Posts Tagged ‘Digital Britain’
Last week ministers claimed that the government’s £1.7bn budget has paid for superfast broadband to pass one million homes, so far.
This is 12% of the 8.8 million homes it is meant to serve with speeds above 24Mbps by 2017. As there appears to be no official source for the number of business premises, ministers are free to ad lib broadband availability to businesses.
There was no indication of what upload and download speeds users receive, and there are growing reports that services promised from some cabinets are now being deferred, perhaps indefinitely.
The money is all going to BT under the Broadband Delivery UK (BDUK) programme. It supplements the £2.5bn BT claims to have spent providing “superfast” service to the two-thirds of the population deemed “economically viable”, roughly the area covered by Virgin Media’s cable network.
A department of culture, media & sport spokesman said: “The £1.7bn is comprised of £1.2bn for phase 1 (£530m of BDUK funding plus local and European funding taking this up to £1.2bn) and £500m for phase 2 (£250m from BDUK to be matched by £250m further local and European funding).”
Based on the 2011 census, the Office for National Statistics (ONS) says there were 26.4 million households in the UK in 2013. Of these, 29% consisted of only one person and 20% had four or more people.
According to the department of business, innovation & skills, there were 4,895,655 UK businesses in 2013. Nor BIS, nor the ONS, nor the department of communities and local government (DCLG), which counts the cash raised from business rates, has a number for the physical shops, offices and factories businesses occupy.
That did not stop the Federation of Small Businesses last month from reporting that the national broadband network is unfit for business use. “The current government targets of 24Mbps for 95 per cent of the population and 2Mbps for the remaining five per cent will not meet the future demands of UK businesses.” it said. This includes video conferencing, remote back-ups and cloud applications.
This was tacitly confirmed by HMRC, which now allows firms in “remote locations” to submit their VAT returns by paper instead of online. FSB national chairman John Allan said the move will benefit many small businesses. “However, it clearly highlights the need for the government to tackle the poor state of digital infrastructure in the UK. Too many firms are negatively impacted by sub-standard broadband. It is vital business owners spend more energy doing business and less doing paperwork.”
There are also widespread reports that BT has deliberately ignored central business districts and business parks in both its commercial and taxpayer-subsidised broadband roll-outs. As a result, DCMS set up a £150m SuperConnected Cities fund that will give small business a £3,000 grant to upgrade their broadband connections in up to 22 cities.
The scheme was “red-lighted” In a Cabinet Office report in May 2013. A year later these cities had issued 1,008 vouchers.
Fixed to wireless connectivity was 77:23 with Virgin Media leading the list of suppliers followed by Metronet UK. DCMS said 149 suppliers had registered; 90 had won business as a result.
BDUK’s quarterly broadband performance indicator for June said the £72.4m BDUK has spent so far guaranteed at least 24Mbps download speeds to 888,133 premises. That is £81.56 per premises passed.
Put another way, the government is covering 12,260 premises for every million pounds spent so far. Ministers say they expect a £20 return on every pound spent on this roll-out.
Shoreditch MP Meg Hillier is to hold a Broadband Roundtable at 10am on 31 July at Perseverance Works in Shoreditch, the heart of London’s TechCity district, to discuss the “embarrassing” availability of broadband in central business districts, never mind rural areas.
So far 422 suppliers have registered to service the government’s £150m Urban Broadband Fund, which funds the SuperConnected Cities scheme. Some 149 have have provided quotations, and 90 have won business, says DCMS.
By the end of May the cities had issued 1008 vouchers in 14 months. The fixed/wireless connectivity split was 77/23 per cent, and the average speed per connection went from 11.2Mbps to 70.3Mbps for downloads.
According to Hillier’s blurb, “Broadband is a national embarrassment and action is urgently needed. Government grants of £3,000 have been added in, but that is like a sticking plaster on a broken arm. Businesses are moving out of the area because they simply cannot access high speeds.”
The cities in the SCC programme are Aberdeen, Belfast, Birmingham, Bradford, Brighton and Hove, Bristol, Cambridge, Cardiff, Coventry, Derby, Derry/Londonderry, Edinburgh, Leeds, London, Manchester, Newcastle, Newport, Oxford, Perth, Portsmouth, Salford, and York.
DCMS says it will provide a city by city breakdown “this summer”, but declines to say how much money has been paid out so far or to whom. However, Virgin Media tops a DCMS table of suppliers to whom vouchers have been issued (see below).
BT, which Ofcom says has an effective monopoly on wholesale fixed line access despite Virgin Media’s efforts, declines to say how many vouchers it has won. Its Openreach division is likely to be a big winner anyway. This is because smaller operators like Hyperoptic and TalkTalk rent ducts and lines from Openreach, even as BT’s Business division competes with them at a retail level.
