Thursday, August 30, 2012

Rural Broadband - Reframing the Debate


At the end of last month, the Plunkett Foundation and the Carnegie UK Trust published a new report calling for a new approach to delivering broadband for rural communities.

Rural Broadband - Reframing the Debate  aims to "bring a new angle to the rural broadband debate – focusing on how rural communities, inspired by the range of remarkable opportunities that high speed broadband can offer, can take greater ownership and leadership of this agenda in a range of different ways and play a central role in the provision of broadband services in their local area." This acknowledges the Government's target that 90% of premises in each local authority area should be able to access superfast (>24Mbps) broadband services by 2015, leaving the final 10% only able to access services offering a minimum speed of 2Mbps (the Government's universal service commitment, or USC).

This necessitates communities taking the initiative themselves if they are to secure faster speeds, according to the report; however it seems only a few are doing so at the moment:
"For many rural communities, solving the issue of high speed broadband provision can feel like an impossible problem. Due to the perceived complexity of the current technical broadband solutions, too few rural communities are being inspired at present to solve the broadband conundrum that they are facing. The knock on impact is that rural communities are not getting access to the community services that they want and need. As ever-increasing speeds of broadband provision become available in urban areas this problem of ‘digital exclusion’ is only going to be exacerbated for those remote rural communities who have little chance of accessing high speed broadband services in the short to medium-term."
A better approach would be to focus on inspiring and empowering communities:
"The Plunkett Foundation and the Carnegie UK Trust believe that governments and markets alone cannot meet the high aspirations of rural communities. Rural communities themselves, particularly in remote rural communities where distances are greater and the population more dispersed, must play a central role in achieving the services that they require. Therefore there is a need to reframe the rural broadband debate. We need to change from the current top down approach, where broadband solutions are not obvious to communities, to an approach that focuses on inspiring rural communities with what is possible using high speed broadband. A handful of community-led models are already in existence and working successfully across the UK, Ireland and internationally."
The report acknowledges that putting a broadband solution in place is far from straightforward for a community, but suggests that with the right support and guidance communities can do it themselves, citing the success of projects such as B4RN, Cybermoor and several others as examples of what can be achieved.

The report's recommendations include encouraging local authorities to investigate how their broadband infrastructures might be used to assist rural communities:
"…some public services, such as schools networks, have significant IT networks and some of these could potentially be used by communities as building blocks for establishing their own broadband infrastructure. Great Asby for example in Cumbria has developed wifi broadband that connects with high speed fibre broadband connections at the village school."
A similar approach has been taken in North Yorkshire and Hampshire - more on this here. Recommendations for Government include having "a clear strategy and commitment to providing long-term support for the development of community broadband solutions particularly for those rural communities at risk of not getting high speed broadband".

Wednesday, August 29, 2012

More on Everything Everywhere & 4G - part 2


Further to my previous post, there was more coverage of Ofcom's decision to allow Everything Everywhere to launch 4G services this year in advance of the forthcoming 4G spectrum auction in the Financial Times last week ("Everything Everywhere warns rivals on 4G"). The article suggests that any litigation from other operators in relation to Ofcom's decision could delay the auction and the launch of 4G services in the UK:
"...the decision met with criticism from rivals such as Vodafone and Three, which will have to wait to buy new licences in the next auction of frequencies. This has raised the prospect of litigation to reverse the Ofcom decision...this would cause Everything Everywhere to review its own legal position regarding the auction, with any legal objections to the process likely to delay 4G services for the UK even longer. Britain has already fallen behind other developed nations in its 4G plans, with operators in countries such as the US and Germany already rolling out superfast mobile services."
If no litigation from other operators is forthcoming, the company plans to launch services shortly:
"...the company would have 4G devices in shops this year if Ofcom is unopposed. (Olaf Swantee, chief executive of Everything Everywhere) said that it would first offer dongles that can be used to pick up 4G signals, with handsets expected to become available shortly afterwards... tests have so far proved that the 4G network would be “five to six times” faster than the 3G network “even with a lot of people on it”."
The company has run successful trials of the technology in rural areas, more on this here and here.

Recent developments in the USA provide an interesting comparison with the continuing question mark hanging over the rollout of 4G in the UK. Last week the Federal Communications Commission (FCC) approved the transfers of spectrum between Verizon Wireless and SpectrumCo, Cox, Leap, and T-Mobile, in a $3.6 billion deal which sees Verizon Wireless acquire almost 20MHz of spectrum (Verizon press release here). From the Financial Times ("Verizon spectrum deal gains approval"):
"Under the terms of the main transaction, Verizon Wireless, the largest US mobile operator by subscriber numbers, will acquire nearly 20MHz of spectrum from SpectrumCo, a joint venture that includes cable operators Comcast, Time Warner Cable, and BrightHouse, and additional spectrum in the same band from Cox Communications.Verizon Wireless will use the new spectrum to extend the rollout of its 4G wireless broadband network based on LTE technology."
The deal was conditional upon a number of factors, including the transfer of some of Verizon Wireless's spectrum to T-Mobile, one of its competitors, as well as enforceable commitments that Verizon Wireless should accelerate the buildout of its newly acquired spectrum, and offer data roaming on commercially reasonable terms and conditions. Specifically in relation to the buildout, from the FCC press release:
  • Within three years, Verizon Wireless will provide signal coverage and offer service to at least 30 percent of the total population in the Economic Areas or the portions of Economic Areas in which it is acquiring AWS-1 license authorizations (calculated by summing the population for each of these areas); and
  • Within seven years, Verizon Wireless will provide signal coverage and offer service to at least 70 percent of the population in each Economic Area in which it is acquiring AWS-1 license authorizations, or, where a portion of the Economic Area is acquired, to at least 70 percent of the population of the total acquired portion of the licensed Economic Area.
Earlier this year, another Financial Times article ("US rollout of LTE phone networks accelerates") reported that all four leading US mobile operators will have commercial LTE networks up and running by the end of 2013. Verizon Wireless (the largest US mobile operator by subscriber numbers) first launched its LTE network at the end of 2010, with rivals accelerating their deployments to remain competitive. This "reflects the accelerating adoption of smartphones and the emergence of the mobile internet as a real alternative to desktop internet access", according to the article.

If there are no further delays either to Everything Everywhere's deployment of 4G or the 4G spectrum auction process, we could see the first 4G services in the UK later this year from Everything Everywhere, with the first services from other operators using spectrum obtained via the forthcoming auction expected to be available in the second half of 2013.

Saturday, August 25, 2012

BDUK Prior Information Notice: Urban Broadband Fund - Super Connected Cities


The Department for Culture, Media & Sport (DCMS) has this week published a prior information notice (PIN) in the Official Journal of the European Union (OJEU) titled "Urban Broadband Fund - Super Connected Cities".

