Following the broadband money

Posts Tagged ‘European Parliament

Serious questions raised over Welsh superfast broadband project

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wales-welsh-flag-16-pThe contract for ‘superfast broadband’ that the Welsh Assembly Government (WAG) has signed with BT will deliver less than politicians have promised in public statements, and appears to deal with BT and Openreach as a single entity in violation of a BT regulatory undertaking to “functionally separate” the two.

It also raises questions about the legitimacy of the money given to BT because of how it will be used.

These conclusions come from broadband consultant Richard Brown who has already asked the European Parliament whether the WAG can use SuperFast Cymru money to overbuild the FibreSpeed coverage area which has already received state aid.

Brown obtained a heavily redacted copy of the ‘Superfast-Cymru‘ contract after an eight month battle using the Freedom of Information Act (FOIA). He says the financial, coverage and timing details of the contract are missing, but what remans is still revealing.

He notes that while the contract is between BT Plc and the WAG, it is signed on behalf of BT by outgoing Openreach CEO Liv Garfield.

“There is a legal governance issue (imposed in theory by Ofcom) that each part of the BT group should have ‘Chinese walls’ between them to prevent unfair exposure to competitive information leaking from one wholly owned subsidiary to another,” Brown says.

“There is a fundamental concern that if Openreach is supposed to be a functionally separate organisation, and the CEO of Openreach is the signatory to the contract then information must (by definition) be being passed between Plc and Openreach, in a manner that has been expressly forbidden by the legal undertakings given to Ofcom.”

Brown says WAG ministers are guilty of overpromising in public what the contract will deliver in terms of speed.Ofcom has accepted the European Commission’s definition of “superfast” to mean download speeds of at least 30Mbps.

“The Welsh Government have not contracted BT to enable the delivery of superfast broadband to premises in Wales, simply that the core infrastructure (exchanges and cabinets) will enable a measurement of premises passed to reach a total of 95% for up to 24Mbps speeds,” he says.

This view is confirmed in Clause 21.4 of the contract: “The Grantee acknowledges that the Welsh Ministers will not pay any contribution or subsidy to the Grantee in respect of the Last Drop Connection” ie, the link between the street cabinet and the premises. This rules out WAG support for any fibre to the premises.

The contract commits BT to meet three targets by 30 June 2016 or at the latest by the ‘Drop Dead Date’, which has been redacted:

  1. 90% coverage of all premises in the ‘intervention area’ at >30Mbps PPiR and a minimum of 2Mbps CIR (committed information rate)
  2. 95% at >24Mbps with a minimum of 0.5Mbps CIR
  3. 40% coverage with >100Mbps with a minimum of 10Mbps CIR.

Brown says Target 2 is dismaying. “At no stage have the ministers ever claimed anything lower than 96% coverage for superfast broadband under this contract. It is clear that there is a degree of wishful thinking by the ministers that BT will choose to deliver more than they are contracted to do.”

Brown estimates 30,000 homes and businesses may be disappointed if BT fails to meet the 96% coverage target claimed by ministers. No-one knows who they might be because the post codes of the coverage area are secret.

Brown further believes there is a difference between what the WAG told the European Commission it wanted state aid permission for, and what it is buying from BT. The European Commission’s 2005 decision on state aid in the case of UK’s Rural Broadband Access Programme made it clear that only capital costs are eligible for state aid.

It said “Eligible capital costs such as investments in communications networks and equipment necessary to provide the requested broadband services have to be directly attributable to the project and incurred during the period of the Broadband Service Agreement. No operating costs will be financed.”

According to Brown, the works that are required under that contract appear to enforce requirements on BT that are explicitly not being paid for.

The Superfast Cymru contract requires BT to supply “Operational Works” that consist of maintenance and wholesale services and the sales and support of wholesale services.

Maintenance covers “updating, maintenance, fault management, performance optimisation (when required) and capacity augmentation.” Wholesale services covers “services to enable retail service providers to provide retail services over the network.”

“The inclusion of the clauses compelling BT to deliver such ‘value added’ services, as opposed to them being part of the funded delivery, lends weight to the likelihood that the ministers have assisted BT in being as tax efficient as possible,” Brown says.

