Thursday, May 26, 2011

Wholesale provisions in public broadband procurements

It's interesting to note that a number of recent and current broadband procurements include provisions for wholesale broadband access, often combining public sector broadband requirements as well. The information in this post was sourced from tender notices published in the European Union's Tenders Electronic Daily (TED) database, which is is publicly available.

This from Cheshire:
"Cheshire and Warrington SuperFast Broadband:…provision of Superfast Broadband Services to all businesses by and households by 2015…Superfast Broadband infrastructure provisioned will be future proof in terms of capacity and speed and be able to exceed both national as well as European targets. Superfast Broadband Services should offer parity in quality, cost for rural and urban areas. It is expected that the offer of access to wholesale services on the Superfast Broadband infrastructure be made to other operators in an open, transparent and non-discriminatory manner...The strategic partner(s) should consider how Superfast Broadband services could support public bodies in the region that currently operate over 1,000 Public Sector sites with disparate ICT network connectivity in line with the government agenda is to create PSNs (public sector networks) to support converged, fast, secure and reliable communications to lower the cost of public service delivery.”
From Cumbria:
"Provision of Strategic ICT Services in Cumbria: Lot 1: ICT services excluding wide area networks; Lot 2: wide area networks and superfast broadband...provision of both a wholesale superfast broadband network and provision of public sector enterprise network(s)...Lot 2 includes two distinct requirements, which the Authority may seek to procure under two separate contractual arrangements with the Contractor to reflect the different requirements:
i) The provision of a wholesale broadband network;
ii) A managed enterprise network service for the Authority and its Partners.
The wholesale broadband network will be partly funded by the Broadband Development UK (BDUK) programme of work, and is therefore subject to state aid notification requirements which include the requirement for the Contractor to offer wholesale services to other retail service providers on a transparent and non-discriminatory basis for at least 7 years…the Contractor will either have a retail capability, or will partner with retailer businesses...The design, build, operation, maintenance and upgrading of a wholesale broadband network to provide wholesale service that a retail service provider might provide to business and residential consumers, including public sector organisations…the Contractor will also provide network connectivity and ancillary services to the Authority’s enterprise managed ICT service described in Lot 1 (e.g. wide area network services between the Authority’s premises including but not limited to offices, schools, libraries and other Authority premises, and potentially those of Partner organisations including - but not limited to- Police, Health Authority facilities such as hospitals and clinics, fire and rescue service locations).”
 Devon & Somerset:
"Rural broadband project: Lot 1: RDPE funded areas (delivery of fast broadband to 4 rural areas as detailed within the ITT); Lot 2: DCC funded areas (delivery of fast broadband to 2 rural areas as detailed within the ITT)...Devon County Council is…seeking to enable access to the additional capacity, technical capability and geographical coverage that exists in the current physical network infrastructure, without the need to replicate a new network across the county. Somerset County Council has also indicated that its public service network supplier is willing to engage in discussions regarding open access to ducts and poles as part of the "rural broadband project" solution...The primary objective is to provide NGA compatible broadband connectivity to communities within specific geographical areas. Each area is defined by its rurality, some level of economic deprivation, current poor broadband connectivity but relatively high levels of business activity.”
"Lancashire Superfast Broadband Project: The partner will own the superfast broadband network and in doing so will have responsibility for maintaining and upgrading the superfast broadband network, ensuring a sustainable arrangement. The partner will be required to ensure open, equitable and transparent access to the superfast broadband network...The superfast broadband network will be required to be open to all service and communications providers...It is anticipated that the superfast broadband network will be completed within 2.5 to 3 years from the commencement of deployment followed by a minimum operating period of at least seven years during which period of time the Partner will be required to offer wholesale services and access to other operators in an open, transparent and non-discriminatory manner...The proposed contract period assumes a design and construction period of 2.5 to 3 years, followed by an operational period of 7 to 10 years. There will be an option to extend the contract up to a maximum of a further 5 years.”
"Digital Rutland: co-funding and provision of next generation broadband and end user services in the County of Rutland: The intention is to deploy technology neutral next generation broadband infrastructure so as to maximise broadband reach in the county, addressing the issues of "white spots" and areas that market providers will not penetrate on a commercial basis in the near future…Operation of an open provider model leading to a range of communication providers in the market place for both wholesale and retail markets…Increased demand and consumer choice in communication providers leading to competition for ISP provision and cheaper applications and services.”
"UK-East Midlands Public Sector Network Framework procurement of PSN compliant Broadband a)Infrastructure and b) Services: Expressions of interest are invited to develop and deliver an East Midlands PSN compliant a) Infrastructure and b) services, for the period of a) Infrastructure 7 years plus options to extend by 3 years to 10 years, November 2011 to November 2021 to allow for return on investment required to ensure the coverage of the required quality and reach, and, b) Services 4 years November 2011 to November 2015. It is anticipated that suppliers would ,where appropriate, build upon the existing infrastructure and services investment made by the emPSN partners and customers in meeting the varying needs of the public sector and their partners in the East Midlands, and nationally. It is anticipated that any new infrastructure will facilitate the deployment of broadband in the surrounding area, for example by integrating digital hubs into the solution design. This might include the design and provision of community hub infrastructure to enable community broadband provision, along with provision of wholesale data transport products from these hubs. The contract must also ensure that the use of this new infrastructure is compliant with State Aid guidelines for the provision of next generation networks, including ensuring wholesale access and the monitoring and claw-back of super-profit where the network is used for this purpose...The following contracting authorities shall be able to use the contract: Education sites, including schools, tertiary sector and lifelong learning; Local Authority sites, other unitary authorities and the wider public sector; third sector and Institutions of higher education and colleges of further education in the region, and other sites within the East Midlands and nationally to meet the needs of those public-sector organisations which have business needs within the region.”
Do such wholesale provisions potentially offer a mechanism for community networks to plug into a wider local authority or regional infrastructure? For example to purchase backhaul provision?

