Br0kenTeleph0n3

Following the broadband money

How to get better value from that £250m for rural broadband

with 10 comments

BrokenTelephone doesn’t normally publicise paid-for events, but we’re making an exception in this case. We have long argued that the UK has ignored alternatives to the gap-funded model beloved by BT to finance investment in broadband networks. At last someone has heard us and is taking he message seriously.

Adrian Wooster, late of BDUK and now with Broadway Partners, is putting together an event for 12 March to look at the non-engineering aspects of getting next generation broadband into the Final 10% – funding, investment, business models, social inclusion, and the dreaded state aid. It is aimed at the public sector, financiers and communities.

The timing is perfect because DCMS has just announced how the £250m of the £300m promised years ago will be divvied up: England £184.34m; Wales £12.1m; Scotland £20.99m and Northern Ireland £7.24m.

The official reply to BrokenTelephone’s questions about the terms and conditions tied to the allocation was, “Procurement will be a local decision – we’re not dictating who the supplier should be. Where contracts are already in place with BT, local bodies can decide to extend them (within contractual limits); or to undertake a new procurement either using the national framework or not.”

Reading between the lines, there is a desire for local authorities not to simply give it all to BT but to conduct genuine fresh procurements in an attempt to get better value for taxpayers. INCA has shown that LAs can likely get better value for their taxpayers’ money if they go with altnets rather than BT. INCA executive director Malcolm Corbett is on record saying that procurements that pick BT find they contribute up to 90% of funds to what is meant to be a match-funded process; altnet solutions could come in at 30%, thanks to the willingness of private investors.

BT is already trying to “white ant” altnet coverage areas, making it difficult for altnets to provide coverage without overbuilding BT’s subsidised coverage areas. It is also spending £50m to fill in city not-spots and hook up multi-tenanted buildings to stop Hyperoptic and CityFibre from having a free run. BT claims that serving 150-home villages like Lancashire’s Dolphinholme is commercially viable. That might be true, but only because BT is running a fibre to a nearby radio mast; Arqiva or a mobile network operator is picking up most of the capital cost, and the village (or rather homes along the road) is covered en passant at marginal cost.

The other big win for LAs is that many would-be altnets offer fibre to the home; BT’s fibre stops at the street cabinet. So even if the altnet fails, the fibre is in the ground; LAs could get BT or another big operator to take it over at a fraction of the cost than if they picked BT at the start.

Wooster says the event will present funding options that don’t depend on gap-funded grants. “The UK is largely alone in gap-funding. There are very good, tested models that we should be learning from. These have a bigger economic impact and are better value for the stakeholders including, not least, the public sector,” he says.

Wooster says delegates will learn to how create more options and choices for broadband delivery; how to maximise their SEP allocation; how to love state aid; how to get new funding streams without spending a penny; how to de-risk their projects; how others abroad have done/are doing it; and how to make your area a contender for ‘Best Broadband in Britain’.

The event will be at the Riverside Studios in Hammersmith, so reasonably central. Fees are £99 each for civil servants, and £50 each for communities. Book via https://broadwayworkshop1.eventbrite.co.uk.

UPDATE

The price for communities has dropped to £25, and Wooster says, “We will listen to cries of poverty.”

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Written by Br0kenTeleph0n3

2014/02/27 at 10:32

10 Responses

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  1. “INCA executive director Malcolm Corbett is on record saying that procurements that pick BT find they contribute up to 90% of funds to what is meant to be a match-funded process; altnet solutions could come in at 30%, thanks to the willingness of private investors.”

    You’re one of those potential private investors.

    You’ve seen how BT responds when private investment is used to deploy an altnet.

    You know that BT has access to a pot of cash from the taxpayer.

    You know that there is no way of getting any clear, meaningful information from LAs about which areas that pot of cash will cover and moreover that such areas are “subject to survey” and could change. (Read as “could be used to overbuild our efforts”)

    You know that there is a fair likelihood that, actually, the entity making the decisions about deployment areas is not the LA, but BT.

