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UPD Budget 2012 Confirm Final 10 UK Cities for £100m Ultrafast Broadband Fund

Wednesday, March 21st, 2012 (1:33 pm) - Score 1,403
broadband east london uk skyline

The UK governments Chancellor, George Osborne MP, has this afternoon presented his annual Budget 2012 announcement to the House of Commons (Parliament) and confirmed which 10 cities can now expect to get “ultrafast” broadband ISP services and “high speed public wifi” through the £100m Urban Broadband Fund (UBF). A further £50m has today also been allocated for a second wave of “smaller cities“.

The “super-connected cities” fund, which was announced as part of the governments £30bn National Infrastructure Plan (NIP) last November 2011 (here), aims to make “ultrafast” fibre optic based 80-100Mbps+ (Megabits per second) broadband ISP services available across each of the 10 largest cities listed below (including the UK’s four main capital cities) by 2015.

The UK Chancellor, George Osborne, said:

To be Europe’s technology centre we also need the best technology infrastructure. Two years ago Britain had some of the slowest broadband speeds in Europe; today our plans will deliver some of the fastest – with 90 per cent of the population having access to superfast broadband, and improved mobile phone coverage for rural areas and along key roads across the UK.

But we should not be complacent by saying it is enough to be the best in Europe when countries like Korea and Singapore do even better. So today we’re funding ultra fast broadband and wifi in ten of the UK’s largest cities [listed below].

My HF for Brighton Kempton asked me to help small cities too – no doubt with his own city in mind. I agree. £50m will be available for smaller cities too.

The fastest digital speeds in the world available in our cities, with the most connected countryside in Europe – and the most creative digital content anywhere. That’s what a modern industrial policy looks like.”

Crucially the money will only work to upgrade broadband (fixed line and “city-wide” mobile) “coverage in areas where BT and Virgin Media will not go” or services “beyond what the [Private Sector] will provide“. But many continue to question why public money is needed in dense urban areas where the case for private sector investment should be significantly easier to make.

The Final 10 Urban Broadband Fund Cities (Potential Funding Range)
* Edinburgh – Capital of Scotland (£8m-£11m)
* Belfast – Capital of Northern Ireland (£6m-£13.7m)
* Cardiff – Capital of Wales (£7m-£12m)
* London – Capital of England (£10m-£25m)

* Birmingham (£7m-£10m)
* Bradford (£10m-£14.6m shared with Leeds / joint bid)
* Bristol (£4.2m-£12m)
* Leeds (£10m-£14.6m shared with Bradford / joint bid)
* Newcastle (£4m-£6m)
* Manchester (£12m)

Sadly the other short listed cities of Sheffield, Nottingham, Liverpool and Glasgow were not chosen. In fairness it’s often overlooked that large sections of our major cities, such as significant chunks of London’s South East corner, can and do suffer from poor broadband connectivity and sub-2Mbps speeds.

Dana Pressman-Tobak, Managing Director of Urban ISP Hyperoptic, commented:

There are big questions to be asked following the Chancellor superfast broadband city proposals. It’s clear that there is a need to improve broadband speed and quality for both consumers and businesses, especially in light of recent reports that the UK’s economy is evermore relying on eCommerce; the UK currently ranks number one in all G20 nations in terms of the amount the internet contributes to its GDP.

But in order to compete in a global broadband arena the government needs to take a long term view and focus on encouraging broadband providers to adopt fibre-to-the-building models in cities. Anything less is not ideal. Currently providers are taking their time adopting this approach, because they don’t want to cannibalise their customer base and the technology is not compatible with their legacy network.

Hyperoptic, as the first broadband provider to make 1 Gig happen in the UK, is already rolling out fibre-to-the-building across London and giving customers hyper-fast speeds. Such is the strength of the commercial case, Hyperoptic will be announcing our national roll out strategy to other cities later this year. If the Government has £100 million to spare then we would advise that it puts the funds towards rural broadband projects, where the commercial case is far weaker.”

The National Infrastructure Plan claimed that “the age of some networks and the dense pattern of urban development in the UK combine to pose challenges,” but at no point did it provide an adequate explanation for why the private sector had failed to resolve this in areas where there is usually no shortage of customers.