BDUK's Programme Delivery Model

Broadband Delivery UK (BDUK) last week published the first version of its delivery model, its purpose being "to bring forward network infrastructure upgrades and to improve the accessibility of services in locations where there is a weak commercial investment case".

It's an interesting read, illustrating how rapidly broadband policy has evolved since the publication last December of the strategy document Britain's Superfast Broadband Future, and even since BDUK's second wave bidding guidance published in March. Here are what I think are the most significant new developments.

The delivery model includes more detail of the range of advice and support available from BDUK:
  • Section 7.8.1, page 23 – Broadband Project Toolkit – “a toolkit (guidance, standard documentation and templates) that will provide material from the development of a Local Broadband Plan, through to the procurement or sourcing phase and up to monitoring of the delivery phase.”
  • Section 6.3.2, page 16-17 – Programme Milestones – “November 2011 - Report setting out the lessons learned from Superfast Broadband Pilots and the Government’s approach to investment in broadband until 2015”
  • Section 5.4.2, page 14 – benefits measurement framework: “BDUK and Defra have jointly commissioned the development of a usable analytical framework based on a robust and coherent set of indicators. This will also include guidance for local bodies on the use of this framework. The framework will allow monitoring to be undertaken on a consistent basis across the country, and is intended to be finalised in the second quarter of 2011.”
Also interesting are BDUK's intentions to put in place a procurement framework to streamline implementation for both purchasers and providers:
  • Executive summary, page 2: “BDUK will seek to put in place a procurement framework for the most common commercial delivery approach (investment gap funding) that further projects can call-off where appropriate. In addition, BDUK will procure a separate framework for local bodies to allow consumers and businesses to access broadband services through satellite where it is not economic to use alternative solutions.” 
  • Section 7.2.5, page 18 – BDUK activities overview: “BDUK has developed an overall sourcing approach to Programme delivery. This allows local bodies in early projects to lead their own procurements, with BDUK support to develop a standardised approach. For subsequent projects, BDUK proposed to create supplier frameworks from which local bodies can call-off broadband services. If the early projects demonstrate that there is insufficient competition in the market place then BDUK will consider putting in place overarching bilateral contracts with suppliers, with provisions to ensure a degree of sub-contracting where appropriate. BDUK will also procure a framework contract for local bodies to call-off broadband services for a limited number of customers for delivery by satellite technology.” 
  • Section 13.2.3, page 48 – commercial & procurement approach overview: “Early projects will lead their own procurement processes, and BDUK will work with these local bodies to identify the best ways to simplify and standardise procurement routes. BDUK will seek to put in place a procurement framework for the investment gap funded approach that further projects can call-off from where appropriate. In addition, BDUK will procure a separate framework for local bodies to allow consumers and businesses to access broadband services through satellite where it is not economic to use alternative solutions.” 
  • Section 13.5.3, page 51 – procurement options: “BDUK will prepare for the development of framework contract(s) which local bodies can utilise for subsequent projects based on the investment gap funded model. Local bodies proposing different commercial models, including where a procurement for broadband services is combined with a procurement for public sector enterprise network services, will be expected to undertake their own separate procurements. BDUK will expect that local bodies in England using the investment gap funded model will generally wish to procure through a BDUK framework. It is likely to be a more efficient method of procurement for both local bodies and suppliers, and will be consistent with BDUK’s umbrella State Aid notification.”
  • Section 13.5.4, page 52 – procurement options: “Where local bodies intend to procure local broadband services in combination with a procurement for a public sector enterprise network then it may consider combining the procurements under one OJEU, potentially with different lots. BDUK will work with the PSN Programme to develop guidance on issues to be considered when using this approach.”
Whilst there is clearly a lot of commonality across local authorities and regions, which lends itself to the framework approach, the challenge will be enabling sufficient capacity for innovation in the development of local solutions. It isn't a case of "one size fits all". Open (wholesale) access is key to BDUK's plans, to provide competition and choice and also address State Aid requirements:
  • Section 4.3.1, page 9 – investing in economic infrastructure to maximise growth opportunities: “Stimulate investment in networks that offer wholesale access”
  • Section 11.3.5, page 39 – outputs from local broadband projects: “The retail price of broadband subscriptions will be set by retail service providers (i.e. internet service providers). It is intended that the contracts for wholesale broadband services between local bodies and suppliers will provide for open access to any retail service providers who choose to buy it to ensure ongoing competition in line with the rest of the UK market. It is intended that broadband subscriptions will be available at an affordable price to customers.”
