Br0kenTeleph0n3

Following the broadband money

Britain’s broadband budget is £3.58bn (approx)

with 5 comments

News that Europe is preparing a €9.2bn kitty to get broadband from where we are now to everyone having 30Mbps and half of us with 100Mbps left me underwhelmed and puzzled.

Over the weekend I tried to work out from public sources exactly what the UK has budgeted to get the entire country up to 2Mbps guaranteed – almost £3.58bn, not including our share of the proposed Euro-kitty.

If you reckon that we should be able to get at least £500m in matched funding or other “slush funds”, that is pretty close to the £4bn total people were whispering in my ear three years ago.

This is short of the £5bn-odd the Broadband Stakeholder Group said it would cost for national broadband access based on fibre to the cabinet, and a long way short of the almost £30bn for fibre to the home.

For months Digital Agenda champion Neelie Kroes has been asking telco bosses how much for 100Mbps. They have replied, “Well, it depends, but more than you think,” while continuing to sweat their copper assets.

I think we can safely say that when it comes to the final bill for 100Mbps broadband, everyone is guessing, and few are telling the whole truth.

The truth is hard to establish. For instance, looking at Northern Ireland, which is relatively simple, one can see many potential sources of finance: BT, various government departments, and a bunch of European purses as well.

This table is taken from Northern Ireland’s department of enterprise, trade & investment (Deti) web page on superfast broadband.

Northern Ireland
Source of funds Project £m
BT Broadband upgrade 30.00
ERDF via DETI Broadband upgrade 16.50
DETI Broadband upgrade 18.00
EAFRD via DARD Broadband upgrade 1.50
DARD Rural areas 1.00
BT Matched funding 1.00
ERDF NI Broadband Fund 1.90
DETI Commendium contract for advice 3.90
DETI Avanti satellite broadband 1.25
Total 75.05

Below is what I think is the UK’s broadband budget to 2015. I have assumed that BT’s contribution in Northern Ireland is part of its £2.5bn Next Generation Access budget to 2015, and excluded the £2.5bn it will probably spend on normal network build and maintenance.

If anyone can improve the accuracy of the tables here, please feel free to point out any errors. And if anyone wants the allocations to English counties, please let me know. If anyone has the Scottish and Welsh allocations, I’d be happy to put them up here. As for Northern Ireland, well, that’s pretty much all BT’s, I believe.

Britain’s Broadband Budget
£ £
BT 2,500,000,000
Cornwall 132,000,000
Digital Region 94,000,000
Defra 20,000,000
Rutland 710,000
DCMS England 294,890,000
Scotland 68,000,000
Wales 56,900,000
Northern Ireland 36,000,000
Unallocated 74,210,000
530,000,000
DCMS Post 2015 300,000,000
Total 3,576,710,000

This may include double counting of BT’s £78.5m contribution to Cornwall, which probably comes from its £2.5bn headline Next Generation Access budget.

It also excludes provision for matched funding that DCMS/BDUK expects to elicit from companies that bid for bits of the DCMS’s £530m. How much BT kicks in in matched funds will probably come from its NGA budget, so will not increase the pot at all.

It also excludes projects such as B4RN, which will start seeking investors in November for its proposed community-owned 1Gbps fibre to the home network.

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Written by Br0kenTeleph0n3

2011/10/18 at 08:00

5 Responses

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  1. A 2M target is pointless, needs to be at least 10M or even 25M.

    Somerset

    2011/10/18 at 08:41

  2. a 2M target is indeed pointless, until you realise the mammoth task in providing 2M via the “Preferred suppliers” infrastructure.

    Last i heard this was a symmetric requirement too 2M up / 2M down , even ADSL2+ will choke on that if you are more than a gnats fart from the exchange.

    Meanwhile lesser providers like Kijoma provide 2 Mbps upload without distance limitations and somewhat more than 2 MBps download, also without distance variation/limits 🙂

    joined up government… yea.. o k… it looks like we are in for a state funded monopoly that even Africa’s “Telkom” could learn from 🙂

    bill lewis

    2011/10/18 at 09:29

  3. Ian, B4RN has me intrigued, mainly as i would be interested to know what they are going to backhaul it with capacity wise. It is all well and good headlining “1Gbps” to the home, that is easy to do as hey my PC connects at 1Gbps! it says so in the task bar ! 🙂 , doesn’t mean there is a gigabit available though.

    Using typical Data bandwidth costs, feeding this gigabit network with a gigabit (so thats a gigabit contended with as many customers it feeds) would cost typically between £10000 and £20000 a month.

    And if you do the math on how many customers you need to spread that cost to break even then the contention will look pretty ugly.

    Of course if B4RN are able to pay a penny a mb/sec then great and if so, can they say where please so we can sign up 🙂

    bill lewis

    2011/10/18 at 09:42

  4. B4RN needs 650 customers to start so that’s £23/month/customer initially for backhaul, decreasing as numbers increase.

    Somerset

    2011/10/18 at 11:12

  5. All of B4RN’s costs and figures are on the website under Business Plan at http://www.b4rn.org.uk.

    Lindsey Annison

    2011/10/18 at 18:04


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