From the Procurement Portal website:
"What is a PIN? A PIN, or Prior Information Notice, is a notice published in the OJEU which sets out a contracting authority's purchasing intentions. It does not oblige the contracting authority to proceed with a procurement process, but informs the market that they should expect a procurement to be commenced within the next 12 months. Publishing a PIN is not mandatory unless the contracting authority is seeking to use a PIN to reduce procurement timescales. 
What is the point of publishing a Prior Information Notice (PIN)? Where a valid PIN has been published at least 52 days and not more than 12 months in advance of a contract notice, the contracting authority may shorten the timescales under both the open and restricted procedures. The shortest possible timescale available (without having to justify using an accelerated procedure) can be achieved by having a PIN in place, and ensuring that the OJEU notice and contract documents are in electronic form."
From the PIN:
"In its role as coordinator of the Urban Broadband Fund, BDUK (Broadband Delivery UK)  is publishing this PIN to help publicise the opportunities that may become available under this initiative. It is not anticipated that BDUK will be the contracting authority for these procurements, and that role will be undertaken by individual local authorities participating in phases 1 and 2. As the decision to authorise individual contracts remains that of each local authority, this PIN is being issued on a voluntary basis by BDUK, and does not indicate that any contracts will be procured or concluded within the next financial year. 
Responses to this PIN are invited from suppliers indicating their interest in either (A) or (B) or both (A) and (B) below: 
(A) Suppliers and any other parties interested in participating in any part of the supply chain for urban broadband projects and who wish to be included in any general consultations held by BDUK are welcome to respond to this PIN. Respondents need not indicate which cities they are potentially interested in. 
(B) Suppliers interested in acting as a contracting party with a Local Authority in the delivery of urban broadband projects are invited to respond to this PIN. Respondents should indicate which of the following areas they are interested in: (1) the delivery of ultrafast broadband and/or (2) the delivery of high speed wireless connectivity. Involvement in either (1) or (2) could include acting as a prime contractor, consortium lead or delivery partner. Respondents should indicate which cities they are potentially interested in. 
Where suppliers express an interest in potential projects in the eligible Phase 2 authorities, such interest will not be taken into account in BDUK’s selection process for Phase 2. Accordingly, suppliers should make no assumptions about which Phase 2 cities will be successful in receiving funding from this initiative."
From the additional information section of the notice:
"BDUK are co-ordinating this PIN on behalf of the individual projects and details of interested suppliers will be passed on to relevant Local Authorities. Individual Local Authorities may then contact suppliers as part of any on-going or future individual market engagement activities to ascertain potential market interest and to inform the development of the approach to projects. BDUK may also engage with suppliers to seek feedback on the wider Urban Broadband Fund initiative, including design elements likely to be common across multiple procurements, and will do so openly and transparently."
Responses are invited by 6th September 2012. More on super connected cities here and here; this process should benefit cities looking to procure broadband infrastructure and services using BDUK funding via routes other than BDUK's framework.

New broadband research & reports


The Department for Culture, Media & Sport (DCMS) this week issued a contract notice for a "UK Broadband Impact Study - Economic Model and Evaluation":
"The Department for Culture, Media and Sport (DCMS) would like to commission a suitably qualified contractor or consortium of contractors to undertake economic modelling and evaluation of the Government’s Broadband policy. The research project titled ‘The UK Broadband Impact Study - Economic Model and Evaluation’ will be split into two stages. This specification is for the first stage only; the Pre-Rollout Stage."
The deadline for submitting a response is 25th September 2012. Also this week, the Office of National Statistics (ONS) published its Internet Access - Households and Individuals report for 2012. Key findings include:
  • In 2012, 21 million households in Great Britain (80 per cent) had Internet access, compared with 19 million (77 per cent) in 2011
  • The number of households with Internet access has increased by 7.1 million (23 percentage points) since 2006, when directly comparable records began
  • In 2012, 93 per cent of households with Internet access used a fixed broadband connection, of which 30 per cent used a cable or fibre optic connection
  • Of the 5.2 million households without Internet access, the most common reason for not having a connection was that they 'did not need it' (54 per cent)
  • In 2012, 67 per cent of adults in Great Britain used a computer every day
Coverage from ISP Review focuses on the adoption of different broadband technologies by location, highlighting the limited availability of superfast services in rural areas. From the ONS report:
"The 2012 estimates show that geography has a significant effect on how households connect to the Internet. DSL broadband was the dominant type of connection in all communities. In rural areas nearly eight in ten households (78 per cent) connected to the Internet using a DSL broadband connection and 12 per cent via cable or fibre optic broadband. However, for households in cities and urban areas, DSL broadband was less dominant with only 49 per cent connecting this way and 36 per cent connecting via cable or fibre optic broadband. This suggests, unsurprisingly, that fibre optic technology is being rolled out to urban communities earlier than rural areas as it can reach more people for the initial investment."
In the USA, the Federal Communications Commission (FCC) has published its eighth Broadband Progress Report: Congress in Section 706 of the Telecommunications Act of 1996 requires the FCC to report annually on whether broadband “is being deployed to all Americans in a reasonable and timely fashion.” From the FCC press release:
"The nation has made significant progress expanding high-speed Internet access in recent years, but further implementation of major reforms newly adopted by the Federal Communications Commission is required before broadband will be available to the approximately 19 million Americans who still lack access...to fixed broadband service at threshold speeds.  In rural areas, nearly one-fourth of the population —14.5 million people—lack access to this service.  In tribal areas, nearly one-third of the population lacks access. Even in areas where broadband is available, approximately 100 million Americans still do not subscribe. The report concludes that until the Commission’s Connect America reforms are fully implemented, these gaps are unlikely to close. Because millions still lack access to or have not adopted broadband, the Report concludes broadband is not yet being deployed in a reasonable and timely fashion."
The full report is available here with mapping here. This is the first such FCC progress report to include extensive data on mobile broadband and the availability of next-generation, high-speed services. From paragraph 92 of the full report:
"Higher-speed broadband (10 Mbps and above) is increasingly available in many areas of the country. We must keep in mind these developments as we assess the current market and project consumer demand and expectations in the future. For example, cable providers have made much progress on rolling out DOCSIS 3.0, which is capable of 100 Mbps speeds and even higher speeds. And, Americans continue to demand and subscribe to higher services. We will examine in the next Inquiry whether we should identify multiple speed tiers in these reports to assess the country’s progress toward our universalization goal, as well as additional goals—such as affordable access to 100 Mbps/50 Mbps to 100 million homes by 2020. These higher speeds are important as we have seen that greater bandwidth allows for greater utilization of higher data speeds by innovators at the edge of the networks, which in turn drives greater demand and utility of broadband."
89.3% of Americans access 10Mbps speeds, 63.8% can access 25Mbps, 54.7% 50Mbps and 26.9% can access 100Mbps. Some concerning findings in relation to broadband services for US schools in paragraphs 131-134:
"As many as 80 percent of E-rate recipients say that their broadband connections do not fully meet their needs, and 78 percent of recipients say that they need additional bandwidth...We lack comprehensive data regarding the actual or desired level of broadband service in our nation’s elementary and secondary schools. NTIA has stated that, “based on studies by state education technology directors, most schools need a connection of 50 to 100 Mbps per 1,000 students.” While school systems will need speeds substantially faster than the speed benchmark, we find, based on SBI Data, that providers offer download speeds of at least 25 Mbps to only 63.7 percent of the nation’s schools, suggesting that many schools may not have a sufficient level of broadband service...it continues to appear that many schools and classrooms are underserved by broadband today."
The Information Technology & Innovation Foundation (ITIF) challenge the report's conclusion that "broadband is not yet being deployed in a reasonable and timely fashion" across the USA:
"...America's broadband infrastructure is moving in the right direction, and is doing so at a reasonable and even commendable rate. Average broadband connection speed in the United States has risen from 22nd to 15th in the last two years according to Akamai, a majority of the world's LTE users are in the United States, and LTE networks are beginning to reach rural areas where the best wired options fail to meet the FCC's own definition of true broadband service...A holistic analysis of the U.S. broadband infrastructure must reach the conclusion that we're making "reasonable progress" as a nation."
More criticisms of the FCC report here. Finally, David Belson of Akamai (which produces the quarterly State of the Internet report), has in two blog posts (part 1 here and part 2 here) published an analysis and comparison of speed and coverage targets around the world. Some key findings:
  • ...not every country has developed a National Broadband Plan, or at least hasn't published one publicly.  Venezuela and Hong Kong, among others, were no-shows...
  • Some countries explicitly defined "broadband" as connections of at least a specific download (and sometimes upload) speed, setting adoption targets and timelines for those speeds, as well as higher speeds.
  • In contrast, some countries appeared to simply aim for "broadband adoption" targets, without actually defining "broadband" within the plan...
  • Geography was recognized as a key factor in broadband deployment and adoption in a number of countries, where they set out unique targets for urban or rural households, or cities and the countryside. Similarly, countries often set out unique targets for households, educational institutions, health centers or hospitals, and government facilities.
Coverage from ISP Review here.

