Following the broadband money

Have BT & Fujitsu unlocked BDUK’s millions for rural broadband?

with 25 comments

It appears that BT and Fujitsu have signed contracts to supply broadband infrastructure under the BDUK framework following months of negotiation between the department of culture media and sport and the European Commission’s competition authorities over state aid issues.

Unconfirmed reports on the EDP24 website say the county councils’ broadband procurement programmes can begin at last after the names of the two suppliers were revealed last night. However, the press release sites for BT, Fujitsu, DCMS and the DG Competition, which has to rubber stamp the terms and conditions for state aid, carry no mention of the deal.

Br0kenTeleph0n3 understands that a deal has been done, but it’s being downplayed as a ‘soft launch’.  However, officials have been told not to deny it if asked.

The government has set aside more than £830m of taxpayers’ money to extend high speed broadband into rural areas and provide cities with up to 100Mbps services. Contracts are expected to enjoy matched funding from the suppliers, and unknown millions more from the EU and other sources like Defra.

The hold-up was apparently due to the DG wanting taxpayers’ money spent on projects that would see the UK’s broadband not spots gets access to a minimum 30Mbps download service between now and 2020. This is above the proposed 24Mbps previously offered by BT and Fujitsu.

BT and Fujitsu were later said to be refusing to sign the procurement framework contract because the extra 6Mbps target is likely to raise their costs considerably. However, contracts already signed, such as in Cornwall and Rutland, will apparently go ahead because they were done outside the BDUK framework.

Cumbria County Council recently rejected proposals from both suppliers, sayin it is looking for a ‘future-proof’ solution.

It will be interesting to learn who blinked. Did BT and Fujitsu agree to go for a minimum 30Mbps service? Did DCMS agree to give them more taxpayers’ cash? Did the DG compromise Europe’s Digital Agenda targets in the UK’s case?

We hope to find out on Monday.

Written by Br0kenTeleph0n3

2012/06/30 at 19:10

25 Responses

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  1. If BT enable the notspot exchanges with adsl2+ then they could claim anyone connected to those exchanges could get ‘up to’ 24 meg. Just like 2003 when they did adsl, and they still say over 99% of the uk can get broadband. We know folk can’t get anything like that, witness the ‘final third’, yet the regulator still publishes that info on its web site. The same thing would have applied if BDUK hadn’t hung out for the 30meg.

    Therefore we now have the offer of FTTP. So theoretically if one is prepared to pay everyone can have a fibre. It will be interesting to see the costs, if a customer is expected to pay excess charges the same as they do if they want a leased line now then the notspots will remain, and folk will stay analogue.

    Far better to give the funding to altnets and let them build new fibre networks, rather than run it from the old phone network. Build it once, and build it right. Get some competition coming in from the fringes, then market forces will sort the cities. win win.


    2012/07/01 at 06:49

    • And who are these altnets that are screaming for the funding? Only Fujitsu left in the race.

      Or are you saying that £530m is enough for someone like B4rn to do the final third of the UK. B4rn is great don’t get me wrong, but I remember the launch and when asked about going into the more dense (but still rural villages) that cost and wayleaves was an obstacle.

      Smallworld et al, do their networks meet EU requirement of being open at wholesale level?

      Andrew Ferguson

      2012/07/01 at 11:40

      • Exactly Andrew, none of them could comply with the ‘open and transparent’ tenders the councils put out. Also they are fettered by VOA tax which doesn’t hit the incumbent. Therefore it was never a level playing field and none could compete. Fujitsu also will have its work cut out to stay in the game. The vital vision which BT have invested in for many years (now taken down off the web but available if you search) is paying off. Most councils and politicians have now got the vital tunnel vision and believe the incumbent can deliver. At last we have one council asking ‘exactly how much and how far and how fast’ (Cumbria) but others are happy to hand our public money to a company whose only goal is to protect their ass ets and keep shareholders happy and pay their bosses millions, and stifle all innovation for another decade. Its up to BDUK to see through it and sort it out.

