MPs, lords to face anger over failing UK broadband roll-out
Parliamentarians will meet tomorrow to discuss broadband policy amid growing anger and concern among businesses that almost £2bn in taxpayers’ subsidy will leave the UK in a worsening competitive position.
Digital Policy Alliance chairman Lord Erroll will chair the meeting (see below for details) that will hear from two recent papers that show that large parts of the UK will end up with broadband access one-fortieth of that of South Korea, and far behind France, Brazil and China by 2017, the deadline for the government’s current broadband spending plans.
The report from Digital Business First (DBF) flatly contradicts Ofcom’s recent finding that the UK leads Europe in high speed broadband. In an open letter to Ofcom CEO Ed Richardson, the DBF said, “When ranked against all 27 EU states (not just the five Ofcom conveniently chose for the sake of a headline) the UK ranks tenth, behind countries like Portugal, Denmark, Belgium, Lithuania and Latvia.
“Secondly, there are large areas of the UK (approximately 10 million homes and businesses according to the government’s own figures) that are to be supported with public funding to deliver ‘target’ broadband speeds of just 2Mbps and 24Mbps (via the BT network). These speeds are well below even Ofcom’s low threshold of ‘superfast’ broadband. These ‘have nots’, which include some of our most productive business premises in rural locations, are being left to languish in the slow connectivity lane indefinitely.”
The forum’s assertions are supported by a study of the effect of line lengths on broadband speeds by researchers at Edinburgh University. The researchers found that one in eight Scottish homes is unlikely to be able to get more than 24Mbps, and 40% of rural homes and businesses will struggle to get more than 2Mbps.
Openreach, BT’s network infrastructure division, redacts its line length information in recent public documents. However, in a 2011 report on line lengths and line costs to Ofcom, Analysys Mason said that BT had confirmed (in 2004) that its average line length (between the exchange and the premises) was 3.47km (including the dropwire length). “This provides a reasonably good reconciliation with the (2008) Sagentia analysis (3.34km average line length). The same presentation also confirmed the distribution of lengths between the cabinet and the customer, with a typical 420m length and a small proportion of lines (10%) with a very long length,” it said. Analysys Mason later calculated the average Openreach line length at 1.704km – a figure hotly disputed by Openreach.
A 2011 White Paper by Alcatel-Lucent on the use of vector technology with VDSL2, the technology chosen by BT for its next generation broadband roll-out, found that at 420m, the average download speed would be about 40Mbps, while at 1.2km, it would drop to about 24Mbps (see graph).
Figures from the Office of National Statistics show a declining trend in the construction of communications infrastructure (see graph). The ONS figures include post office buildings and sorting offices, but also exchanges and cables. This suggests that few new cables have been laid in the past 15 years, so Sagentia’s figures are likely to be reasonably accurate.
(Unfortunately, the ONS bundles sales figures for telecommunications equipment with those of computers. This makes it impossible to establish accurately what UK network operators have invested in network hardware and software.)
As noted earlier, Openreach’s capex has been steady at around £1bn for several years. But it is starting to decline as it comes to the end of its “commercial” broadband roll-out to cover two-thirds of the population, but only one-third of physical UK.
In BT’s case, Alcatel-Lucent appears to have made a convincing argument to go for vectoring over VDSL2. It said, “Reusing existing infrastructure reduces investment costs and risks. It also helps with eco-sustainability targets. With VDSL2 Vectoring, you can deliver higher speeds at about 1/3 the cost of deploying fibre. And any fibre investments to support VDSL2 Vectoring lower costs for future fibre deployments.”
But as its own figures show, this is true only where line lengths are short, and it does not appear to include any offset for reclaiming the copper and reusing the ducts.
DBF members Alex Pratt and Frank Nigrello, who represent local enterprise partnerships in Buckinghamshire and Oxfordshire respectively, accuse Ofcom of painting an “unduly rosy picture” that serves the UK badly. “It amounts to institutional denial of the need for a significant change in policy towards investment in digital infrastructure. It is leading to an unnecessary rapid regional and national decline in our relative productivity and competitiveness. It is akin to adding extra weight to handicap our businesses in what the prime minister has called ‘The Global Economic Race’.”
The DBF is highly critical of what it sees as the government’s casual approach to broadband. “Current government policy and funding has failed to bridge the superfast broadband infrastructure deficit for 35% of the UK,” it says. It attributes this to a lack of consultation with user communities; adopting the “least ambitious targets and technological means” to deliver them, and to a lack genuine incentives for investment in future-proof high speed broadband networks.
Quoting from the National Audit Office report on the rural broadband roll-out, the DBF said, “The department (of culture media and sport said) its aim was to achieve the most possible with the given funding, not to lever the maximum amount of private investment.”
It added, “The current argument between Ofcom and mobile networks on spectrum fees, with the latter threatening to reduce 4G coverage unless fees are lowered, points to a far less investment friendly approach in the UK.”
The DBF report also criticises the lack of ambition in making high speed broadband a universal service. Again quoting the NAO report it said, “The effect of designing a programme which only reaches 90% of the target area will make it more expensive at a later stage to cover the final 10%. It will also make it less commercially viable for anyone other than BT to bid, as no-one else will have existing infrastructure to bolt it on to.
“Matters are made worse by the fact that BT is preventing local authorities from publishing plans showing which areas will not be covered, which would enable other, often community-based consumers, from filling the gap and ensuring 100% coverage.
“Witnesses from the broadband industry told us that potential investment by competitors had been lost. For example, UK Broadband has spent none of the £150m it had allocated for the programme. Fujitsu had also stated an intention to invest £1.5bn which has not been invested. In total, INCA estimated that the investment that had been foregone was at least £2.7bn.”
The DBF calls for a national broadband plan and responsibility for its delivery to be moved the department responsible for business and enterprise.
“Any incoming government in 2015 should be specifying a target of at least 100Mbps for the UK ‘have nots’ within two years,” it says.
It called for the UK to re-establish its world lead in mobile communications by “adopting an ambitious ‘can do’ approach to 5G technology”. 5G networks offer the prospect of universal ultrafast (1Gbps) broadband across the UK, it said.
It also called for changes to the terms of the 4G mobile licences to ensure that the coverage obligations include a signal strong enough to deliver 10Mbps inside a home for 98% of the UK population, a voice service, and for more than one 4G mobile network to have the above coverage obligation.
The meeting takes place on 24 March at 15.10-17.00 in Committee Room 4A, House of Lords, Westminster.
The agenda is:
* Welcome and introduction by Lord Erroll, DPA chairman
* Presentation of European Internet Foundation’s (EIF) report ‘The Digital World in 2030: What Place for Europe?’ by Peter Linton, advisor to EIF board of governors and co-author of the report
* Presentation of Digital Business First’s report “The UK’s enduring broadband deficit: A divided nation – Time for an effective plan” by Alex Pratt, chairman Buckinghamshire Business First and Buckinghamshire Local Enterprise Partnership (LEP).
* Comments by Stephen McGibbon, EMEA regional technical officer, Microsoft; Peter Olson, president of Digitaleurope and head of European Affairs, Ericsson; Alexandra Birtles, head of external communications, TalkTalk Group; and parliamentary contributions with closing remarks by James Elles, MEP and EIF co-founder.