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Europe Aims to Cut Superfast Broadband Rollout Costs by 25%

Friday, April 27th, 2012 (12:08 pm) - Score 820
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The European Commission (EC) has today opened a new consultation that aims to cut the costs of broadband investment by 25% and thus make it cheaper to deploy new networks for “high speed internet” in the EU. Priority will be given to reducing the costs associated with civil engineering (i.e. digging up roads to lay fibre optic cable), which can account for up to 80% of the total cost.

The consultation is part of Europe’s wider Digital Agenda, which aims to ensure that everybody in Europe has access to superfast broadband speeds of 30Mbps+, with 50% or more EU households subscribing to speeds above 100Mbps, by 2020.

Neelie Kroes, EC Vice President, said:

We need to cut the engineering costs of rolling-out broadband networks if we want to spread faster broadband across Europe. We need to test practical ideas on how to cut costs and how to make it easier to access, re-use and share this infrastructure. There is nothing more annoying for citizens than road-digging, and nothing more annoying to businesses than pointless red tape.”

Kroes points toward several key areas that could help to bring costs down including better coordination of civil engineering projects, insufficient re-use of existing infrastructure, lack of cooperation between the various actors (e.g. utility firms often have their own infrastructure and dig up roads without coordinating with telecoms firms) and cumbersome procedures for clearing rights of way.

The public consultation runs until 20th July 2012, although we’re a little surprised that it’s taken the EU this long to consult on the issue. In the UK Ofcom has already done some work on this but there’s certainly room for improvement, not least with road work taxation.

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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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15 Responses
  1. If anyone would like to contribute to this discussion please jump in here, or also at the #da12bb hashtag on twitter, or on the high speed broadband portal which is feeding your views to the European commission. You can find it here: http://daa.ec.europa.eu/group/2/content – the workshops will discuss your comments, so do make them and let your voices be heard. I am one of the online animators for the event and will make sure your points of view are made, whether I agree with them or not. This is our chance to get grassroots knowledge to the decision makers. Let us not waste it. Europe is listening.

  2. Avatar What?

    Remove fiber tax

    • Removing the VOA fibre tax is a great idea, and one that many companies have been pushing government to do. A level playing field would help them get a foothold in the market, which is currently cornered by the incumbent. Witness the ‘superfast cornwall’ saga, where fibre could have been deployed in many areas by various companies, but can’t because of the tax. So Cornwall get cabinets and ‘alternative technologies’ aka BET and Satellites in rural areas. or wifi. Courtesy of BT. (who don’t have the burden of laying and taxing new fibre as its stitched up as a package for them)

  3. Avatar New_Londoner

    The apparent “advantage” on the VOA “fibre tax” has been tested and disproved in court several times, so is simply an urban myth that refuses to die. In any case, its existance or otherwise has no bearing on reducing the cost to deploy next generation access networks as it is levied on the network once it is installed.

    A more relevant area to explore is the growing mountain or red tape as new measures like permit schemes, even lane rental are introduced into the UK, making roadworks ever more expensive and time consuming. So ironically measures currently being introduced in the UK will actually have the effect of slowing down deployment and making it more expensive. Given the EU initiative mentioned above, these ought to be challenged.

    Bearing in mind that the labour costs form a large % of the total cost, anything which can be done to remove needless bureaucracy, streamline the actual build element of the roadworks will help to reduce costs.

    • Avatar Somerset

      So which is correct? What difference would changing fibre tax make, numbers please.

      So why were these companies set up despite knowing how the industry works. Or was it the belief that eg. PIA would be free and BT would pick up all the costs plus allow untrained people to access their poles and ducts. Similarly that the power companies would allow cables between their poles.

  4. Avatar Legolash2o

    Either way, regardless if BT have an advantage or not, everyone would benefit from the removal of fibre tax.

    • Avatar New_Londoner

      Fair enough but it does say above that “Priority will be given to reducing the costs associated with civil engineering (i.e. digging up roads to lay fibre optic cable), which can account for up to 80% of the total cost”, so there are much bigger issues to tackle anyway.

  5. Avatar What?

    Maybe if BT or others used a process like this: http://www.samarais.com/en/our_offers/the_range/micro_trenchers.html?idMachine=15 it might bring down costs too. Dark Fiber Africa are using it to deploy their cables http://www.dfafrica.co.za/metro_trench_process_dfa.php

  6. Avatar zemadeiran

    Chris,

    How about using the UK’s canal network as a backbone?

