Cornwall UK Moot Third EU Funded GBP16m Superfast Broadband Rollout

The Cornwall Council in South West England has unveiled tentative plans for a third “Superfast 2” contract (total value of up to £16.25m) to further expand the local availability of superfast broadband (30Mbps+) services to some of the approximately 39,400 premises that have yet to achieve such speeds.

The original £132m Superfast Cornwall project, which was funded by £78.5m from BT and up to £53.5m from Europe (ERDF), has already deployed “fibre broadband” (FTTC/P) services to 95% of the region or 255,500 premises (NOTE: around 90% or 232,000 premises receive “superfast” speeds of 30Mbps+). It’s worth adding that 80,000 of those are covered by Openreach’s ultrafast 330Mbps Fibre-to-the-Premises (FTTP) network, which marks the operator’s biggest single UK deployment of pure fibre optic lines.

But Cornwall’s longer term goal is to reach 99% coverage of 30Mbps+ superfast broadband by 2020 and, as part of the progress towards that goal, they agreed to a £7.6m “follow on” Superfast Extension Programme (SEP) contract through the Government’s Broadband Delivery UK programme in June 2015 (here), which will extend superfast broadband coverage to a further 8,616 premises by December 2017 (the first 1,700 premises are due to be completed by September 2016).

After that it becomes increasingly expensive to tackle the most remote rural areas because such communities can be very small and split up over a wide geographic area (the SEP contract is already said to have average total costs exceeding £700 per premises), which means that any future contracts would require significant additional investment and this is likely to be heavily dependent upon EU funding (a shaky prospect given the upcoming referendum).

The council’s new proposal for a third contract, which is oddly called Superfast 2 (not 3?), estimates that approximately 39,400 premises may be unable to access broadband speeds of 30Mbps+ following the SEP project deployment (FYI – this drops to 22,400+ if you only look at areas with speeds of 15Mbps+) and these are considered “in scope for intervention“.

Council Statement on Superfast 2 Project

It is evident that following the SEP project, there will still be premises that remain outside the fibre footprint, or are within the fibre footprint but unable to access speeds of at least 30Mbps due to distance from the fibre infrastructure. Superfast 2 therefore defines the proposed approach to stage 2 of the Superfast Extension Project, as previously outlined in the Cabinet paper ‘Future Broadband Infrastructure’ (January 2015).

This earlier Cabinet paper identified European Regional Development Funding (ERDF) as the largest potential source of funding for a second stage of investment following the SEP project. A call for proposals for up to £9m of ERDF investment in broadband infrastructure was issued in December 2015 and a Council-led outline application for the full allocation of this funding was submitted by the 31 March 2016 deadline. It is anticipated that an outcome on the outline application will be known by the end of May 2016, at which point an invitation to submit a full application is expected to be issued to a preferred bidder.

The total value of the ERDF application is £14.25m, comprised as follows:

Capital Costs (£13.5m):
* ERDF – £8.4m
* BDUK South West Fund – £3m

Cornwall Council
* CC – £1.1m
* Private sector – £1m (estimated)

Revenue costs (£0.75m):
* ERDF – £0.6m
* CC – £0.15m

It’s worth pointing out that the new funding is, like most such projects, still subject to a new EU State Aid agreement being reached (this is expected around late May or June 2016) and the £3m BDUK funding from the South West Fund is intended to prioritise projects providing “ultrafast” speeds of 100Mbps+ (the council indicates an expectation of more FTTP, but if BT wins the bid then we could also see them using G.fast as the time-scale fits their roll-out).

At this stage there’s no solidly confirmed coverage target beyond the general 99% goal, although the council does moot using a total capital cost of £1,700 per premise, which they suggest could enable Superfast 2 to reach a total of around 8,000 premises (inc. 1,400 businesses). But this is very much subject to change.

On top of all this the council intends to launch two further projects that will aim to help connect those in the final 1% or so of digitally isolated areas. The first is a £0.5-£1m Strategic Business Sites Scheme, which will tactically target businesses that can “demonstrate expected jobs and growth outcomes from access to superfast broadband” (sounds like it could be a voucher scheme) and this is worth an estimated £5,000 per business.

The second project is a £0.5-£1m Community Fund, which aims to help isolated residential communities to find an alternative broadband technology, such as wireless or mobile broadband connections (the example used by the council). The fact that “alternative” tech only gets mentioned for the Community Fund and not the main Superfast 2 contract suggests that the main contract might be aimed squarely at BT. The council also appears to be using an estimate of £1,000 per premise, which suggests that between 500 and 1,000 premises might benefit.

Otherwise the Superfast 2 contract, which could begin in March 2017 and run until February 2020, is due to be debated by the council next Thursday. At present all of the above details are subject to change, especially if the EU referendum results in a BREXIT as that could kill off the main funding (the BDUK investment is linked to ERDF funding).