        Regarding B4RN going into the more urban areas, the idea of building b4rn was to help those who still can’t get a connection. In order to fund it you can only target those people, because the rest are too apathetic and will wait for the ‘government’. The rural people are desperate, and are willing to invest and also to help the digging.
        When your question was asked perhaps the answer was because of that explanation, but looking to the future the altnets like the b4rn network will give the urban fringes more choice, and when you can choose between a fast fibre and a throttled and capped copper I think the market will vote with its feet.


        2012/07/01 at 12:38

  2. Who are all the altnets that will build fibre networks and what funding do they need?


    2012/07/01 at 07:09

    • You have read this blog long enough to know the answer to that question Somerset. Smallworld, Vtesse, – lots of the Davids who have not had a rock. Now there is a chance they have a rock.
      It will be interesting to see if government give them the catapult and a level playing field for the battle, or if telcos will stop defending their obsolete assets and start to deliver a good service to ALL rather than lose the war.


      2012/07/01 at 07:17

      • If FTTC is the only solution that meets the long term requirements then what funding would Smallworld, Vtesse or even Openreach need to install across all of the UK? That is what the government has to provide.


        2012/07/01 at 10:21

      • Somerset, FTTC is not a solution and certainly not a long term one. I guess that was a typo. Also if you bother to follow the argument, an altnet would deliver more bang for buck, and support or soft loans would only be needed to get a connection into rural areas. The market would then be forced to deliver the rest.


        2012/07/01 at 10:41

      • Apologies, of course I meant FTTP as the only long term solution. The question is funding the installation into properties.


        2012/07/01 at 11:45

  3. will this be the ASA “10% of customers can receive the headline speed” criteria with respect to the 30 Mbps target? . If so then BT/Fujitsu and their army of parasites have little to worry about.

    It will mean an increase in ISP’s rejecting orders from potential customers who may mess up their averages with a slow line though. This is apparently already happening, so i am informed, with ADSL/ADSL2.

    Who can blame ISP’s for doing that when the level of complaints from customers heads up the bathtub curve once a line drops below 2Mbps sync. The ISP gains the extra work, high churn and the negative press. Their wholesale infrastructure provider, with which they rely on, charges them to investigate faults or denies one exists..

    Now we have a two horse wholesale race, with what looks like a one horse infrastructure provider, i wouldn’t expect this situation to change for the foreseeable future.

    bill lewis

    2012/07/01 at 09:59

    • The 30Mbps target for ALL, not 90% is an EU 2020 defined goal, and as yet the technical nuggets over whether they are talking, throughput, connection speed, or technology aspiration, which is what the 10% ASA bit really is, is undefined.

      We are arguing over infrastructure competition in the last third in the UK, but one can get the impression that across Europe this row includes the cities still.

      Andrew Ferguson

      2012/07/01 at 11:42

      • If its the target for all by 2020 we’re gonna look a bit sick stuck on the cabs – unless they are gonna put cabs every 750 metres down each road? and one at every farm, rural business and house…
        Or as I suspect, they will declare each exchange is ‘FTTP ready’ and then when everyone says they can’t afford the thousands to connect over long distances BT will just say ‘well that’s up to you, the exchange is enabled and if you don’t want it you don’t have to have it’. They do the hype already with their constant ‘homes passed’ marketing messages.
        They are still doing it with adsl, their and ofcom stats still say virtually the whole country can get broadband. Maybe with odd pockets of 3G in rural areas and satellite they may, but not with clapped out copper.


        2012/07/01 at 14:12

      • So what do you expect BT to do? Just to end this constant moaning from some about BT and move on with some realistic, fully costed solutions for all of the UK.


        2012/07/01 at 14:45

  4. Well you’re the engineer Somerset, how about you make a start. Starting with rural areas so the market will have some competition.


    2012/07/01 at 14:47

    • The technology is not the problem, it’s the funding. Particularly as it’s said to be £3000/property for FTTP. Those in rural areas close to an exchange may be happy with ADSL2+ for a while so may not take up any new products, especially as they may get broadband as part of a Sky package.


      2012/07/01 at 14:53

      • You have a good point there , those close to an exchange, especially if not market 1, will probably be more than content with their current ADSL/ADSL2 service. Usually the Exchange is near the highest population density so the majority may not have any interest in FTTx .

