujitsu, one of the world’s largest technology and communications companies, today announced plans to work in collaboration with Virgin Media, TalkTalk and Cisco to deliver next generation internet services to 5 million homes in rural Britain. The collaboration and subsequent Fujitsu build of a new superfast, fibre optic broadband network is a ground breaking and innovative alternative to BT Openreach and provides an opportunity for any community or local authority looking to access a proportion of the £530 million earmarked by the UK Government to drive investment in superfast broadband in rural communities. The Fujitsu open access wholesale network will be underpinned by Cisco’s world leading technology. Virgin Media and TalkTalk intend to access wholesale products via this network in order to retail next generation services to customers in remote parts of the UK. The network will also be open to other service providers on wholesale terms."
Which part of the above paragraph demonstrates that Fujitsu's proposals are "contingent upon it securing at least £500m" of the funds available to local authoirties and local enterprise partnerships via BDUK? None of it, at least as far as I can see. Perhaps the BBC and FT are privy to information about Fujitsu's plans that I'm not? Or is this simply a case of sloppy reporting? Given the potentially huge landscape changes that Fujitsu's announcement could create, it would've been helpful for key media like the FT and BBC to report it correctly?

Fujitsu's announcement is also particularly interesting in the light of the current dispute over the costs set out in BT's reference proposals for duct and pole sharing, intended to reduce the cost of rolling out next generation access networks, as reported here by the BBC (hopefully correctly this time). Creative Industries Minister Ed Vaizey had this to say in a DCMS statement welcoming Fujitsu's proposals:
"I am delighted that Fujitsu along with Virgin Media, TalkTalk and Cisco share the Government's vision. The collaboration between these companies was exactly the sort of ambition and innovation the Government wanted to stimulate by removing barriers to broadband rollout. Fujitsu and their industry partners are pledging a substantial investment in the UK and it represents a deep commitment to the future success of this country.”
Fujitsu's announcement includes the following in relation to BT's infrastructure sharing proposals:
"The plans rely on the remedy imposed by the regulator Ofcom, on BT Openreach, to provide access to its underground ducts and telegraph poles on fair, reasonable and non-discriminatory terms."
Should this be taken to mean that Fujitsu think access has been provided on "fair, reasonable and non-discriminatory terms", and will proceed with their plans on this basis, or that access has not yet been provided in this manner and needs to be before they do so? My guess is the former, given the use of the past tense "imposed" in the above sentence?

A further perspective on the dispute was provided by the Managing Director of business ISP Fluidata in an ISPreview article:
"The rural piece being supported by Government in the form of BDUK is to help build new networks across the country to support high speed internet access. These companies are using this as an excuse that BT has the commercial edge and hence there is no point bidding for these projects. One could argue however, that on the whole these businesses never have had such an appetite for low density populations and instead want access to BT ducts in urban areas where their networks need expansion. In the case of Sky and TalkTalk being involved I think this is much more opportunistic rather than serious as neither has ever been directly involved in infrastructure apart from housing routers in exchanges as part of their LLU networks. Building out the last mile is certainly a different kettle of fish and something I can see companies such as theirs outsourcing going forward. That leaves the likes of Geo and Virgin who have their own networks and, from what I believe, give no access to BT to any of their own ducts or poles."
Wihile another view was put forward by Fibrestream, arguing that duct and pole access is essentially a red herring, as it's better to build a new fit for purpose infrastructure rather than utilise ducts and poles that may not be appropriate anyway:
" the 21st Century, FttH Overbuilders, led in terms of actual network deployment by NextGenUs UK CIC with its pioneering community-centric social enterprise economics, have little interest in legacy BT assets. The reality in rural areas is that ducting may not be available or even present and the condition of poles may be an impediment to shared access for FttH reuse in any event, regardless of squabbles about actual access costs."
So who to believe in all of this? Fujitsu? Ed Vaizey? Alternative providers? Fibrestream/NextGenUs? Fluidata? BT? Ofcom?

I for one am now totally confused about who's "in the right" in all of this. However, I am sure about one thing: the longer it takes to resolve this dispute to the satisfaction of all parties, the less chance this administration has of reaching its target for the UK to have the best superfast broadband in Europe within the lifetime of this parliament.


  1. I have a sneaky feeling that it is just another way of Openreach getting their hands on the funding through a side door... I agree with fibrestream, lets get some new fibre routes into the rural areas then the private network builders can finish the job off, otherwise it is never gonna get done. Once the affordable pipe is in an area there are many solutions to get it to the homes. Fibre being the best, wifi being an affordable interim measure. What we must not do is let ISPs deliver cabinets and BET. otherwise we are stuck in another digital divide even bigger than the current one.

  2. With the news from BT about the time it takes to install FTTP it will be interesting to see what happens here. And Fujitsu are a BT contractor so know what's involved...