    You know that the contracts drawn up between the LAs and BT is “confidential” and you cannot gain access to it.

    In these circumstances, would you invest?

    Mark

    2014/02/27 at 11:38

    • Mark – I think that sums up the problem in a nutshell.
      This steaming pile of dung belongs on Ofcom’s doorstep. Part of its mission is to encourage investment in UK Telecoms PLC. Permitting the situation you describe so succinctly means it is failing in one of its primary roles.
      Fortunately Ofcom chairman Colette Bowe will be interviewed by the Communications Committee at 4.30pm on 4 March in Room 2 at the Palace of Westminister, should anyone like to brief the inquisitors.

      Br0kenTeleph0n3

      2014/02/27 at 16:09

  2. Until the LAs stop behaving “anti-community” driven by BT’s confidentiality rubbish about speed & coverage templates, there’s a substantial risk element in any alt-net non-gap funded initiative. Enough risk for a sensible alt-net operator not to bother. BT can decide to say “umm … sorry – didn’t we tell you we were building there? Go away please”.

    LAs need to develop teeth that benefit the taxpayer, not BT. LAs need to say where, and when, and if they can’t (because BT won’t tell them), they need to protect competitive bids that WILL say where and when – contractually, and openly. BT’s all it can eat banquet needs to be cut back, with side tables for alt nets that let communities know what they are getting for their tax money.

    • Alternatively brave altnets can go ahead and build, and then let the people decide who is providing the best service? I know B4RN is world famous now thanks to the community, but there are many who jfdi without publicity, and are doing just fine, but could do far more if they had some support. If they keep under the radar they don’t have the hindrance, and that is worth a lot.

      In our area people still have a choice. 1000 megabit symmetrical via community owned fibre at £30 a month, or satellite at £50 a month with massive data caps, or dial up, or adsl under 1 megabit that fails on a regular basis, or the promise of fibre on demand from BT at £90 a month delivering 300 megabits and not symmetrical.

      I think if an altnet just builds in an area where BT won’t go, the results will speak for themselves, and once built they can then harvest from more urban areas once people can see the superior service. That is what BT is so scared of. They don’t really care if we build in the final 3% where we are now, but they dread the day we move in on their patches. That is why wherever an altnet is working BT step in with their ‘solutions’. That is why the funding should go to altnets, as it provides the much needed competition. In our areas copper just won’t work. Therefore BT has to lay fibre instead of doing patch ups as their other solutions are so obsolete. BT won’t do that unless forced, they prefer to blag the copper and convince the council that it will work. The council is very happy to believe this, they can see the emperor is naked but they daren’t speak up.

      The more fibre we get the better. Everyone wins. Its just a shame that the regulator is asleep and the councils don’t know anything about physics and are conned by a monopoly with a massive marketing budget. Its also a shame that we are in serious danger of becoming a third world country for digital. The emperors new clothes?

      chrisconder

      2014/03/01 at 10:57

  3. Reblogged this on 50963182600013.

    bilunov77

    2014/02/28 at 03:41

  4. […] be given no new money until it has better accounted for what it has already received. Meanwhile Ian Grant has drawn attention to a Broadway Partners event on innovative funding models, timed to help Local Authorities and […]

  5. […] be given no new money until it has better accounted for what it has already received. Meanwhile Ian Grant has drawn attention to a Broadway Partners event on innovative funding models, timed to help Local Authorities and […]

  6. […] be given no new money until it has better accounted for what it has already received. Meanwhile Ian Grant has drawn attention to a Broadway Partners event on innovative funding models, timed to help Local Authorities and […]

    • Broadway Partners has postponed this event. Feedback from local authorities is that they prefer to discuss alternative ways of working in private, they say.

      Br0kenTeleph0n3

      2014/03/06 at 08:55


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