So does 1,008 vouchers issued in 14 months represent success or failure? To be fair, it’s probably too soon to tell, but there’s not much time left – DCMS says the money dries up in March 2015.
It’s appropriate that Perseverance Works (PW) is the venue. Helped by former BDUK consultant Mike Kiely, the firm has just contracted Fibre Options to supply a 16Gbps link into the premises which houses around 90 businesses.
As landlord, PW will own the network. Each tenant will be able to use the government vouchers to order a connection running at up to 1Gbps. Fibre Options will do the provisioning and billing.
It took more than a year to negotiate the deal because the usual suspects were not prepared to consider an aggregated customer base – they wanted to sell a long-term leased line service that most tenants neither wanted nor could afford. PW eventually went to tender, which Fibre Options won.
PW spokesman Paul King says he sees “no reason” why PW’s approach should not be replicated by business parks across the country. Members of INCA are currently targeting business parks, most of which have been neglected in BT’s NGA roll-out.
The details again: 10:00-11:00, Thursday 31 July, 2014 at Eastside Educational Trust, Suite 16, Perseverance Works, 37 Hackney Road, E2 7NX. To book a place call Meg Hiller’s office at 0207 219 5325.
ISPs cash in on voucher scheme
|1||Virgin Media Business|
|5||Unitel One Source Ltd|
|9||Venus Business Communications|
|13||Unique Network Solutions|
|14||Qubic Group Plc|
We don’t normally move away from broadband, but this is a worthy exception because it bears on the kind of society that access to broadband opens up.
Last April the European Court of Justice struck down the Data Retention Directive . This is the basic European legislation that allows governments to implement legislation that enables them to collect, store and share communications data. The ECJ said it was too broad and there were too few safeguards to protect against abuse of the privilege.
This meant that the UK’s mass surveillance of its citizens’ communications lacked a legal basis. The Home Office told ISPs (which ones is secret) to continue to collect, store and share this data on demand with up to tens of thousands of public sector workers under the RIPA law. Privacy groups started court proceedings against the ISPs.
The government last week introduced primary legislation it said would restore its powers, nothing more. Now legal academics have challenged that view.
Paul Bernal, a professor at East Anglia, has published an open letter to MPs and lords calling for considered debate of the Data Retention and Investigatory Powers Bill (DRIP) and a halt to the “emergency” rush to turn the bill into law tomorrow.
“In fact, the Bill proposes to extend investigatory powers considerably, increasing the British government’s capabilities to access both communications data and content. The legislation goes far beyond simply authorising data retention in the UK. In fact, DRIP attempts to extend the territorial reach of the British interception powers, expanding the UK’s ability to mandate the interception of communications content across the globe. It introduces powers that are not only completely novel in the United Kingdom, they are some of the first of their kind globally.”
If passed the bill will give legal cover to the mass surveillance activities of GCHQ and the NSA exposed by the Snowden revelations.
Most European countries have either not implemented the Data Retention Directive (Germany decided it breached their constitution) or have struck down their enabling legislation to comply with the ECJ’s decision.
Bell Labs, which more or less invented the communications network business, has just given a new lease of life to copper network. In theory.
Its researchers have achieved speeds of 10Gbps over a pair of twisted copper lines in the lab. They have also got them to deliver 1Gbps symmetrical broadband, again in the lab.
That sounds like BT (in fact pretty much all incumbent telcos) is justified in pursuing its fully-depreciated investment in copper wires instead of switching to cheaper to operate fibre.
But the good engineers at Bell Labs also published a number of caveats.This is short distance technology. “The XG-FAST technology can deliver 1Gbps symmetrical services over 70m (for the cable being tested). This was achieved using a frequency range of 350MHz. Signals at higher frequencies were completely attenuated after 70m.”
So that’s it; 70m is the distance limit for gigabit copper.
But there’s more. “In practical situations, other significant factors that can influence actual speeds (not taken into account during these tests but which have been studied extensively elsewhere) include the quality and thickness of the copper cable and cross-talk between adjacent cables (which can be removed by vectoring),” they say.
They also published this handy guide for operators who are trying to match the exponentiating demand for bandwidth against their budgets for switching to fibre. It makes a trenchant leave-behind when you discuss the provision of high speed broadband with your local councillors and MPs as we approach the upcoming elections.
During testing, Bell Labs showed that
Maximum aggregate speed
|G.fast phase 1*||
|G.fast phase 2*||
|Bell Labs XG-FAST**||
2Gbps (1Gbps symmetrical)
|Bell Labs XG-FAST with bonding***||
10Gbps (two pairs)
* Industry standard specifications. G.fast allows for upload and download speeds to be configured by the operator.
** In a laboratory, reproducing real-world conditions of distance and copper quality.
*** Laboratory conditions.
Ofcom is obliged to not disclose the costing information that it gets from BT, which can be different from that which BT discloses in its regulatory financial statements. The Value Office Agency, which sets business rates taxes, does not disclose its financial model, or disaggregate BT’s products, so an important component of BT’s regulated prices is opaque.