Thursday, August 23, 2012

More on Everything Everywhere & 4G


Further to Ofcom's announcement earlier this week that Everything Everywhere would be allowed to launch 4G services using its existing spectrum holdings in advance of the forthcoming spectrum auction, the company has published  its response on its website.
"Ofcom’s decision to make 4G available this year is great news for the UK. Consumers will soon be able to benefit from the much greater mobile speeds that 4G will deliver. 4G will drive investment, employment and innovation and we look forward to making it available later this year, delivering superfast mobile broadband to the UK."
From Everything Everywhere's 4G factsheet (available in the press pack, downloadable at the previous link):
"4G will enable people to download apps more quickly and get what they want instantly on the move, with speeds 5-7 times faster than what you see today on 3G by 2014...In addition to faster internet, 4G networks can carry much more data so that the mobile networks can better serve the increased number of people using the internet on their mobiles or using mobile broadband dongles."
The company has also announced that it plans to launch a new brand later this year, to sit alongside its existing Orange and T-Mobile brands, and a new report from its 4G trial in Cumbria is available here (with more on this here). In its coverage Ofcom's decision, the Financial Times reported on the reactions of other operators ("Everything Everywhere gets 4G go-ahead"):
"The decision to allow Everything Everywhere to roll out 4G caused an outcry among its rivals, who say that it will have an unfair advantage as the only provider until after the auction. A Vodafone UK spokesman said it was “frankly shocked” that Ofcom had reached the decision. “The regulator has shown a careless disregard for the best interests of consumers, businesses and the wider economy through its refusal to properly regard the competitive distortion created by allowing one operator to run services before the ground has been laid for a fully competitive 4G market.”"
The Financial Times also provided further details of Everything Everywhere's plans for its new brand ("Everything Everywhere plans new brand"), suggesting that 4G services may be available very soon:
"Everything Everywhere declined to comment on the new brand name but it is expected to refer to its forthcoming 4G services prominently, given the importance that the group’s management has given to the launch of these mobile broadband services. The company has already registered trademarks for several names using 4G in different ways. The group could begin selling devices that use its 4G network as early as November, which would give it several months’ head start on rivals that will have to wait to buy other 4G spectrum at an auction at the end of the year."
Finally, ISP Review reported that, as anticipated, Everything Everywhere has agreed to sell some of its  1800MHz spectrum to Three UK, as a condition of the original Orange UK and T-Mobile merger in May 2010, though the company will not divest itself of this spectrum until September 2013.

Tuesday, August 21, 2012

Jeremy Hunt: "to be the best you need to be the fastest"


In a speech yesterday, Jeremy Hunt, Secretary of State for Culture, Olympics, Media and Sport, reiterated his commitment to the UK's broadband strategy.

In many regards, his speech was a direct response to the criticisms set out in the recent House of Lords report on the Government's approach (more on the HoL report here). One such criticism was that the Government has prioritised speed over coverage, disadvantaging areas outside the target for superfast broadband to be available to 90% of UK premises by 2015, as exemplified by the following extracts from the HoL report:
  • Government policy has become preoccupied with the delivery of certain speeds to consumers. This, in our view, has had a detrimental effect on policy-making and the long term national interest.
  • The delivery of certain speeds should not be the guiding principle; what is important is the long term assurance that as new internet applications emerge, everyone will be able to benefit, from inhabitants of inner cities to the remotest areas of the UK.
  • ...it should be a fundamental principle of broadband policy that whatever measures are undertaken to enhance or extend its availability, they strive to bring about equality of opportunity to access broadband across all communities in the UK.
  • ...future broadband policy should not be built around precise speed targets end-users can expect to receive in the short-term, however attractive these may be for sloganeers.
  • We urge the Government to reconsider using speed targets to define the goals of their broadband policy. This would allow them to be more flexible with regard to the technologies used to provide enhanced connectivity, particularly to outlying communities.
However, Jeremy Hunt remains unrepentant on the importance of speed:
"Because of the scale of this opportunity, I have always prioritised this part of my agenda at DCMS. In my very first speech as a Minister I said that I wanted us to have the “best” superfast broadband network in Europe by 2015.  In defining “best” you include factors like price and coverage as well as speed. But over the past two years it has become clear, as Usain Bolt wouldn't hesitate to say, to be the best you need to be the fastest. So I am today announcing an ambition to be not just the best, but specifically the fastest broadband of any major European country by 2015."
Similarly, from later in the speech:
"Probably the best characterisation of my broadband policy has been a relentless focus on speed. Let me explain why. My nightmare is that when it comes to broadband we could make the same mistake as we made with high speed rail. When our high speed rail network opens from London to Birmingham in 2026 it will be 45 years after the French opened theirs, and 62 years after the Japanese opened theirs. Just think how much our economy has been held back by lower productivity for over half a century. We must not make the same short-sighted mistake."
Interesting to see the reference to HS2: there has been much criticism that the money being allocated to HS2 would be better spent on broadband (see here for an example from last years NextGen conference) - an attempt to head off future criticism along these lines (so to speak), by stating the importance of and the Government's commitment to both? The Culture Secretary went on to rebut still further the criticism that the UK's broadband policy is speed-obsessed:
"Which is why when the Lords Committee criticised me this summer for being preoccupied with speed, I plead guilty. And so should we all. Because we simply will not have a competitive broadband network unless we recognise the massive growth in demand for higher and higher speeds. But where their Lordships are wrong is to say my focus is on any particular speed: today’s superfast is tomorrow’s superslow. Just as the last government was wrong to hang its hat on 2 Mbps speeds, we must never fall into the trap of saying any speed is “enough.” That is why, although we have loosely defined superfast as greater than 24 Mbps, I have also introduced a programme for ultrafast broadband in our cities that will offer speeds of 80-100 Mbps and more. And we will continue to develop policy to ensure that the highest speeds technology can deliver are available to the largest number of people here in the UK."
So the >24Mbps figure is "loosely defined". Ofcom's latest research into UK fixed-line broadband speeds found a similar looseness in relation to ADSL2+ services which are theoretically capable of delivering up to 24Mbps: these are now frequently being advertised as offering up to 16Mbps instead.

