Monday, November 21, 2011

NextGen11 conference report day 1: progress?

The NextGen11 conference took place last week (on 15-16 November) in Bristol (presentations here). Here's my report, to follow on from my accounts of the 2009 and 2010 NextGen conferences.

The conference opened with a video address from Neelie Kroes,  Vice President of the European Commission and European Digital Agenda Commissioner, who made her position on the importance of superfast broadband very clear:
"...the Internet is an economic essential for everyone. From businesses small and large, to academia, to the creative industries, fast broadband is the digital oxygen allowing this ecosystem to thrive and boosting growth. It is hard to imagine a confident and prosperous Europe in 2020 without it."
She went on to mention the two current EU consultations (on cost methodologies for wholesale access and non-discrimination obligations), in the context of establishing the right regulatory environment to drive increased  investment in superfast broadband, together with the funds being made available for broadband through the Connecting Europe Facility.

Neelie Kroes' address was followed by Chris Holden, President of the Fibre to the Home Council Europe. Europe is currently a long way behind other parts of the world in terms of FTTH penetration, with 4.6m FTTH subscribers: China has 46m. The UK, as of June 2011, has 4,500 FTTH subscribers and 567,300 homes passed out of 25m households. On the basis of current takeup, the UK will reach "fibre maturity" (10% takeup) after 2020. In Europe, unlike most other regions, incumbents are not currently the major providers of FTTH, and this will remain the case. Meeting the EU target of 50% subscribers with >100Mbps service requires maybe 80% availability, which seems very challenging, underlining the importance of "good old-fashioned marketing" to increase takeup and demonstrate the case for further investment. It will be interesting to see the outcome of the current EU consultations in this regard.

Suvi Linden, former Minister of Communications, Finland, and Commissioner, United Nations Broadband Commission for Digital Development, spoke next. The Commission provides an advocacy role for broadband, in the belief that "broadband connections are an essential element in modern society, like roads or electricity." The evidence Suvi presented of the impact of broadband on economic growth (from the Commission's report Broadband: A Platform for Progress) was particularly striking: each 10% increase in broadband penetration generates a 1.38% increase in GDP in low/middle income economies, and a 1.21% increase in high income economies. Suvi also described the targets set out in the Commission's Broadband Challenge, published in October 2011: that broadband should be universally available and affordable, with high takeup and usage as a result. She went on to describe policy developments in Finland, in particular, the Government's recognition that "broadband has become a basic service" and the consequential importance of ensuring universal availability. By the end of 2015, all permanent residences in Finland should be within two kilometres reach of a high-speed connection permitting at least a 100Mbps service; this will require partly subsidised high-speed connections for around 130,000 households in rural areas.

Next up was Bill Murphy, Managing Director NGA, BT. Bill described developments in Cornwall, where BT is rolling out a variety of next generation broadband services. 71 cabinets are now live with 2000+ customer connections, provided by 12 communications providers. Bill stressed that affordable, effective next generation broadband services can and are being delivered over copper via FTTC, that BT was also looking at FTTH and that there was no reason why the approach taken in Cornwall couldn't work elsewhere. He also flagged developments in Northern Ireland, where NGA is available today to 85% of businesses and 75% of lines are connected to a fibre-enabled cabinet (reaching 89% by March 2012), connecting 44,000 customers, with 1,200 more being added every week. More widely, BT plans to deliver ADSL2+ services to 90% of the UK, possibly more (including this exchange I hope?) and currently has more than 300,000 subscribers to its Infinity service, with c.50 external service providers using BT's fibre services. Alternative technologies under consideration to reach the last 10% include white space technologies (as being trialled on the Isle of Bute in Scotland, satellite (BT is working with Avanti in Cornwall) and 4G mobile services (also being trialled in Cornwall with Everything Everywhere, in St Newlyn East and the surrounding area of South Newquay, with around 200 participants). In reference to the current debate about BT's physical infrastructure access (PIA) offerings, Bill pointed out that PIA represents a small part of the cost of deploying fibre; we should "move on" and simply "get on and do something".

In answer to Bill's challenge, Keith Vinning of Fujitsu was next, providing an update on Fujitsu's plans to provide a wholesale broadband infrastructure in rural areas, as announced earlier in 2011. Fujitsu is not seeking to provide retail broadband services and is looking to deliver via the funding being made available by BDUK, subject to its inclusion on BDUK's procurement framework (more here) and winning business from local authorities purchasing via the framework once it's in place. On the subject of funding, Keith suggested that the £17bn committed to the High-Speed Rail project would be better spent on broadband (a view echoed here) and also explained that, like BT, Fujitsu is looking at a range of access technologies as it is simply not economic to deploy fibre everywhere. Successful PIA trials have been undertaken in Greasby in the Wirral, with services being provided to customers by TalkTalk and VirginMedia over BT's ducts and poles from the  serving exchange to customers' premises. Overall, Fujitsu's experience of working with Openreach had been "positive"; while there remains work to do to "industrialise" processes to enable roll-outs at scale, the company is "optimistic" about the future. However, the limitations on what PIA can be used for remain a concern, particularly the fact that PIA can't be used to provide backhaul for wireless services in rural areas. Keith closed by stressing the importance of driving demand for superfast broadband, reiterating the importance of matching aspirations with the amount of funding available.

Keeping us from our lunch was futurist Rohit Talwar, but fortunately Rohit spoke eloquently and passionately about the potential of superfast broadband. He began by considering how to get politicians and society at large excited about superfast broadband, citing the approaches taken to infrastructure development by China and India. China has adopted the "build it and they will come" approach, whereas India waited for demand to emerge. China's economy is now three times the size of India's. Rohit argued that broadband is fundamental both to growth and the future well-being of society, given current economic turbulence, the "power shift eastwards", ageing populations and environmental issues and concerns. But we must always remember that what technology makes possible is what will drive demand, not the technology itself.

After lunch, Edgar Aker of the Prysmian Group flagged the importance of national policies and plans and the right regulatory environment in driving investment and competition in NGA. He commented that eastern Europe is leapfrogging straight to fibre provisioning for broadband, bypassing current generation services. This business case for rural broadband is key, with the FTTH Council Europe's FTTH Business Guide a key resource to support planning and development. This was followed by a panel discussion about the future Internet, with Dave Carter of the Manchester Digital Development Agency memorably demanding to know when we'd all have the flying cars he'd been promised in visions of the future in his youth...!

Day one closed with a series of three parallel workshops; I attended the one on technology choices for NGA. Simon Barrett of Avanti covered satellite possibilities and opportunities. James Enck of CityFibre Holdings outlined the company's plans to become "a new force in UK fibre infrastructure", following the acquisition of the assets of the troubled Fibrecity project (more on this here and here). Dinesh Patil of Telefonica O2 explained the huge impact smartphones continue to have on mobile networks and the steps being taken to accommodate ever increasing demand. For example, major sports events now create huge localised demand, as stadium crowds access live coverage and commentaries on their mobile devices. Next year's London Olympics are likely to be particularly challenging in this regard. Finally, Paul Sexton-Chadwick of The Cloud/BSkyB described how wifi is addressing the shortcomings of 3G mobile connectivity, particularly in the light of Ofcom's revised timetable for the UK's 4G spectrum auctions.

That wrapped up day one, my report of day two to follow shortly.

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