Brown believes taxpayers will have to pay BT’s costs to sell them broadband. Clause 16.6 states “…The Welsh Ministers shall only pay Financial Contributions in respect of those marketing activities that the Welsh Ministers have approved in accordance with the Marketing Plan.”

This clause is wholly inappropriate, says Brown. He says Page 4 Section B makes it clear that the grant is a capital grant to BT on the grounds that infrastructure is being purchased.

“Such a commitment by the Welsh Government gives BT a disproportionate market advantage over other wholesale providers, and as such would be considered a significant influence into the market dynamics.”

Brown questions how much money BT will actually contribute to the Superfast Cymru project. The contract caps The WAG’s contribution at £195m. He notes BT has indicated its total investment in Welsh broadband, including its commercial rollout, is £220m. At Clause 21.5 the ministers “acknowledge and accept that the Grantee has made a contribution of a sum at least equal to the Maximum Grant.” That suggests BT’s extra contribution to Superfast Cymru is just £25m.

On the question of VAT, at Clause 21.11 WAG and BT agree between themselves the the contract does not cover payment in consideration of services to the ministers and that the deal is therefore exempt from VAT.

“BT are compelled to deliver wholesale services as a result of this contract (even to the extent that the Ministers have chosen to engage in price manipulation in the market space). Wholesale service provision as a requirement of the contract, does not allow for the contract to be considered as a ‘capital investment’ only contract,” says Brown.

Summing up Brown says the 96% coverage ministers claim will be delivered “does not represent a percentage of homes and businesses that will receive superfast broadband/fibre broadband. The measurement is solely on premises passed. Premises passed is a measurement of presumed capability that considers only the core infrastructure.

“This utterly ignores the capability of the line between the exchange/cabinet and the premise to deliver the faster services.”

Brown referred to the Aus$24bn Australian National Broadband Network, which also used premises passed, and which the head of BT’s NGA rollout Bill Murphy has branded a failure on Twitter.

Brown says “In August the industry press was awash with headlines … which suggest that there are approx. one third of all the (Australian) premises passed that are unable to gain access to the increased service speeds.

“Premises passed is simply not a measure of the amount of the population that will be able to gain access to improved services. It is simply a measure of the capability of the core network – something that will not change Wales’ future, but will certainly enhance BT’s.”


Written by Br0kenTeleph0n3

2013/11/24 at 22:51

What’s in Google’s new privacy rules for you?

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Google’s new privacy policy (basically Google will dump all it knows about you, including the content of your emails, in a single file so that it can use the metadata it extracts to serve advertising to you) has made some people feel uncomfortable about it.

What about the new EU idea about the right to be forgotten, or the old one, to have multiple online personalities?

Google says doing what it wants with your (or my) online record will result in a better search experience for the billions of people who use it daily.

What’s in it for Google is clearly more billions of advertising money. So what’s in it for you and me? Well, Google didn’t know, or at least it doesn’t provide the answer in the first page of search results.

Instead it suggested the thought-provoking introduction from RedTape’s Verisign hack story, “It should be clear by now that nothing online is sacred…”

I prefer to have a disaggregated identity when I’m online. In other words, I like the anonymity that goes with being a dog, unless I explicitly make my identity (and my preferences) available. I don’t think Google or anyone else should be messing with that.

Neither does Mirjam Remie, who writes for Bits of Freedom, a Dutch website. She’s trying to live Google-free for a week.

Here are some of the alternative tools to Google’s she says she may be using, in case you’d like to try them too.

Search: DuckDuckGo, Start Page, Scroogle
YouTube: Vimeo, Metacafe, Break, Dailymotion
Google+: Facebook and MySpace (poor options from a privacy point of view), Diaspora

Google Chrome: SRWare Iron, Firefox, RefControl, Safari, Ghostery (add-on)
Gmail: Hotmail, FastMail, Neomailbox, Lavabit and GMX

Google Maps: OpenStreetMap, Nokia Maps


Written by Br0kenTeleph0n3

2012/02/05 at 19:35

Learning to love Big Brother

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There have been startling developments in the field of online copyright in the first few weeks of 2012.