Jeremy Hunt also hit back at the HoL's criticism that the Government is preoccupied with fibre to the cabinet (FTTC) solutions: "They suggest that fibre to the cabinet is the sum of the government’s ambitions." But I'm not sure the the HoL report does suggest this, in fact? The main argument set out in the HoL report is that the UK's broadband strategy should be based upon a detailed assessment of and proper planning for the kind of broadband infrastructure the UK needs. To this end, it makes the case for a national network of open access fibre-optic hubs:
"…our vision is of a robust and resilient national network linked primarily by optical connectivity, bringing open access fibre-optic hubs into or within reach of every community. This would allow diverse providers, large and small, to contribute to the reach and resilience of our national connectivity and allow all individuals to benefit from whichever services, including public ones, will run over it in time to come...our view is that:  
i) Every community should be within reach of an open access fibre-optic ‘hub’; 
(ii) Every such hub should be fed by ample fibre-optic cable, providing open access to optical links back to the exchange, and back to the public internet—which will not be free, but made available on fair, reasonable and non-discriminatory terms, allowing third parties to build their own local access networks meeting appropriate technical standards, using whichever technologies they choose, from that hub; 
(iii) At the very least, we expect a hub to be able to provide backhaul for a wireless network, where there is demand, so that premises would be able to gain access to a wireless internet service from at least one of these hubs—assuming they can afford to do so."
The HoL report does stress the importance of fibre to the premise (FTTP) to inform the future direction of the UK's broadband policy, acknowledging that current constraints prevent its universal implementation in the current climate:
"We anticipate and recommend that policy should be ultimately directed towards universal, point-to-point FTTP as this is a technology not only able to accommodate current demand, but at current rates of growth, will be able to accommodate the UK’s bandwidth demands for many decades to come. 
In this sense, we recommend that the Government should set out an even bolder vision for broadband policy than is currently the case. 
Given the impossibility, with current constraints on resources, of rolling out universal point-to-point FTTP, we recommend that Government policy should, as an intermediate step, aim to bring national fibre-optical connectivity—which would include, as a minimum, fully open access fibre backhaul—within the reach of every community. This will provide the platform from which basic levels of service can be provided to all, and an improved service where there is sufficient demand.
As a point of principle, we believe it is incumbent on the Government to ensure that policy and regulation in the interim guarantee that there is a clear path from any intermediate steps which may be taken to the roll-out of point to-point FTTP and that, crucially, these steps will not serve to hinder or hold back any future upgrade."
...which reads to me as suggesting that a new approach is needed, not that FTTC is the sum total of the Government's intentions. I would venture that this extract from Jeremy Hunt's speech is a direct response to the concept of a network of open access fibre-optic hubs reaching every community set out in the HoL report:
"Let’s look at the alternative: if the state were to build a fibre to the home network now, it would potentially cost more than £25 bn. It would also take the best part of a decade to achieve. We will get there far more cheaply – and far more quickly - by harnessing the entrepreneurialism of private sector broadband providers than by destroying their businesses from a mistaken belief that the state can do better."
However, in my view, the HoL report doesn't suggest that the state should build a fibre to the home network now, and it also recognises the importance of the private sector and a competitive marketplace:
"..this line of analysis, could prompt calls for nationalisation, and these might well have been deafening in a different era. Curiously, and as a matter of fact, we note that there have been calls, not for nationalisation, but for dispensing with competition and handing to Openreach the necessary public money and the entire job of rolling out fibre. 
We note, however, that one of the advantages of focusing policy around the  promotion of open access fibre-optic hubs, as we recommend, is the credible introduction of competitive pressure to invest in local access networks for the  long term. Public subsidy should therefore be used to roll out open access fibre-optic hubs to within reach of every community; the local access network, given a reformed regulatory and policy backdrop...then becomes a different economic phenomenon to the rest of  the network and one in which competition, and indeed community involvement would be newly stimulated. Under such an approach, it would be possible for technical enhancements to be introduced without specific, centralised mandates for speeds or any other quality, for which demand may only exist in the future. With the middle mile within the reach of individuals and communities, such decisions can be made locally. They can, through the operation of the market, choose the kind of final link or drop which they want themselves and upgrade this flexibly as and when they choose to, or there is need to do so."
The HoL report also suggests that relying on the private sector brings its own set of risks, particularly in relation to the amount of competition in the current marketplace:
"...the danger that results from the lack of competitive pressure in the construction of the UK’s broadband infrastructure lies in the fact that the Government can easily find itself in thrall to the commercial interests of private enterprise, and therefore unable to direct broadband infrastructure in the wider interests of the UK.  
We urge the Government, therefore, to recognise as a general principle that it will be vital to monitor the dominant, national providers vigilantly and to deploy appropriate incentives to ensure they, and the market in which they operate, behave in the public interest as this will not necessarily follow automatically from competitive pressures alone."
In closing, Jeremy Hunt stated that he expects state aid approval to be gained this autumn, after which local procurements will be able to roll out with the view to the majority of projects being complete by 2015. Funding for the Tier 1 cities that have applied for the Urban Broadband Fund will be confirmed in September 2012 with the successful Tier 2 cities being announced later in the autumn.

Coverage of the speech from the BBC here, ISP Review here, Computer Weekly here and the Guardian here.

Ofcom allow Everything Everywhere to launch 4G services


Following a consultation earlier this year (more here), Ofcom have today allowed Everything Everywhere to launch 4G services using its existing spectrum holdings in advance of the 4G auction later this year. Everything Everywhere, which has previously conducted trials of the technology, will be able to launch services from 11 September 2012.