Besides, BT sometimes changes the basis of its costs, as in “A6.47 BT has moved from an absolute valuation to a methodology based on indexing capital expenditure by RPI.”
This leave plenty to argue about. Sky and TalkTalk in particular are fighting a running battle with Ofcom over its assessment of the effect of business rates on BT’s prices for unbundled local loop lines (LLU). The debate forms part of Ofcom’s consultation on the fixed access market, which goes into excruciating detail, complete with triple negatives, on the business rates issue in Annexure 26.
The result of the debate is material to the two ISPs, which are the biggest exploiters of local loop unbundling. According to the Office of Telecommunications Adjudicator, by the end of May there were 9.3 million unbundled lines, and 5.68 million lines on Wholesale Line Rental (WLR).
The ISPs contend that BT receives a rebate on business rates due to LLU that amounts to an estimated cash value of £23/y per line. The rebate covers BT’s loss of profits due to the alienation of the full earning potential of the lines. The VOA and Ofcom consider those putative profits to arise mainly from “downstream” products from Openreach.
BT still makes money from renting out the lines, and besides any “lost profit” is at best a guess. Further, the business rates tax is a tax on assets, not profits. The ISPs believe whole of the rebate should be applied to the price BT charges for the line. Instead only 15p is. They say this leaves BT with net income from the rebate of more than £20/y/ULL. Put another way, this means the ISPs are paying around £180m/y in unjustified costs, which BT can then apply to subsidise downstream products.
They allege that Ofcom ignores this income from the rebate in assessing Openreach’s assets to price LLU. They allege that the resultant prices for LLU are higher than they should be, and that BT’s downstream products benefit from an illegal subsidy. They argue that since BT’s rebate is based on profits, not assets; if Ofcom disagrees, it should get the VOA to change the basis of its rating of BT, and not simply pass the extra costs on to the LLU operators.
Another issue that confuses matters is that Ofcom uses a theoretical all-copper network model for its sums. This disregards the thousands of kilometres of fibre BT has installed in the past five years. Fibre is cheaper to run than copper. TalkTalk’s plea for Ofcom to simply consider the outcomes produced in the market fell on deaf ears.
Ofcom has dismissed the ISPs’ objections, but it did go back to BT for more data about its costs. “We have also carried out a PWNRC (profit weighted net replacement cost) calculation using data on BT’s assets which are more detailed than those published in the RFS…In the light of this, we do not now consider that BT’s 2011/12 allocation of cumulo [business rates] costs to MPF and WLR services is reasonable.
“An allocation which is in line… would result in a reduction in the cumulo costs attributed to WLR rentals from £3.31 to between £2.80 and £2.98 in 2012/13 and a reduction in the cumulo costs attributed to MPF rentals from £3.16 to between £2.68 and £2.85 in 2012/13. We have reflected this reduced allocation in our charge controls,” Ofcom said in the annex.
Ofcom has now published the new LLU charge control decision. It comes into effect on 1 July.
Sky and TalkTalk did not respond to requests for comment.
A decision by the Welsh Assembly Government (WAG) to not release the test methodology and raw test data for the £425m Superfast Cymru broadband project has been referred to the Information Commissioner’s Office.
The complaint stems from a claim by a junior minister that the project had led to more than 100,000 premises being connected at an “average speed of 61Mbps”. It is part of long-running scepticism that the contract will deliver what the WAG has claimed it will, and now subject to audit.
The claim, by deputy minister for skills & technology Ken Skates, was challenged by broadband consultant Richard Brown. Using the Freedom of Information Act, Brown asked the WAG to supply the methodology and the raw test data on which Skates based the claim.
The WAG refused, saying the information would be published at a later date. Brown asked for a review of the WAG’s decision.
Rob Hunter, director of finance and performance in the department of economy science and transport, again refused Brown’s request. He referred to the earlier reason for non-disclosure and added that the information, together with an explanatory narrative, will be published, “probably in summer”, together with a ministerial announcement.
“I am of the opinion that publicly releasing the raw material at this time, without the explanatory narrative and accompanying explanatory ministerial announcement, would cause disruption to the Welsh government’s pre-set programme and the ministerial process in relation to this work in that the raw information, if released prematurely, may be misconstrued and re-published by some, or extracts of the information re-published, in such an ambiguous way as to cause confusion amongst the public and cause disruption to the effective conduct of public affairs.
“To that end, I do not think it is reasonable in all the circumstances or in the public interest to release this information prematurely. Rather, I believe the public interest would be best served if the information were released alongside the ministerial announcement and consultation participation report so that the public can review the information in context. I am satisfied therefore that the balance of the public interest falls in favour of withholding the information.”
