35% is SuperConnected success, says BDUK
BDUK has pronounced itself happy with the results of its two month pilot of a voucher scheme to increase small business connectivity in cities, even though only 35% of requests for funding led to a quotation.
The original £150m SuperConnected Cities project aimed to set up fibre to the premises (FTTP) networks in 22 cities. Following legal objections from BT and Virgin Media, this was replaced with the voucher scheme. The scheme allows SMEs to apply for grants of up to £3,000 to fund a connection to a broadband service that gives “step change” in the speed received.
The scheme was red-lighted (deemed in imminent danger of failing) in a Cabinet Office report last May.
The £2.25m pilot ran, largely unpublicised, from the start of August to the end of September in Belfast, Cardiff, Edinburgh, Manchester and Salford.
“The supply chain supporting the use of vouchers is either competitive or regulated so this will prevent distortions to competition,” BDUK said.
BDUK reported 59 suppliers registered, though some were inactive prior to the scheme. Sixteen didn’t meet the registration deadline, and a further 19 said they were interested in Phase 2 of the project.
There were 690 voucher requests, of which 443 conditional offers were made (12 rejected), leading to 240 quotations from 28 suppliers.
BDUK declined to give a breakdown of the location of the requests, or many contracts were signed, or the amounts committed.
However, Metronet, a fibre-wireless ISP in the north-west, claimed 13 orders from the voucher scheme. This earned the firm a visit from communications minister Ed Vaizey during the recent Conservative Party conference to learn the secret of their success.
MD James McCall is on record saying businesses depend more on having a reliable service than raw speed.
BDUK said, “Some cities and suppliers have noted that some SMEs fed back that they value the quality of service elements of business grade services and that a service under 30Mbps can represent a significant upgrade in capability. We will consider whether there is an opportunity to be flexible around minimum speed required for business grade services.”
It added, “From our perspective and that of the (European) Commission the scheme the market test have (sic) been successful.”
BDUK is holding two industry days to provide feedback and discuss phase 2 on 18 and 21 October in London. It will present its findings to the European Commission Case Team on 31 October and to the Commission on 6 November. Ministers will decide whether to go to phase 2 shortly after.