Ofcom considers that the benefits to consumers outweigh any risk of distorting competition by allowing Everything Everywhere to proceed in this way. From Ofcom's press release:
"Varying EE's licences would allow EE to provide better quality data services to consumers, for example with higher speeds and lower latency, than can be offered by operators using 3G technologies and existing spectrum holdings. Accordingly, we expect that consumers that choose to take EE's LTE service will derive benefits that they would not otherwise enjoy were we not to vary EE's licences now. 
Although we consider it likely that EE will enjoy a competitive advantage during the period before other operators are able to launch their own LTE services, we consider on the evidence available that any such advantage is unlikely to result in an enduring advantage which distorts competition to the detriment of consumers. Our assessment takes account of the impending release of additional spectrum in the 800 MHz and 2.6 GHz bands which will enable other operators to launch competing LTE services during the course of 2013. We have also taken into account EE's obligation to divest itself of some its 1800 MHz spectrum. 
In light of this assessment, and for the reasons explained in more detail in this decision, we consider that it is in the interests of consumers for us to vary EE's licences now, in accordance with EE's request. We have therefore today issued EE with varied 1800 MHz licences with the provisions authorising LTE and WiMAX coming into force on 11 September 2012."
Coverage from the BBC here, ISP Review here, the Register here and the Telegraph here. It was reported yesterday that final agreement of the sale of some of Everything Everywhere's spectrum to rival operator Three was imminent. This from the Guardian:
"Ofcom said in March it was "minded" to approve liberalisation of the 1800 band, currently licensed for 2G and 3G services. However, after protests from rivals that EE would have an unfair first mover advantage, it extended the consultation period. EE had originally hoped to have its service running this autumn, having applied for liberalisation last November. 
Ofcom is thought likely to approve EE's request, although it may impose conditions such as a later launch date than the company is hoping for. 
Meanwhile, sources have confirmed that EE is on the verge of announcing a deal with Three, owned by Hong Kong conglomerate Hutchison Whampoa. The European commission had ordered EE to sell a quarter of its 1800 holding as a condition of approving the T-Mobile/Orange merger. 
Vodafone and O2 also bid for the spectrum, but it is thought they have missed out. The sale, arranged by EE's financial adviser Morgan Stanley, would not necessarily allow Three to launch 4G this year. This is because EE is not obliged to clear the spectrum until September 2013."
From the Financial Times yesterday ("Everything Everywhere in spectrum talks"):
"Everything Everywhere is in advanced discussions to sell part of its crucial spectrum holdings capable of carrying next generation 4G mobile services to Three...The deal would give Three guaranteed ownership of rare spectrum that can carry superfast 4G mobile broadband, and potentially at a lower price than bidding against its three rivals in the much delayed auction of lower frequency 4G spectrum pencilled for the end of the year by Ofcom...Those with knowledge of the discussions cautioned the deal had not been finalised, but one added that an agreement was “imminent”."
Similar coverage in the Telegraph.

Friday, August 17, 2012

Ofcom: UK fixed-line broadband performance


Earlier this week, Ofcom published the latest findings from its research into UK fixed-line broadband performance and speeds. From its press release:
"The continuing trend of increasing speeds recorded in the research confirms that consumer migration to faster services is gathering momentum."
...albeit a fairly gentle momentum it would seem:
"The proportion of broadband connections which are superfast (i.e. they have an advertised speed of ‘up to’ 30Mbit/s or above) has increased in recent months with the launch of new superfast packages. By May 2012, 8% of residential broadband connections were superfast, compared with 5% six months previously and 2% in May 2011. Residential superfast broadband connections are also getting faster, with average speeds increasing from 35.5Mbit/s in November 2011 to 35.8Mbit/s in May 2012."
The price differential between current and next generation (superfast) services is small. From Ofcom's overview of UK broadband speeds:
"The difference between the monthly rental fees for ISPs lowest-cost superfast services and their lowest-cost current generation services (which have headline speeds below 'up to' 30Mbit/s) is often relatively small, with the price differential ranging from £5 to £10 a month for most ISPs which offer both types of service. This, coupled with increasing demand for higher-speed connections as consumers use more bandwidth-hungry services and the number of connected devices per household increases, resulted in the proportion of residential fixed broadband connections that were superfast increasing from 5% to 8% in the six months to May 2012."
Download speeds from BT and Virgin Media are impressive:
"Of the 12 ISP packages included in the report, Virgin Media’s ‘up to’ 100Mbit/s service was the fastest, with the research revealing average actual speeds of 88.3Mbit/s over a 24 hour period. Of the other superfast packages included in the research, the average download speed on BT Infinity’s ‘up to’ 76Mbit/s service was 58.5Mbit/s3, compared with Virgin Media’s ‘up to’ 60Mbit/s at 55.9Mbit/s. BT’s ‘up to’ 38MBit/s package achieved speeds of 32.2Mbit/s3 whilst Virgin Media’s ‘up to’ 30Mbit/s service had average speeds of 30.1Mbit/s. During busy peak periods, a higher proportion of Virgin Media cable customers experienced speeds of less than 90% of their average maximum speed, compared to BT Infinity fibre customers."
The overview highlights the even greater difference between upload speeds across current and next generation broadband services:
"The research found that BT Infinity’s ‘up to’ 76Mbit/s service delivered the highest upload speeds of all the packages, averaging 15.6Mbit/s. Among the ADSL2+ packages included in the research, O2/Be’s ‘up to’ 20/24Mbit/s service provided the fastest average upload speeds at 1.1Mbit/s."
The full report explains the growing importance of upload as well as download speeds:
"Broadband connections work both ways, and have an upstream as well as a downstream direction. While broadband advertising tends to focus on download speeds (which are important for most consumer applications), upload speeds matter to those looking to share large files, use real-time two-way video communications and for some online gaming. We therefore also consider upload speeds in our research."
The overview provides further evidence that the current UK definition of superfast broadband as delivering above 24Mbps may be misplaced, as suggested in the recent House of Lords report on UK broadband strategy:
"...ADSL2+ services, which were previously often promoted using the technology’s maximum theoretical speed of ‘up to’ 24Mbit/s (which was rarely achieved in practice), are now frequently being advertised as ‘up to’ 16Mbit/s. Some ISPs have moved away from promoting their services primarily on the basis of speed focussing instead on price, or added value features such as free security."
Interesting that Ofcom is now using 30Mbps as the basis for defining superfast services, in line with the European Digital Agenda targets for 2020. The full report elaborates on this point:
“As regards advertising and headline speeds, we have observed that ISPs have changed the way they advertise their broadband services since new CAP and BCAP guidance on broadband speed claims in advertising came into force on 1 April 2012. For example, Plusnet’s ADSL2+ service is now advertised as being ‘up to’ 16Mbit/s (rather than ‘up to’ 20Mbit/s as it was previously) while BT’s basic fibre-to-the-cabinet (FTTC) service is now advertised as being ‘up to’ 38Mbit/s (rather than ‘up to’ 40Mbit/s as it was previously). In fact, some ISPs no longer advertise their services on the basis of speed, instead focussing on price or added value features such as free security software.”
The overview's footnotes explain that FTTC average speeds reported by Ofcom's research dropped, partly due to an issue affecting some panellists’ BT Home Hub routers during the testing period but possibly as the result of another reason too: average speeds may continue to decrease in the future as BT's roll-outs continue. This is due to the connection of more sparsely populated areas where distances between street cabinets and customers' premises are greater:
"It is possible that the drop in speeds might also be explained by the continuing rollout of FTTC services to less densely populated areas. Although fibre to the street cabinet delivers much faster broadband services, as with ADSL technology, the greater the distance between the home and the street cabinet, the slower the speed."
Again,the full report provides more detail:
"...it is possible that one factor behind falling average FTTC speeds in the six months to May 2012 (which occurred despite the introduction of ‘up to’ 76Mbit/s retail services in April 2012) is the continuing rollout of FTTC services. As FTTC coverage increases it will extend to less densely-populated areas, where the average distance from the street cabinet to the exchange will tend to be greater. As is the case with ADSL services, the speed provided by the VDSL technology, which is used to transmit data from the street cabinet to the end user’s premises in an FTTC deployment, declines as the length of the copper cable increases, meaning that average FTTC speeds are likely to fall slightly as roll-out reaches more rural areas."
Coverage from ISP Review here, ThinkBroadband here and the BBC here.