    Fiber in cities should really use existing conduits where possible, hmmmmm let me think….

    Maybe the victorians had the foresight to build us a multi function access and distribution system safe from roadworks, lightning etc

    they did!

  7. Avatar DTMark

    Odd to read some of the things I’ve been saying for years… some joined-up thinking, bt at a rather late stage.

    Consolidation of street ducting and furniture facilitated, rather than frustrated by local authorities, all charges removed for digging up streets etc to get all new ducting laid (I’m presuming that this would save a fortune in cities like London with the cost associated with ongoing road digging per each utility)

    Removal of fibre tax

    Tax incentive to businesses who supply FTTP to each new customer for first 3 years

    Ducting remains public

    All the fibre laid remains private (to whoever laid it)

    Private fibre operators given guarantees regarding pricing, if any, and a perpetual lease contract

    Existing operators (any utility) can “donate” some of their present ducting to the project (not for free) as long as it’s good enough quality and usable

    Existing networks can connect to it at various points of presence

    Reward for fibre laid as ducting is put down – incentive for operators to get in then

    Probably not much to excite the smaller ISPs though perhaps someone like Zen might then like to expand their limited LLU to local fibre (Rochdale is it?). But if they don’t get together and build something, I fear for their longer term future.

    This all strikes me as step 1 of any long term, strategic delivery project – solve the delivery routes/mechanism and the tech first by removing the same obstacles that have always held it up (this approach also removes the biggest one, which also impacts France, from what I read – that of a single major incumbent player having an advantage because it is a state monopoly turned private monopoly).

    Government *facilitates* rather than hinders for once, and the motives of the players are incentivised correctly towards the goal.

    • Avatar Somerset

      Please describe how you propose that all ducting belonging to BT, VM, C&W, Global Crossing etc. is taken into public ownership. Who would then manage and maintain it, including unblocking?

      ‘Reward for fibre laid…’. From who?

  8. Avatar DTMark

    I don’t propose that anything is forcibly taken from anyone nor that it is given for free. In essence, “we” (the taxpayer) paid for the phone lines to be put in place, we also paid for the ADSL DSLAM in the exchange, I think, in this area, though I could be wrong about that.

    We then sold all the infrastructure we’d built, the scale of which is perhaps only really possible as a State project, to a private company. We have no control over it, though the uncomfortable monopoly situation this created in the short-term grab by the government for some money meant we then had to “regulate” so a private company doesn’t actually have full control over its own assets. Moreover it’s then forced to lease them and to share the benefits of upgrades with competitors.

    It’s a farce. “You couldn’t make it up”.

    In the meantime, another private company, if memory serves, had too ambitious an expansion plan and nearly or actually bankrupted themselves (was it twice?) because the cost of laying their own ducting alongside the ones we’d already built was too high. That being the main issue holding back the progress of broadband.

    In terms of duct sharing, I’m suspecting the age of the old GPO ducting means some of it will have collapsed by now and need work. FTTP in Milton Keynes went on forever (it it still going on?) thanks to collapsed ducting and that can’t be that old, since Milton Keynes isn’t that old. Hence the “PIA” arrangement – not only do we pay to lease the thing we built back again, we all pay to repair it as well. At this point, while I’m a long way from being a socialist, you have to question what was privatised – really, it was just the profit – and whether all of the above benefits the customer most especially if broadband is to be considered a “utility”.

    Some suggest forced renationalisation (something we’ll eventually have to do with all our energy utilies eventually, though that’s a separate longer political debate!), I’d propose recapitalisation.

    As far as “Who would manage the ducting”, I don’t like Governments being near tech things. But even our local council could, I’m sure, organise a ducting network. Just basic building. It can’t be rocket science. A call centre with database of roads and a calender liaising with local councils? I don’t do this sort of thing, but how hard can it be..

    The above isn’t supposed to be a carefully costed proposal or “white paper”, it’s what I believe should have been the *start* of the broadband delivery project to get the foundations of it right, not thinking about this later on after assigning a pot of money without knowing how much it will cost to deliver the actual aims of the project.

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