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Does the City of Derry Deserve its UK UltraFast Broadband Funding Boost

Friday, December 7th, 2012 (8:20 am) - Score 859
derry uk

This week the UK government awarded £50m to help twelve “smaller cities” expand the coverage of “ultra-fast” broadband (80-100Mbps+) and “high speed” public wifi services into neglected areas. But some of the cities, such as Derry in Northern Ireland and Portsmouth in England, already have near perfect availability of “superfast” connectivity.

According to Ofcom’s latest data, the city of Derry (Londonderry) has the highest availability of superfast broadband (25Mbps+) services in the entire United Kingdom with a score of 99.1%. It was also one of the first to see all of its street cabinets upgraded to support BT’s up to 80Mbps FTTC technology, while Virgin Media’s up to 120Mbps cable platform also has a strong presence.

Derry also has one of the highest superfast broadband take-up rates in the UK (13.90%), although it’s interesting to note that the city’s overall broadband adoption (65.80%) is a bit lower than the UK average of 71% and sadly 12.7% still receive speeds of less than 2Mbps.

Two other cities on the government’s final list, Brighton and Hove and Portsmouth, also have similarly strong levels of superfast broadband availability and take-up. We have no doubt that some cities do have neglected areas, which would benefit from this new investment, yet it appears to be deeply questionable whether those that have been selected actually deserve to be there. The three we mention have also effectively already met the government’s wider 90% availability target.

The council’s Super-Connected Derry strategy states: “Securing funding will make us one of Europe’s most digitally connected cities with city-wide access speeds of at least 80Mbps, with businesses availing of 100Mbps.” On the surface Derry already appears able to meet this goal and next year’s launch of FTTP-On-Demand (available on all FTTC lines) will certainly help, so why the need for extra funding when other cities could be said to have a greater need? Perhaps the council’s reaction to this week’s news can tell us.

Cllr Kevin Campbell, Mayor of Derry, said:

We are delighted that Derry City Council’s bid has been successful. We are confident that we will now be able to support the development of ultrafast broadband networks within a number of key economic development zones across the City (Digital Zones) and put in place the infrastructure required to provide fibre to the premises (FTTP) to make them capable of supporting ultrafast services at affordable prices.”

Sharon O’Connor, Derry City Council Town Clerk, also mentioned that the new investment would allow the town to extend its existing wireless city network and enhance current network capacity. She, like Campbell above, then suggested that the funding could be used to help small and medium sized enterprises with their connection costs (subsidy). We found a similar position in the other two cities mentioned.

Our BT and Virgin Media sources similarly speculated that the money was likely to be used for demand stimulation among businesses, as well as boosting wireless services and existing service speeds. Ultimately we will have to wait to see precisely how much money Derry will receive because it might not represent a huge slice of the pie. On the other hand £50m isn’t a lot of money to begin with.

It’s certainly true that take-up is generally low, although comparatively speaking the three cities we mention actually have some of the highest take-up rates in the whole of the UK. Like it or not we can’t help but feel that the funding for cities like Derry, Brighton and Hove and Portsmouth would be better spent on infrastructure in cities with a greater need or even rural areas.

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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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6 Responses
  1. Avatar DTMark

    It does seem insane. Having to push public money into cities and large towns is a very clear admission of spectacular market failure.

    So, rather than address that, we make it worse, using public money to compete against private investment with the consequent effect that will have on those who were looking to invest their own money and observe what happens when you do.

    This does not appear to have anything much to do with the BDUK mission aims and, rather, flies in the face of them.

    And after putting in all this money, we still don’t have a fibre optic network.

  2. Avatar dragoneast

    When these announcements are made in a Treasury statement rather than by DCMS I can’t help wondering if it’s more to do with trying to impress rating agencies and the markets? In that case is directing monies to marginal upgrading of areas with good connectivity already, in terms of bang for buck, likely to give a good headline in terms of the obsession with speed and the economic hype around the internet: “look how we can compete with the best”? Are the rating agencies and markets that stupid (I think I know the answer: not by that much); or am I just hyper-cynical (I don’t know). There seems precious little to boast about in the British economy right now, so do we have to be grateful for “any port in a storm”, even if its a mirage?

    • Avatar DTMark

      Our government has probably read some books about Keynesian economics and has decided to follow the “spend public money in times of economic downturn” to attempt to force money into the economy. Sadly this is not really Keynesian at all, since that requires the build up of reserves during the better years to deploy them at times like this, while governments just spend all the money they can get their hands on at all times.

      Pushing a billion pounds of public money into a private company does have the potential to make a tiny impact on our GDP. What of course would have been better would have been to harness private investment from multiple sources reducing the cost to the taxpayer, and rectifying the market failure that caused all of this in the first place.

  3. I have some sympathy for the argument in this piece, and certainly, given how sparse public money is these days, I think the real connectivity challenges are in rural areas.

    However, I think the Super-connected cities challenge was not just about connectivity, but about what cities can do with it. Some with already good connectivity might have won resources because they showed they knew what could be done with it and wanted to build on what they are already doing. We need more demonstrators of what can be done using Next Generation Connectivity, and I hope some of these cities are going to be able to provide them.

  4. Avatar Stuart

    You bring up an intresting point re city’s, portsmouth for example has Virgin Media offering high speed access, you then get BT who cover part’s of the city, in some areas you will find nethier will have a decent service in the last few months Virgin have had a total service outage due to hardware issues. BT are planning to introduce Fiber in some areas from December onwards Portchester & Cosham are just outside portsmouth yet they have a very poor service.

    While 30 miles up the country in a small town called Bordon the only option is BT and Fiber is already in use around there.

    I am sure it would be better using the money to upgrade rual exchanges rather than city’s as there is a good customer base in city’s.

    • Avatar DTMark

      I know Bordon quite well, we live fairly near to it. There was work done on putting in some form of broadband network in Bordon years ago, possibly a wireless network, but it died when the person overseeing the potential project moved on 🙁

      Hampshire has the usual incumbents, towns and cities get semi-fibre from VM and appear fairly well covered, like Basingstoke, Aldershot and Farnborough appear to be, with the usual not-spots where the VM network does not go; towns like Alton have patchy broadband coverage as they’re BT only – one side of street “up to” 80Meg, the other side of same street just ADSL2+, and outlying areas are too far from the cab to have FTTC anyway.

      It does have one well-known WiFi provider, at least.

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