House of Lords broadband report - analyst views & commentary


Both Analysys Mason and Ovum have published their analyses of the proposals set out in the recent report by the House of Lords Communications CommitteeBroadband for all: an alternative vision. The Independent Networks Cooperative Association (INCA) and the Country Land & Business Association (CLA) have also published statements in response to the report.

Analysys Mason focuses its comments on the report's proposals for "a robust and resilient national network linked primarily by optical connectivity, bringing open access fibre-optic hubs into or within reach of every community." Analysys Mason offers some insight into what such an approach might cost, in the absence of any costings in the report, based on their previous calculations for the Broadband Stakeholder Group in September 2008:
"If the Government were to start by building open-access hubs to serve the most rural 10% of the UK – i.e. the part that is least likely to receive superfast broadband under existing broadband plans of local authorities – and if we assume that each hub serves around 300–400 premises (roughly the same number as an existing BT cabinet), then the total cost would be of the order of GBP1 billion. This figure does not include the cost of linking the hubs to each of the premises they are designed to serve."
Clearly if it would cost around £1 billion for the final 10%, extending the approach to include more of the UK would cost a lot more. The statement goes on to point out that this figure is significantly more than the amount of public funding that has been committed by Government in support of the roll-out of superfast broadband across the UK. Analysys Mason believes that little additional public or private funding is likely to be forthcoming, and that such an approach risks delaying further private investment:
"Some additional funding may be available at the European Union level, but it seems unlikely that the operators themselves would contribute to the construction of a new open-access dark fibre network, as they would risk damaging the value of their own existing networks. Furthermore, the proposals might delay the roll-out of commercially funded networks, as operators would be likely to wait to see in which areas their planned infrastructure could be duplicated."
Both ISP Review and ZDnet reported on Analysys Mason's statement. Ovum similarly acknowledges the lack of costings in the report, suggesting in its statement that its proposed solution "has already been dismissed as unworkable." Its statement also claims the report fails to take account of the fact that "access to BT’s network (both copper and fiber) is already available on equivalent and non-discriminatory terms and that winners of government funding must provide open wholesale access to their networks", in its analysis of the reasons for the apparent lack of competition in the marketplace.

In fairness, the House of Lords report does acknowledge the availability of Virtual Unbundled Local Access (VULA) in the form of Openreach's Generic Ethernet Access (GEA), a wholesale  product in both FTTC (fibre to the cabinet) and FTTP (fibre to the premise) versions. ISPs can buy this service from Openreach as an implementation of the VULA requirement established by Ofcom to address the impracticability of Openreach offering full physical unbundling over its fibre local access networks. The report notes that GEA fails in what it regards as a particularly important aspect preventing smaller providers from competing locally with those with national scale:
"The most important criterion which GEA fails to meet—quite fundamentally—is the first (that the standards be open and industry-led) which, by extension, means that it cannot meet the second (be  universally adopted). GEA is a closed, proprietary specification."
The House of Lords report suggests that a set of appropriate alternative open standards already exists:
"While it is outside the scope of this report to define precisely what an open  set of standards should specify, a set of industry-defined standards does already exist which, in our view, provide a very good model. These are the Active Line Access standards (ALA) fostered by Ofcom and defined by the UK’s Network Interoperability Consultative Committee (NICC), a technical forum for the UK communications sector that develops interoperability standards for public communications networks and services in the UK. They are designed to provide a standard interface marrying the needs of  Communications Providers and Infrastructure providers in the UK..."
The report asserts that the ALA standards meet all of the necessary criteria except "universal adoption", going on to suggest that:
"...the universal adoption of an open set of standards like Active Line Access is absolutely crucial in enabling local access network providers without national scale to compete with large-scale national networks like that of Openreach which envelope many parts of the country, and at present apply their own exclusive, proprietary specification, inaccessible to others."
In summary, "ALA seems to provide a good initial standard, and a good model for the open standardisation process which is manifestly required." Returning to Ovum's analysis, it goes on to suggest that the Government should not be criticized for "giving time for market forces to play out", even if it has done so rather inadvertently as a result of delays in Broadband Delivery UK's processes, as this demonstrates that "the private sector is still willing and able to roll out next-generation broadband services to parts of the country that were originally thought of as underserved".

Ovum's statement also criticizes the House of Lords report for failing to address properly the importance of mobile technologies to the UK's broadband future and for suggesting that TV broadcasts should in future be delivered entirely by IPTV without considering fully the impact this would have on both bandwidth requirements and investment incentives.

Ovum suggests that "policy-makers should consider the possibility of mobile operators using existing passive infrastructure for backhauling mobile" and that the infrastructure sharing obligations placed on BT should be extended to other communications providers. Finally, Ovum suggest that a disconnect between Ofcom and the Government has emerged in recent years which needs to be addressed if the UK's broadband upgrade is to get back on track, particularly in relation to the forthcoming 4G spectrum auction.

INCA's statement is supportive of the report, welcoming its highlighting of the importance of open standards and open access and the re-introduction of the concept of local community fibre hubs, something considered in the Government's strategy document Britain's Superfast Broadband Future but largely absent from subsequent policy developments. Inclusiveness is key to future success:
"Many private sector players and communities have the capability and capacity to make a significant contribution to ensuring that we build a genuinely future-proofed next generation network; a 'transformational digital infrastructure' capable of supporting new generations of digital services and the people and businesses that create them. It is important that we adopt an inclusive approach to ensure we get it right."
The Country Land & Business Association statement also welcomes the House of Lords report, particularly its focus on coverage and inclusiveness above speed. However the statement takes issue with the report's assertion that fibre optic technologies are the best option:
"The CLA advocates a patchwork quilt model that uses the most appropriate technologies for a certain area, rather than using a single technology. An over-reliance on a single model is limiting the Government's chance of meeting its 2015 deadlines to provide superfast broadband of at least 24 Mbps for 90 percent of premises, and its commitment to deliver two Mbps to all rural areas."
Finally, it would appear The Register is far from convinced by the report..."Do sheep really need Twitter? And must we pay for their Tweets?"

