The state aid supported Cotswolds Broadband CIC project, which is supposed to be deploying a new mixed Fibre-to-the-Premises (FTTP) and Fixed Wireless broadband network to rural premises in West Oxfordshire (England), has been “terminated” following a supplier dispute.
The project, which was acquired by Gigaclear just over a year ago after initially being established by Hugo Pickering, originally aimed to ensure that an additional 6,000 or so properties in West Oxfordshire would gain the capability to connect at 24Mbps or greater speeds, with the deployment phase beginning in May 2016 (here) and completing by May 2017 or possibly sooner.
The related contract was supported by an investment of £1.6m (grant) from the Government, as well as £1.6m in the form of a loan from the West Oxfordshire District Council (WODC) and £3.2m coming via private investment from rural fibre optic ISP Gigaclear. However we haven’t seen any major updates on the roll-out since last May and the deployment plan on their website is dated from 2014 (here), which may no longer be relevant.
On Saturday ISPreview.co.uk became aware that there might be a problem after one of our readers received the following response from Gigaclear last week when enquiring about the project’s status.
Gigaclear Statement on Cotswolds Broadband
Cotswolds Broadband has been working closely with West Oxfordshire District Council and BDUK, the Government body responsible for national broadband delivery, to provide full coverage of superfast broadband across the West Oxfordshire.
Unfortunately, the project is currently on hold, while we work to resolve issues with our supplier. Due to the commercial sensitivities involved, no further comment can be made until this process is complete.
All parties are keen to resolve the situation as quickly as possible and will issue further information as it becomes available.
The Cotswolds Broadband project has always been a bit vague when it came to the detail, which made it difficult to know what local homes and businesses could expect to receive or when. A detailed roll-out schedule was promised last year, but it never emerged and we still don’t know what the final fixed wireless products will look like (note: the FTTP side will most likely reflect Gigaclear’s own Gigabit capable packages).
According to the original tender, the supplier involved is the ITS Technology Group and we are attempting to clarify this (we recall the earlier Fibre GarDen dispute in Cumbria), but so far we’ve only been told by Gigaclear’s PR firm that the West Oxfordshire District Council will be “issuing a statement shortly.” We understand that the statement is due sometime early this week.
Expect further updates as we learn more about this breaking news story. It may also be worth pointing out that WODC, like many UK councils, is currently suffering from strain on their budget due to Government cuts and past council tax freezes (here).
We’ve noted that ITS Tech’s accounts appear to be overdue and their financial situation may be under a bit of strain (here). Meanwhile one of our readers has also discovered that ITS Tech was last year spotted on the Companies Court Winding Up List (CR-2016-004108), but that was only an application and so far it doesn’t appear to have gone any further (i.e. an agreement may have been reached to resolve the problem).
So far we’ve yet to get a full statement from any of the parties involved.
UPDATE 10th Jan – 3:24pm:
We’ve had an update from ITS Technology on the winding up petition mentioned earlier. The good news is that this isn’t related to the current situation in West Oxfordshire.
The winding up petition stemmed from an overdue payment issue with HMRC in August 2016, which is said to have occurred because of an incorrectly reported amount of VAT that was still in the process of being disputed.
We are told that the judge advised both parties to resolve the matter within 90 days and to agree the correct amount. Both parties later resolved the issue and the outstanding amount was paid in full, thus no further action was taken.
UPDATE 12th Jan – 10:15am
We’ve just been informed via a joint statement that the contract between Cotswolds Broadband and ITS Technology Group for the delivery of superfast broadband to West Oxfordshire has been terminated by mutual agreement. Cotswolds Broadband has therefore “regretfully decided to withdraw” from the West Oxfordshire Superfast Broadband project.
Steve Brealey, Cotswolds Broadband Project Manager, said:
“The decision to withdraw from this project was not an easy one to take but there were no other options available. We have contacted all residents who have placed an order or have registered an interest to advise of the situation.”
David Cullen, Director of Regulation and Strategy at ITS, said:
“ITS have worked hard with all stakeholders in an attempt to explore alternative options, however no viable solution could be found.”
So far no public money has been spent on this specific project and West Oxfordshire District Council are still said to be “committed to securing superfast broadband access for everyone in the district“.
UPDATE 12th Jan – 11:38am
The West Oxfordshire District Council has now chimed in to confirm that they and the Government’s Broadband Delivery UK programme are “determined to ensure superfast broadband coverage is available throughout the entire district as soon as possible” and have confirmed that public sector funding remains available to make this happen.
In keeping with that the WODC is commencing a new project immediately. This will start with a formal Open Market Review (OMR) followed by public consultation to determine, with as much accuracy as possible, which premises need connections. The Council will then procure a new supplier. It is estimated that this process could take in the region of 6 months, with the build phase starting 3 months after that (i.e. end of 2017).
Cllr Colin Dingwall, Cabinet Member for Broadband at WODC, said:
“It is very disappointing that Cotswolds Broadband’s project failed after so much hard work. The delay for residents is really frustrating. Taking on the procurement process ourselves demonstrates that we are absolutely committed to securing superfast broadband access for everyone in the district as soon as possible.
We are working very closely with BDUK on the new project and are confident that it can be delivered successfully.”
Whilst the broadband project procurement and delivery phase is taking place, those individuals and businesses with little or no connectivity (under 2Mbps) can also apply for a subsidised basic service through the Government’s Better Broadband Scheme. More information, including an application form, is on the Better Broadband for Oxfordshire website.