        Those hanging on by their finger nails with 256kbps on the same exchange would think differently, however if the 90% don’t want/need it and the 10% do then how would this ever work commercially with FTTP/FTTC via the OR/Fujitsu business model? , especially as the 10% hanging off the end of the exchange would only benefit from FTTP as there is no practical scope for FTTC Cabs for wildly spaced out properties with masses of overhead and probably aluminium cable.

        What large commercial provider would spend £3000/property to run miles of fibre to them?. even if they were given the money to do that, it wouldn’t fit within the required operational profit margin.

        Technology may not “be the problem”, but like 3-4 lane Motorways, each technology/solution has it’s place, regardless of how “nice” or “desirable” they maybe.

        It is a shame that the only tech deemed worthy of investment via this whole fiasco is Fibre.

        Meanwhile we continue to install new 40 Mbps+ services commercially via Fixed Wireless.

        bill lewis

        2012/07/01 at 15:32

      • We do 150 meg symmetrical wireless here. We can only get limited backhaul at a price a community can afford. It isn’t the future though. The future is fibre. Do the job once and do it right. But wifi fills a need so that is why we use it. It won’t cope with what’s coming though…


        2012/07/01 at 16:38

      • Perhaps you could tell us what is coming that 150Mb symmetrical won’t do for the vast majority. 1.3TB/day.

        fyi HD video is 10Mbs and has always been the main need for fast access for home use.

        Fibre is a transmission method and just part of the whole charging picture. So your backhaul is over fibre but too expensive…?


        2012/07/01 at 17:45

      • perhaps you could convince us that the 2megabit USC is sufficient for the peasants Peter? I do know how much is needed for HD. I also know how many people in homes and businesses use the connection at once. I also know how scattered a population can be in a rural area and that to give them a connection that is fit for purpose needs a fibre. Everything else is just a stop gap. The fibre can deliver the 10 meg if that’s all someone wants, but it can also deliver terabits – its a job done. I am stopping arguing with you now, I know its a waste of time as we always repeat ourselves on every post we engage on. Its dead boring. ttfn.


        2012/07/01 at 17:55

      • 2M is not sufficient. But do you propose that the government should fund the rollout of fibre to every property in the UK? (or spend on trains…)


        2012/07/01 at 18:50

      • Please see my comments to Neil McRae.

        Ian Grant

        2012/07/01 at 19:57

      • Somerset – ‘Perhaps you could tell us what is coming that 150Mb symmetrical won’t do for the vast majority. 1.3TB/day’

        One possible..
        4K video (you can see this on YouTube already), displays are now available & they are filming the Olympics in it. A three hour film could be 2TB quite happily. A Blue-Ray can only cater for 25GB. The obvious way to deliver this content is over the internet.

        (Oh and 8K is already here).

        I know many will say it is not going to happen, but 12 Years ago I had a digital camera that had a 3.5″ floppy drive in it.


        2012/07/02 at 09:43

      • So how do we fund the rollout of 1.5Gbs links to all who might want/need them and how much should the user pay for installation?


        2012/07/02 at 20:58

  5. Of interest?

    a Consultation Paper on the Electronic Communications Code on 28 June 2012.


    2012/07/02 at 15:05

  6. interesting math, to quote Somerset “The technology is not the problem, it’s the funding. Particularly as it’s said to be £3000/property for FTTP” , according to West Sussex County council it is going to match the £6.2M from BDUK , so £12.8M and the “provider” is going to match that total (quoted from Lionel Barnard, dep leader WSCC, Radio Sussex Feb 2012) , therefore about £25.6 total. WSCC have had about 7000 responses from their home./business survey for people/businesses demanding “better Broadband” (see the data at > ). That means there will be about £3700 for each one of those 7000 , so sorted, they can fill that demand with FTTP, problem solved… 🙂

    bill lewis

    2012/07/02 at 23:04

  7. […] 20 July to discuss ways forward in the wake of the disastrous BDUK procurement process that saw only BT and Fujitsu left as possible bidders for up to £830m of taxpayers’ […]

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