Thursday, August 16, 2012

Google Fiber update


Some interesting commentaries in the press on the Google Fiber project since its launch last month. Business Insider describes the initiative as "the most disruptive thing the company's done since Gmail". The project exposes how slow the incumbents have been to innovate; that Google is not undertaking the project as a loss-leader and intends to make money from the programmes is particularly noteworthy in this regard. This is also explored in an article on GIGAOM:
"...Google’s goal is to bring the same efficiencies that have helped create cheaper, smaller and more powerful computers and create a cost and improvement curve for broadband access that resembles the curves for compute storage...Google may have a found a way to do that — both in terms of constructing and operating a fiber to the home network — by using its engineering team, existing consumer technologies such as QR codes and social engineering to influence how users sign up for access."
Google's innovative approach to demand registration is key here:
"...to reduce the cost of the actual last mile to users’ homes(Google is) telling people in Kansas City that if they want to be the first to get fiber, they’ll have to convince their neighbors to sign up. The goal is to get a critical mass of between 5 percent and 25 percent of the homes in a given neighborhood (Google calls it a fiberhood) committed to signing up for Google Fiber before ever sending out technicians. Residents have until Sept. 9 to get their fiberhood on the leaderboard before Google starts rolling out its fiber."
Google has also built its own infrastructure and devices for the project (including routers and set-top boxes), all of which contributes to delivering a gigabit per second service to homes at a profit. Interestingly, another GIGAOM article highlights three disappointments from the launch of Google Fiber: that it's network won't be open, the company hasn't shared the details of how its project will operate at a profit and that it potentially gives Google a lot of control and information about users and their online behaviours.

There have been several updates to the Google Fiber Blog since the launch:
The main set of FAQs on the Google Fiber site provide more information about fiberhoods and the registration thresholds each much reach to be successful:
What is a fiberhood? A fiberhood is a portion of Kansas City, KS or Kansas City, MO that includes about 250-1,500 households. We determined fiberhood boundaries based on a number of factors. First, we worked with the Kansas City governments and community leaders to learn about pre-existing neighborhoods or communities. Then, we looked at those communities and determined very clear boundaries at their edges like streets and parks.
What is the fiberhood pre-registration goal? The pre-registration goal is the percentage of homes in your fiberhood that need to pre-register before your fiberhood qualifies for service. Since fiberhoods vary in ease of construction, the number of pre-registrations required per fiberhood varies from 5% of homes to 25% of homes. You can check out your fiberhood’s pre-registration goal here
How did you decide the fiberhood pre-registration goals? Like many of our projects at Google, we relied on data. All fiberhoods are different. They range in size and density as well as speed and ease of Fiber construction. For example, houses that are spread out (like in the suburbs) require more time, fiber and labor, and therefore are more difficult to connect than homes in a dense urban environment. So, in those fiberhoods that are more complicated to build, we want to make sure that enough residents will want Fiber service. Taking that into account, we determined fiberhood pre-registration goals by grouping fiberhoods into three tiers:
  • Fiberhoods that have a 5% goal. Typically, these areas will be easy to build and install.
  • Fiberhoods that have a 10% goal. Typically, these areas will be more complicated to build and install.
  • Fiberhoods that have a 25% goal. Typically, these areas will be the most complicated to build and install.
The fiberhood rankings show there has been significant interest already. In Kansas City, KS 15 of 74 fiberhoods have achieved the necessary registrations already (with more than three weeks to go before the deadline), with many more approaching their threshold. The number in Kansas City, MO is higher, with 52 of 128 fiberhoods having already reached their targets as of this afternoon. Fiberhoods vary significantly in size, so more effort will (I guess) be required to galvanise larger communities to register, but still impressive stuff all the same (more here).

This takeup is reported in articles in USA Today and the Kansas City Star, with this second article noting that many public buildings like schools and libraries risk missing out on connectivity if their fiberhoods do not reach their registration threshold (more on this herehere and here).

Finally, some fun animations here and the official Google Fiber YouTube channel is here.

Broadband for all: an alternative vision


At the end of last month, the House of Lords Communications Committee published the findings from its inquiry into the UK's broadband strategy (more here, including a link to the oral and written evidence received by the Committee).

The main recommendation of Broadband for all: an alternative vision can be summarised as "if I was going there, I wouldn't start from here". It argues that current UK Government broadband policy should start from first principles and fails to address this fundamental question:
"What should the UK’s broadband infrastructure look like in view of its place as a major strategic asset, at least on a par with the UK’s roads, railways and energy networks?"
Instead, current policy focuses on using public funding to extend the reach of commercial provision and plans into areas the market will otherwise not reach (i.e. encourage suppliers to do more of what they're already doing), rather than being based upon a detailed assessment of and proper planning for the kind of broadband infrastructure the UK needs. Such a strategic focus on the sort of network the UK requires, rather than the sort of network the market is currently prepared to provide, is paralleled by the approach taken in Australia in my view. From the report's summary:
"Fundamentally, the Government’s strategy has fundamentally focused on the wrong part of the network—broadly speaking the outer edge and the margins, not the centre. We argue that the Government should be focusing on delivering a high spec infrastructure which is future proof and built to last; fibre-optic cable, the most future proof technology, must be driven out as close as possible to the eventual user. Then, as well as mandating open access to this optical fibre from the cabinet to the exchange, we need to ensure that there is open access to links between the exchanges that feed the cabinets, and to the higher level links into national and global networks. Just as there is national planning for the national, regional and local hubs of our transport network, so there should be national planning for a communications network of local, regional, national, and internet exchanges where different operators can site equipment and exchange traffic, all linked by ample optical fibre that is open to use by competing providers."
The report makes the case for a national network of open access fibre-optic hubs:
"…our vision is of a robust and resilient national network linked primarily by optical connectivity, bringing open access fibre-optic hubs into or within reach of every community. This would allow diverse providers, large and small, to contribute to the reach and resilience of our national connectivity and allow all individuals to benefit from whichever services, including public ones, will run over it in time to come...our view is that: 
i) Every community should be within reach of an open access fibre-optic ‘hub’; 
(ii) Every such hub should be fed by ample fibre-optic cable, providing open access to optical links back to the exchange, and back to the public internet—which will not be free, but made available on fair, reasonable and non-discriminatory terms, allowing third parties to build their own local access networks meeting appropriate technical standards, using whichever technologies they choose, from that hub;
(iii) At the very least, we expect a hub to be able to provide backhaul for a wireless network, where there is demand, so that premises would be able to gain access to a wireless internet service from at least one of these hubs—assuming they can afford to do so."
The report proposes that the Government undertakes a details costing of these proposals, on the basis that they are likely to provide more scalable, future-proof broadband services to everyone. This is in contrast to the 90% superfast availability set out in current plans, which it is argued risks creating a new digital divide between areas with basic and superfast connectivity.

