UK Government Black Marks Fujitsu Superfast Broadband Bids as High Risk

The governments Department for Culture, Media and Sport (DCMS) has confirmed that Fujitsu UK, which alongside BT is one of only two telecoms operators bidding for major national superfast broadband deployment contracts, is now classified as “high risk” and thus subject to additional scrutiny.

Fujitsu’s change of status follows an FT article earlier this week, which revealed that the Japanese firm had been classified as “high risk” following problems with an unrelated £900m NHS IT contract. At the time it wasn’t known whether this also applied to the group’s telecoms division, although apparently it does.

DCMS Statement (The Register)

“The suppliers appointed to the BDUK framework are Fujitsu and BT. Frameworks are within the scope of HMG’s supplier performance policy, and any supplier identified as high risk will be scrutinised particularly carefully before the award of further work.”

The situation is particularly thorny because of Europe’s on-going competition concerns with the related Broadband Delivery UK (BDUK) process. The European Commission (EC) is currently delaying the release of state aid funding by the UK government, which is believed to be affecting nearly thirty Local Broadband Plans (LBPs), until its concerns have been addressed (e.g. lack of competing operators, no Dark Fibre access, sub-30Mbps speed targets etc.); that decision is expected this month.

Meanwhile BT is continuing to win all of the announced BDUK contracts, picking up another two for Norfolk and Cumbria today, while Fujitsu’s alternative rural FTTH network proposal is increasingly beginning to look more like a patsy for helping to convince Europe that BT has some competition.

Today’s news will have the impact of making Fujitsu’s proposals even less attractive to local authorities but it won’t block them from bidding, at least not directly, as some other reports have suggested. In practical terms it won’t make much difference anyway since most already expect BT to win the lion’s share of public funding, although it could fuel the fire for those demanding change in the existing process and that might be a good thing (e.g. open it up to smaller operators).