Tuesday, December 06, 2011

UK broadband update


A flurry of broadband-related announcements and activities over the past couple of weeks. Last week's Autumn Statement by the Chancellor of the Exchequer (press release here) set out the Government's plans for further investment in broadband infrastructure, alongside new investments in roads and railways. These include the establishment of a new urban broadband fund:
"The Government will invest £100 million to create up to ten ‘super-connected cities’ across the UK, with 80-100 megabits per second broadband and city-wide high-speed mobile connectivity. There will be a particular focus on small and medium-sized enterprises (SMEs) and strategic employment zones to support economic growth. Edinburgh, Belfast, Cardiff and London will all receive support from this fund, and a UK-wide competition will decide up to six further cities that will also receive funding."
The Autumn Statement also referenced plans to improve mobile coverage across the UK:
"As announced on 3 October 2011, the Government will invest up to £150 million to improve the coverage and quality of mobile network services for the five to ten per cent of consumers in areas of the UK where existing mobile network coverage is poor or non-existent, with the aim of extending coverage to 99 per cent of the UK population. The Government will begin procurement by spring 2012 with businesses and consumers benefiting from improved coverage from early 2013 onwards."
The Government will support rural broadband specifically by:
  • opening the £20 million Rural Community Broadband Fund to help ensure more rural homes and businesses receive superfast broadband. If it is successful the Government will consider extending it;
  • working closely with North Yorkshire County Council, one of the pilot areas for superfast broadband rollout, to ensure businesses and consumers get greatest benefit from the new service and to allow other local areas to learn from this experience; and
  • considering new approaches to make the roadside telecommunications network available to enable points of access for third party services such as broadband for rural businesses.
Commentary from the BBC here. Published to coincide with the Autumn Statement was an updated National Infrastructure Plan 2011, which explains more about the Government's plans on pages 65 – 72 of Chapter 3 ("The UK’s communications systems"), with some further detail in Chapter 2 ("Priority programmes and projects"). According to pages 26-27 of the plan, to enable the delivery of communications infrastructure, the Government:
  • remains firmly committed to ensuring the auction of 4G spectrum commences by the end of 2012, in advance of the spectrum becoming available for new use in 2013. The Government will ensure the spectrum is cleared and interference problems are fully resolved ahead of use. Ofcom will launch, in the coming months, a further consultation on the auction process. Everything Everywhere and BT are already collaborating on a trial of next generation 4G (LTE) mobile broadband services in Cornwall, and O2 have started a 4G (LTE) trial in London;
  • will explore whether there is scope for enhancing mobile coverage along transport corridors, in particular through better co-ordination between the rail sector and mobile operators;
  • has announced superfast broadband funding allocations for over forty local areas across the UK, with Local Broadband Plans already agreed in nine of those local areas. Five local projects are currently in procurement as Broadband Delivery UK (BDUK) pilots in Cumbria, North Yorkshire, Highlands & Islands, Herefordshire/Gloucestershire and Rutland. In addition, the Welsh Government is in procurement, involving BDUK funding;
  • is accelerating national roll-out of superfast broadband by deregulating overhead deployment and publishing advice notes on streamlining streetworks and micro-trenching;
  • remains committed to releasing 500MHz of public sector spectrum by 2020. Sharing of some MoD bands has already begun. Much of the spectrum under consideration may be suitable for mobile broadband;
  • has supported significant progress on opening up access to BT’s ducts and poles to support broadband rollout by competitors, and BT’s revised offers include prices that are substantially lower than the initial offer in January (up to 60 per cent in some cases). BT recently announced that their £2.5 billion programme of fibre investment will now complete in 2014, one year earlier than originally planned, while Virgin Media has confirmed plans for its premium 100 megabits per second product to be available across its entire network by mid-2012; and
  • wants to use the European Regional Development Fund to roll out superfast Broadband. It is issuing draft guidance next week, which takes a flexible approach to ensure local areas can benefit. Up to £100 million may be available and the Government will work with local partners to start making this happen.
Further information on the £20m Rural Communities Broadband Fund (RCBF) mentioned in the Autumn Statement is available here, with details of how to apply here. The first application round began on 1st December 2011, prospective applicants must complete and submit an expression of interest and an accompanying data book by 31 January 2012. A second round  is  likely to open between 1 April and 31 May 2012 but this remains to be confirmed.