The report also challenges current policy's focus on speeds, chiefly the definition of superfast broadband as above 24Mbps. This derives from Ofcom's context and summary for its 2010 consultations on the wholesale local access and wholesale broadband access markets, being the theoretical maximum possible download speed achievable over copper telephone lines via digital subscriber line (DSL) technologies:
"Super-fast broadband (i.e. broadband with speeds greater than 24Mbps) will provide consumers and businesses with higher speed and more capable services, which are likely to enable the use of a wide range of new and innovative applications. These could, for example, include super high definition and 3D video services, more effective teleworking and telemedicine."
However the House of Lords report suggests that imposing such an arbitrary target impedes flexibility and takes connectivity options which could be viable in many areas out of the running:
“…we endorse the replacement of copper by fibre deeper into the network. However, there are indications that mandating this shift by means of a speed target has built inflexibility into the implementation of the current policy, with a number of undesirable consequences. 
One of these was described by Rory Stewart MP, in reference to Northern Fells, an area in his constituency. Having formed plans to bring fibre within reach of its village, the community considered the use of the wireless technology, ‘white space’, as a way of reaching its outlying properties. The problem that arose was that white space spectrum is technically limited to delivering a maximum of roughly 15Mbps, and as this falls short of the Government’s targets, it is ineligible for public money, stranding the outliers with a lower level of service. As Rory Stewart MP put it: “I think it is about flexibility. I think it is about loosening the reins a little, loosening the criteria and being prepared to look at each case on its merits."
Curiously, by mandating a specific speed target, with the intention of pushing fibre—and by extension, enhanced capacity—deeper into the network, the Government have in some cases ensured that communities reliant on more experimental, innovative technological solutions will not get any enhancement at all. In short, because their plans do not meet the Government’s aspirations in full, they will be condemned to nothing.”
The phrase "loosening the reins" is key here; the focus on speed "inevitably forces Government to make dogmatic statements about things which are better left flexible." Ironically, the report suggests that its proposals for local fibre hubs may in part be met by the Government's proposals for its Mobile Infrastructure Project (MIP) - the focus of which is the provision of voice rather than data. This is seen as an opportunity missed in one sense, but offers a potential remedy in another:
"It should be a fundamental 'design principle' of the Mobile Infrastructure Project that where mobile coverage is being widened for the purpose of eliminating voice not-spots, coverage for data is widened and enhanced at the same time. 
In addition, we note that BDUK is considering implementing the MIP objectives by means of "an investment by government in building Serviced Sites… in an appropriate location to serve one or more not-spots, where site facilities, power, backhaul, connectivity, cabinet and mast space were made ready and available for 'occupation' by all mobile operators." 
In other words, the MIP, in establishing a number of 'base stations' or 'serviced sites' with fibre backhaul, may bring about something equivalent to the open access fibre-optic hub which we introduced in Chapter 3. In fact, should the MIP be implemented along the lines outlined above, these serviced sites will be procured with clear open access stipulations, allowing any mobile network provider to set up their own access network services from those points.
There is a technically strong argument, therefore, given the virtually unbounded capacity of fibre, that it would be a significant enhancement to incorporate into the MIP plan the following stipulation: that access be open not only for mobile network providers, but also for any prospective network provider to build out an access network from that point, should they see a commercial opportunity or otherwise believe there is value in doing so. 
The Government should consider the potential for serviced sites constructed as part of the MIP to be used as open access fibre-optic hubs more generally, from which independent third parties could extend out their own alternative, local access networks."
The report is also critical of another part of Government strategy, the Rural Community Broadband Fund (RCBF), on the basis of the uncertainty over where investments supported by the fund should be targeted:
"....the RCBF is only available "if your community is in a rural location identified as being in the 10% hard to reach area covered by your Local Authority's Local Broadband Plan." In other words, it is only available if you are excluded from your Local Authority's Local Broadband Plan.
Miles Mandelson, Chairman, Great Asby Broadband, explained that when local authorities are asked whether they can guarantee that a specific community falls outside the boundaries of its roll-out, the answer is: 
"'No, we cannot. We have not finished our procurement. We do not know what the boundaries are going to be and the situation keeps changing. But, if you like, you can exclude yourself from the county council roll-out and we will not come anywhere near you.'" 
As there is equally no guarantee of inclusion within the RCBF scheme, communities are naturally wary. After all, as Miles Mandelson put to us, if: "their application [to the RCBF also] fails… they are then left with nothing more than the 2Mbps universal service commitment (USC)." 
As a result, remote communities—particularly those engaged as part of BDUK's pilot scheme—are being forced to take on a considerable amount of work and responsibility, with the entirely likely result that they will ultimately be told they fall outside the boundary of the roll-out. 
A further failure of the RCBF arises from its specific stipulation that communities in the final 10% fund the construction of their access networks with no guarantee of grant payment from Defra; they will only be able to recover the expenditure once they have provided evidence that they have paid for it—and even then there is no guarantee. According to Defra's RCBF Handbook: 
"In simple terms, you will need to spend first—and then claim later." 
In our view, it is ludicrous to expect all remote communities to be able to provide the levels of funding required to build broadband access networks in their areas. While there may be some which can, inevitably others will not be able to do so. The RCBF process, therefore, will present a number of communities, whom it is intended to assist, with a Catch 22...We urge the Government to provide a more coherent mechanism for the provision of enhanced broadband infrastructure in the final 10% than currently is the case with the Rural Community Broadband Fund. In particular, a new mechanism for distributing funds must meet the criticism that its predecessor was flawed in assuming all communities have the capital required, up front, to invest in their own access network."
The report agrees the Government is correct to focus on a universal service commitment (USC, for which it is politically accountable) rather than a universal service obligation (USO, which would make industry directly accountable). However, the growing move towards broadcast TV being delivered via IPTV may change this in time, as well as freeing up valuable spectrum which could be put to other purposes:
"It is likely that IPTV services will become ever more widespread, and eventually the case for transferring the carriage of broadcast content, including public service broadcasting, from spectrum to the internet altogether will become overwhelming. This may well be a more sensible arrangement, as spectrum is perfectly suited to mobile applications...it might be argued that spectrum’s current use for fixed, broadcast purposes is wasteful. 
We recommend that the Government, Ofcom and the industry begin to consider the desirability of the transfer of terrestrial broadcast content from spectrum to the internet and the consequent switching off of broadcast transmission over spectrum, and in particular what the consequences of this might be and how we ought to begin to prepare. 
As and when this occurs, and particularly if Public Service Broadcasting channels begin to be delivered primarily through the internet, the case for a USO, echoing that for television and radio, will become, in our view, significantly stronger. 
While we do not support the introduction of a USO at present, we do believe that broadcast media will increasingly come to be delivered via the internet. As and when that happens, and particularly in circumstances where this applies to PSB channels, the argument for recommending a USO becomes stronger. The Government should begin now to give this active consideration."
The report also echoes the calls made elsewhere for the scope of Ofcom's physical infrastructure access remedies on BT (duct and pole access) to be widened:
"In our view, the benefits of opening up the restrictions on PIA are likely to be significant, particularly were policy to be re-oriented towards the establishment of open access fibre-optic hubs, as we advocate. Removing the restrictions on PIA may, of course, have knock-on effects for the effectiveness and coherence of other aspects of the overall regulatory edifice. We, therefore, recommend that Ofcom evaluates alternative approaches to the regulation of the broadband market as a whole, in line with EU guidelines."
Finally, just as with the transition from analogue to digital TV, it may be appropriate for Government to mandate a "fibre switch over" in the future:
“…a new digital divide may emerge between those with respectable and those with elite connectivity, separating those who can access what will in some cases be critical public services or public interest content from those who cannot. As a result, just as with digital switchover, a time may come when it is appropriate for the Government to mandate a form of Universal Service Obligation in the shape of a similar measure which might be called fibre switch over. 
We recommend that consideration should be given over time by the Government, Ofcom and the industry as to when and under what conditions fibre switchover would be appropriate and what implications it would have.”
It will be interesting to monitor if and how the Government's broadband policy takes on board the report's recommendations.