Yesterday saw the European Parliament’s rapporteur, Kader Arif, hand back the dossier on the controversial Anti-counterfeiting Trade Agreement (Acta). Arif’s job was to shepherd it through parliament so that member states can get on with enacting it.

Arif said he was no longer prepared to be part of the “masquerade”, and denounced the process that had brought Acta to the point where yesterday 22 countries signed up to it.

This followed less than a week after the US Congress withdrew two bills to clamp down on online copyright infringement, and the FBI shut down MegaUpload, a website that allegedly traded or pointed to infringing copyright material.

In the past week, the music industry produced figures that showed that while sales of CDs were down, legal digital downloads were at record levels.

Meanwhile, the UK government has asked former Ofcom boss Richard Hooper to look into the feasibility of setting up a digital copyright exchange, where creators can license their work to others who want to reproduce or reuse and distribute it.

All this follows the abortive eG8 meeting last year, where “new media” representatives crossed swords with advocates for harsh penalties for copyright infringers.

The copyright issue is simply this: people who were prepared to invest bought the right to copy and distribute the original work from the creators. The machinery, materials and transport were relatively expensive, too much so for most individual creators. But thereafter the rightsholders enjoyed an effective monopoly on sales of the work, and made a lot of money from it. The internet threatens that monopoly because digital content is easy and cheap to copy and distribute by anyone with a computer and internet access.

This is not a new problem. The music industry in particular has gone a long way to coming to terms with it, even if it doesn’t like giving 30% of the sale price to Apple for stuff sold through iTunes. So the question is why it is suddenly big news?

Deep in the heart of the debate is the issue of control of the internet.

The concerns of the rightsholders are valid, but they are a sideshow. Much more important, in some circles, is to legitimise the power to censor content on the internet and to monitor troublemakers.

There can be few governments that looked on the Arab Spring, and not shiver at how fast legitimacy can wash away. Wikileaks’ release of official video footage that showed the apparent murder of civilians by US armed forces shocked millions. Wikileaks’ subsequent release of embarrassing diplomatic cables, and the reaction to it, showed how potent the net is in helping to shape public opinion. For most governments, it is simply too dangerous for the internet to be left uncontrolled.

So governments are content to let or even encourage the music and film industries to make the running for the legislation to shut down offending content and websites. The faceless MEPs in Brussels offer a convenient mask, as Arif says.

Forget about copyright piracy – it is a red herring. This is really about political control of the net. No doubt, like Winston Smith, we may all have learn to love Big Brother.




Written by Br0kenTeleph0n3

2012/01/27 at 08:02

Dodgy doings in defence of copyright

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Music rightsholders have shown a remarkable willingness to indulge in questionable tactics to preserve and extend their control of digital content.

First we had Lord Peter Mandelson’s Corfu lunch with Hollywood oligarch David Geffen that led to the sudden and unexpected inclusion of “three strikes and out” provisions in the Digital Economy Act.

Now TorrentFreak, a website that watches the battle between rights holders, copyright pirates and other interested parties, is following the saga of how Universal Music got YouTube to take down a promotional video for Megaupload, a free online file storage service, that was going viral.

The catchy Mega Song, which features music artists like Blackeyed Pea , P. Diddy and Alicia Keys, has been up and down and up again on YouTube as the legal arguments have flowed.

The takedown seemed possible thanks to a side deal between YouTube (owned by Google) and Universal that allows Universal to get YouTube to take down material to which it does not own the copyright.

This goes beyond the ambit of the Digital Copyright Millennium Act (DCMA), many of whose provisions are written into the Anticounterfeit Trade Agreement (Acta), which is now in the European Parliament for a vote. Acta is a rightsholder-sponsored multilateral deal that activists claim would not pass public scrutiny.

Taken together, Acta and the Mega Song case sheds an interesting light on the motives of music rights holders.  They would make rightsholders key gatekeepers in the emerging digital economy as broadband access to digital content expands.

The UK government is fighting back, somewhat, with its consultation on a new copyright regime in the light of the Hargreaves Commission report. This would allow private copying eg from a CD you own to an MP3 player, greater access to “orphan works” i.e. work for whom ownership cannot be established, and non-commercial data mining of academic works.