Separately the extra £50m that has today been allocated for broadband in smaller cities remains somewhat of a grey area and, after having skipped through the official documentation, we’re none the wiser. It only receives the vaguest of mentions. We did find that the money for it will come from the 2013-2014 tax year.

UPDATE 2:20pm

Added the government’s minimum to maximum (range of possible awards) funding for each city above.

Further details, including for the governments £150m Mobile infrastructure plan, can be found here:

http://www.culture.gov.uk/news/news_stories/8931.aspx

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Mark Jackson
By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.
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12 Responses
  1. Avatar Andrew Crawford

    Last time i checked London is not a officially a city as it not been given city status by the queen

  2. I suspect nobody will pay much attention to that because it’s a bit silly 🙂 .

  3. Avatar Phil

    What a loads of silly really! The government haven’t got any clue at all!

  4. Avatar dragoneast

    The Government seems to ignore commercial roll-outs other than BT such as Hyperoptic in London (and possibly other big cities), Rutland perhaps and others; and WiFi + fibre in rural areas. Why?

  5. Avatar Kits

    If the government are going to put such large sums of money into this most would go to BT will the CEO and other high management of BT stop taking such large bonuses?

    The amount being put in place perhaps this company shouldn’t be private anymore as it has failed to keep up with modernisation at the expense of bonuses to management.

  6. Avatar DTMark

    So in one statement, the Chancellor admits market failure, and then in the same speech mentions throwing money at the problem without any real understanding of why broadband has failed so spectacularly (“the age of some networks” is a big clue, but then that’s disingenuous, we’re talking about a phone network that’s probably 100 years old, not a broadband one at all, we’re still to start building one) and miserably in this country and will continue to do so, to cost us more, and to deliver less, until that market failure is addressed. As usual, Hyperoptic are spot on.

  7. Avatar DTMark

    @Kits – yes, but then, if you were BT, and you have half the country as a captive market with no network competition, and you can charge £16 a month or whatever the line rental is, and you can collect that month in, month out, rising year on year…

    Why would you invest? You have a monopoly. You’d have to be mad to invest anything. Instead, you’d sit back and wait for a sniff of government money, then you’d start making noises about potentially being able to deliver something, even though you’ve done absolutely buggery for the last decade and invested not one single penny in the last mile since it was privatised.

    Once you get the cash in for that, you then pick and choose random target areas so as to take market share from a competitor, generally leave out businesses where you can, and wait for the begging bowl to go around again.

    In essence, all we did was turn a State monopoly into a private one, which is even worse since we have no control over it.

    • Avatar New_Londoner

      Quote “even though you’ve done absolutely buggery for the last decade and invested not one single penny in the last mile since it was privatised”

      FTTC roll out pre-dates BDUK!

  8. Avatar DTMark

    … “smaller cities”

    Alton, Hampshire please. That’s had it’s FTTC rollout but to residentials only, and only some of those. It needs a serious broadband provider, so I can go lease some offices which are being practically given away at the moment, none of which can get anything other than the now-hilarious “Up to 20 Meg”.

    • Avatar New_Londoner

      So no Ethernet in Alton then? Presumably the rents would increase if the location became more attractive due to fast broadband?

  9. Avatar Deduction

    There is no evidence to suggest fast broadband equals higher property price, be it buying or renting. In fact some of the most expensive property is still in the country and the realm of 2Mb or even less broadband speeds at times.

  10. Avatar zemadeiran

    Lets get back to our roots…

    The industrial revolution started in the UK. A new era of mechanised power and engineering spread across the globe from this small isle.

    BT were ready in the 80’s to roll out FTTH before the government back then decided to stop them knowing full well that privatisation was on the cards.

    BT are holding onto their copper last mile because they have nothing else except copper. Some brave companies have to step up and bypass the BT exchanges and provide localised services and access infrastructure.

    BT are already shitting in their pants, 4G is already around the corner and THEY know full well that their time is up when it comes to the retail consumer.

    BT were very short sited when cellnet was flogged off.

    BT has around 5 years of life left….and it is their own fucking fault.

    Anyone who says different is a wasteman!

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