The fund is to support the provision of superfast services in the final hard to reach 10%, or those areas that won't be reached by existing BDUK funding allocations to local authorities. These existing allocations are intended to support the delivery of superfast broadband (defined as >24Mbps, i.e. above ADSL2+) to at least 90% of premises in each local authority area. The BDUK funding must also support the provision of at least 2Mbps services to 100% of premises. From the fund's FAQs:
"Solutions must be Next Generation Access superfast solutions (ie greater than 24Mbps). This is a requirement of the European funding that makes up part of the RCBF. Projects must demonstrate additionality i.e. – be clear about what extra things will happen as a result of receiving a grant because the main BDUK rollout programme allows for projects between 2Mbps and 24Mbps as part of the standard solution in the final 10% area."
Which rather suggests that to be successful in obtaining funds, community projects in this last 10% will most likely need to focus on FTTC/FTTH solutions, as satellite and wireless solutions (as far as I am aware) can't currently provide this bandwidth in the last mile? Such technologies should be considered instead as part of BDUK rather than RCBF projects, to deliver minimum 2Mbps connectivity everywhere?

Referenced in the Autumn Statement and National Infrastructure Plan was this new advice from DCMS on microtrenching ("an innovative deployment technique that is generally cheaper, less disruptive and quicker than conventional dig techniques") and street works, together with a new consultation on relaxing the restrictions on the deployment of overhead telecommunications lines (which closes on 21st February 2012). Both are intended to help streamline the installation of the new infrastructure necessary to deliver superfast broadband services, in recognition of the fact that reducing the cost of deployment is key to creating the right conditions for investment.

Also published last week by DCMS was a report outlining lessons learned from the four intial BDUK pilot projects (in Cumbria, Herefordshire, the Highlands & Islands and North Yorkshire, more here) announced in October 2010, as part of the Comprensive Spending Review. Lots to digest here, so I'll cover this more fully in a future post. In addition, this week saw the publication by DCMS of the non-confidential responses to Culture Secretary Jeremy Hunt's open letter asking a broad range of questions about the communications sector published on 16th May 2011, as a precursor to the forthcoming communications review. A green paper is to be published early in 2012. As part of this process, DCMS commissioned this analysis on the contribution of the communications sector to economic growth and productivity in the UK, the results from which were published in September 2011. Again, this looks like something to cover in more detail in a future post.

Finally (!) last week, both Ofcom Chief Executive Ed Richards and Neelie Kroes, Vice-President of the European Commission responsible for the Digital Agenda, gave speeches at the 2011 European Competitive Telecommunications Association (ECTA) Regulatory Conference in Brussels. Neelie Kroes' speech described the importance of creating an open, competitive telecoms market, while Ed Richards set out Ofcom's views on the need to manage spectrum in a much more dynamic way than has been undertaken in the past:
"Ofcom’s approach to spectrum since our creation has the use of market mechanisms as its central premise. Many other regulators reached the same conclusion in parallel. The EU has made important moves towards liberalisation and promoted the use of market mechanisms."
He went on to criticse the reaction of the UK's mobile operators to Ofcom's proposals for auctioning 800MHz and 2.6GHz spectrum for the delivery of 4G mobile services:
"It has been very disappointing to witness the extent to which the incumbent mobile operators have chosen to entangle this process in litigation or threats of litigation. We recognise, of course, the need for companies to defend their commercial interests and to have recourse to the law in order to do so...But when litigation becomes essentially strategic rather than based on objective grounds, and when it has the effect of holding back innovation and hampering growth, it is legitimate to ask whether the overall legislative framework fully supports the public interest in this increasingly vital area...I think some major companies will have to reflect upon whether they have inadvertently jeopardised the benefits of objective, independent regulation in this area by virtue of their willingness to game the system. I am sure legislators would be all too willing to accept an argument which returns power in such matters to politicians, in light of the apparent inability of the current model to make timely decisions where the national interest is at stake."
He concluded that "straightforward long range planning will be replaced by adjustment and adaptation to the dynamism of technology and markets, combined with clear strategic coordination and pragmatism in delivery...these will be the defining characteristics of successful spectrum management." Further commentary from the Guardian, while this BBC article reports on some of the frustrations over the delays to the auction process and concerns over coverage.

A busy couple of weeks, all in all. Broadband policy announcements are a bit like buses it seems: loads come along all at once...