In his complaint to the ICO, Brown said, “It does not serve the public interest that a junior minister can make claims in a press release (that is subsequently printed in the press), [but] that the information for testing those claims is withheld until a later date.
“I have been separately informed that the test data is not formed in the manner that has been described, in so much as that the 100,000 connections are not live connections (as described by the junior minister in his release), but are (in the majority) simply theoretical tests that have taken place to establish the possibility of these connections and their speeds.
“Such theoretical connections belies the claim made by the junior minister that the connections are ‘live’ with an average speed of 61Mbps. As such the public interest is in fact damaged due to the claim likely being both false and misleading. The determination to publish the data at a later date, simply moves the ‘proof’ to a later date in an effort to minimise its relevance in informing the public interest.”
Brown noted that WAG had waited until the last possible day to reply to him. “I am of the opinion that this is contrary to the spirit of the act, and is contrary to the commissioner’s guidance, and furthermore is a deliberate attempt to prevent access to information that would be appropriate to informing the public interest.”
In support of his complaint Brown claimed that Hunter’s statement that premature publication could confuse the public was “simply without merit”.
He said, “If this were indeed the case, then a programmed press release by the junior minister would not be possible for precisely the reasons given for not substantiating the claim made by the same junior minister. Further, had the junior minister not made such a wildly unsubstantiated claim in the press, the public interest would not need ‘early’ access to the data to test the claim made.”
Brown believes that Skates’ claims cannot be upheld using the withheld data. The denial on the grounds of future publishing and the unnecessary use of the total time allowance for responses were an attempt “to obfuscate the correct and appropriate informing of the public interest” rather than trying to preserve such public interest as Hunter claimed.
“The commissioner will be aware that such actions are contrary to the act and the deliberate attempt to prevent the legitimate release of information that informs the public interest remains an offence under the act,” Brown said.
Vodafone has called on European regulators to ensure that non-incumbent-owned mobile network operators have access to fibre backhaul on the same terms and conditions as their in-house operators or face a declining competitive ecosystem.
The call stems from a looming shortfall in microwave capacity and prohibitive pricing of incumbents’ fibre, poles and ducts to cope with the fast-rising volume of data traffic.
Research by Analysys Mason commissioned by Vodafone found that incumbent operators favour their in-house mobile operators when it comes to accessto a fibre-based backhaul. “These inputs are not always made available to competing operators as a wholesale or retail product with the desired interface, quality, speed or price.
“The fact that the required inputs are not available, or are extremely expensive, may dampen competition in the mobile market in some countries because the fixed incumbent operator is usually (with the exception of the UK) also a major mobile operator and can gain benefits as a result of this vertical integration – specifically the much greater capillarity of its fibre network,” it said.
The leased line market, in which the mobile operators are a large segment, contributed £2bn/y to BT’s £18bn turnover, the researcher found.
Ben Wreschner, who leads Vodafone’s regulatory economics section, said all Vodafone wants is access on equal terms and conditions as the in-house mobile operator. He said Vodafone accepted that there couldn’t be a single price across Europe, if only because labour prices differ. Instead he called for a harmonised approach to access to fibre for mobile backhaul.
He called on the European Commission to provide guidance to BEREC, the European telecoms arch-regulator, for directives that national regulatory agencies (NRAs) can implement to give effect to this.
The study showed that independent mobile operators use microwave extensively to backhaul their traffic. But they are running out of spectrum. The shift to small cells for LTE traffic is quickly eating up the available capacity. Vodafone’s preliminary report for 2014 revealed that 4G smartphone users use about twice as much data as 3G users, mainly to stream video. Smartphone penetration in Vodafone’s European markets is around 45%. Both factors are pushing mobile operators toward fibre, which has the required capacity to ensure an acceptable user experience.
The MNOs’ options are to switch to so-called E-band microwave in the 60-90MHz band, which due to rapid attenuation of signals, will require many more sites to be rented; to rent access to commercial fibre where available; to rent regulated fibre from the incumbent operators, or to build their own fibre networks.
Vodafone has bought some of its own fibre backhaul (eg Cable& Wireless), but it has cost billions and doesn’t always cover the cities where demand is greatest. Building new fibre would duplicate existing fibre networks, take a long time, and cost a lot more on top of their expensive mobile licences.
Last week Ofcom said it would give BT a further period of non-regulation of fibre prices for high speed (above 1Gbps), where it holds an effective monopoly outside London. It also promised to rule soon on a TalkTalk complaint that BT operates an illegal margin squeeze on fibre prices.
Wreschner said he was watching the margin squeeze decision with interest, but stressed that that is a different market (retail) to Vodafone’s concern (wholesale) about backhaul. “We think the wholesale market needs specific regulation,” he said.
This is why, although they face similar problems as altnets trying to provide fibre to rural homes and businesses, the mobile industry did not speak out when the BDUK process was being set up, he said.