Perhaps most interestingly, it has already asked Richard Hooper to do a feasibility study to test a key Hargreaves recommendation, a digital rights exchange, to reduce the friction and cost of buying online rights.

On the face of it, this would be a good or better deal for artists. According to the Bemuso blog, artists might earn five pence from a 79p digital download, and rightholders 46p. The exchange would allow them to sell rights directly, and possible earn more than what they can earn via the rightholders, without having to sign away their copyright to record labels.

If government has been slow to change the status quo and seem to be siding with rightsholders, Bemuso shows why: after the rightsholder, the next biggest beneficiary is the government.

Written by Br0kenTeleph0n3

2011/12/17 at 20:03

Online sunshine leads to better behaviour

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ITU secretary-General Hamadoun Touré is not given to exaggeration, so it’s interesting to hear him warn governments not to mess with the internet.

Cut off access at your peril, he says. Which is not news to presidents of Egypt, Tunisia, Bahrain and Syria, among others, but may come as a bit of surprise to the heads of western nations.

Reason is simple: people regard access to the internet as a human right, something the UN endorsed last week, so mess with that, you are messing with something people hold personally very dear, even if they don’t use Facebook quite as much as they used to.

Which is why Touré is calling for a common code of conduct negotiated between governments, ISPs, the security mob, civil society and users. We can all (mostly) agree online kiddie porn is a no-no. But reading the Wikileaks cables is a matter of debate.

With the UK thinking of filtering and blocking websites to prevent us all from turning into terrorists, perhaps the government needs to pause to consider alternatives to co-opting the ISP community to block stuff it considers objectionable.

To quote US judge Louis Brandeis, sunlight is the best disinfectant. Access to information via the net is clearly online sunshine.

Perhaps, as Touré says, access to the net will help all of us, governments’ included, behave better.

Written by Br0kenTeleph0n3

2011/06/14 at 21:27

Kroes wants more spectrum for fast mobile broadband

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More harmonised spectrum for high speed mobile broadband is what Europe’s Digital Agenda boss Neelie Kroes will ask from the EU’s council of telecoms ministers meeting in Brussels tomorrow.

Kroes will will ask the European Parliament to adopt legislation that make radio spectrum available for wireless broadband by 2013.

According to the commission, businesses that reply on access to spectrum supports 3.5 million jobs, generates around €130bn a year in tax and contributes €140bn directly to European GDP.

She will also present the net neutrality rules that came into effect on 25 May, and discuss how to achieve the Digital Agenda goals of 30Mbps  basic broadband access for all by 2013, with 50% having access to 100Mbps by 2020.

The council is expected to agree to the commission’s proposal to extend the current mandate of the European Network and Information Security Agency (Enisa) by 18 months. But there are calls for the Crete-based think-tank to be updated and upgraded.

Kroes will urge ministers to improve and strengthen their national cybersecurity defences, and update them on developments on roaming services in the EU.

Online copyright laws are premature, say telcos, ISPs

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European communications providers and internet service providers (ISPs) yesterday condemned European Commission moves to protect online content, saying they were were “premature”.

In a joint statement, Cable Europe, ECTA, ETNO, EuroISPA and GSMA, welcomed the search for search for a “holistic” solution, but regretted that the Commission seemed  “pre-disposed to revise the IPR Enforcement Directive 2004/48 (IPRED) at this premature stage”.

Too little had passed from the directive’s transpostion into national law, it said. “Consequently, there is insufficient evidence at this stage to suggest a real necessity for a revision.”

Premature changes risked stifling innovation and the development of new models by which creative people could build new businesses and jobs, they said.

The signatories worried that the commission planned to force ISPs to police their internet traffic for illegal downloads, and that this could make them liable for charges of illegally infringing their customers’  privacy, and the entire process was outside judicial oversight. .

The statement highlights background to an opinion expressed by the commission’s Digital Agenda head, Neelie Kroes, at the E>G8 conference in Paris this morning. Kroes said the present copyright regime was unfit for purpose in the digital economy and needed to be updated.

Several (US) speakers from the E>G8 floor praised the recent Hargreaves review, the UK’s effort to update copyright for the digital economy. It was “less moralistic” than yesterday’s heated debate on the subject, said one.