  • Section 12.5.5, page 43 – retail access platform: “To address the potential outcomes, BDUK will encourage, as State Aid dictates, open retail access that is allowed to grow as more homes and businesses are able to access broadband services. This will be achieved by embedding the associated commercial and technical provisions within the core requirements outlined in section 12.3 above. BDUK will explore further with industry whether any further actions are required to ensure that sufficient open retail access is available for local broadband projects.”
It's encouraging that the model includes a renewed emphasis on the potential to re-use existing public sector infrastructure, as well as recognition of the Cabinet Office Public Sector Network (PSN) programme, JANET and other education networks:
  • Section 4.2.2, page 9 – facilitating local delivery: “Provide advice and guidance on making use of available or planned networks for public sector use.”
  • Section 4.3.6, page 10 – investing in economic infrastructure to maximise growth opportunities: “Principle 9: Facilitate the re-use of network infrastructure in which the public sector is investing:
  • Work with the Cabinet Office Public Sector Network (PSN) Programme to encourage the re-use and re-usability of public sector networks which form part of the PSN;
  • Ensure that best practice advice and guidance is disseminated from previous and current local body contracts for PSN and other wide area network projects; and
  • Ensure appropriate linkages are made with other public sector investments (e.g. Grid for Learning and JANET) on a national and regional basis.”
  • Section 7.11.3, page 26 – links with other government policies: “The Broadband Delivery Programme is also discussing with the Department of Health and the Department for Education the opportunities and benefits for individuals to access services over Superfast Broadband, particularly for individuals in rural and remote areas.”
  • Section 8.2.4, page 27 – activities for local bodies – overview: “Re-use of public sector enterprise networks. Local bodies should identify where it is possible to leverage on the value of existing planned investments in infrastructure or services which provide enterprise networks for public sector use.”
  • Section 12.8.3, page 45-46 – use of enterprise networks in the public sector: “Local bodies will need to gather adequate data on the assets that are available for re-use, whether under a single contract, or under multiple smaller contracts. This could usefully include information on public sector investment in route upgrades by network operators over the last 5-10 years. The provision of broadband access to education establishments in particular means that a significant number of routes have potentially been readied for fibre rollout.”
Also good to see more about BDUK's intentions in relation to State Aid, which weren't described in any detail in the bidding guidance published in March:
  • Section 7.8.4, page 23 – broadband project toolkit: “The toolkit will contain…advice and templates for state aid applications.”
  • Section 13.2.4, page 48 – commercial & procurement approach overview: “BDUK will seek an umbrella State Aid approval from Europe for the programme of procurement activities, so that BDUK acts as a competency centre assuring the European Commission that individual projects adhere to the principles of the umbrella notification.”
...which should be of considerable assistance to local authorities and other bodies developing local broadband plans. Finally some interesting comments on demand for superfast broadband:
  • Sections 9.2.5 & 9.2.8, page 32 – the importance of demand: “While access to Superfast Broadband is available to nearly 50% of the population through the Virgin network and a growing percentage of the population through BT’s fibre to the cabinet investment, national take-up is still very low…The Broadband Delivery Programme is supporting a survey being undertaken by the Communication Management Association (part of BCS, The Chartered Institute for IT) to Federation of Small Businesses members to better understand their demand for Superfast Broadband.”
"National take-up is still very low"...this is something we need to consider carefully I think. I wouldn't suggest for a moment that we shouldn't as a country be developing our broadband infrastructure, but this fact should make us pause for thought.

We tend to focus on stimulating demand, which is clearly important, but shouldn't we also be investigating where current broadband infrastructure is a constraint, for homes, businesses and public services? Some instances are clear, like poor availability in rural areas, but others are less well defined and understood. For example, the constraints current broadband provision places on delivering public services like healthcare. We need to understand better all the things that we can't do (but would like to do) with our current infrastructure.

I think we should look to organisations like Australia's Institute for a Broadband Enabled Society (IBES) for assistance here:
"IBES is a cross-disciplinary research institute dedicated to innovations in products, services and end-user experiences that maximise the benefits of new broadband technologies to Australian society. The Institute's activities covers a wide range of fields including Education and Learning, Health and Wellbeing, Business and Service Transformation, Network Deployment and Economics, and Smart Communities and Infrastructure."
As I've said before on this blog, the broadband debate needs to move on from the theoretical ("broadband is important") to the specific ("next generation services enable applications x, y and z, which can't be delivered over current generation services for reasons a, b and c").

If we develop and share our understanding of the breadth of new services and applications that next generation services will support, this can only help to stimulate demand? As in "I want some of that too"?