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Small UK ISP Frustrated at Lack of Public Broadband Funding in Oxfordshire

Monday, December 31st, 2012 (12:02 pm) - Score 1,167

Countryside Broadband, a small fixed wireless broadband ISP (WISP) that delivers internet access to a number of rural areas in South Oxfordshire (England, UK), has complained that it is unable to expand the reach of its network because the government’s public funding is only going towards big providers (e.g. BT).

The tiny service provider currently covers Goring Heath, South Stoke, North Stoke, Ipsden, Moulsford and Kingwood but it would also like to expand into Binfield Heath. Sadly the ISPs requests for support from the government’s Broadband Delivery UK (BDUK) office have so far been rejected.

Bill Pechey, Director of Countryside Broadband, said (Henley Standard):

We are expanding as quickly as we can but find that we cannot access the government funds from Broadband Delivery UK and the Department for Culture, Media and Sport. We have tried to develop a good relationship with Oxfordshire County Council but find that now it has started the process to distribute funds from Broadband Delivery UK we are too small to be considered as a broadband provider.

This illustrates a paradox in that we, almost by definition, best serve the widely scattered and most disadvantaged but do not attract funding as we do not offer to serve a big number of homes with a single project.”

The situation is by no means new and it’s already widely known that BDUK’s Framework has only named two operators, BT and Fujitsu UK, to deliver the relevant services. In addition Fujitsu appears to have withdrawn from most of the related contracts and thus BT is expected to dominate the process.

Unsurprisingly BDUK’s framework is often perceived to have set the economic bar too high for smaller ISPs (altnets) to get involved, which has resulted in many of the original bidders (e.g. GEO, Vtesse, Cable & Wireless etc.) choosing to leave the process (example). During July 2012 the Independent Networks Cooperative Association (INCA) moved to tackle this problem by forming a consortium of smaller ISPs to challenge the big boys, although so far no further updates have been released.

It had been hoped that the European Commission (EC) would put pressure on the UK government to make its BDUK funding more accessible to smaller providers. Sadly no significant changes were noted in the EC’s recent funding approvals. Some hope is still being held for a future post-2015 strategy, which might deliver the needed changes, yet many smaller ISPs remain deeply pessimistic.

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35 Responses
  1. Avatar dragoneast says:

    As always the public sector can’t win: if it gives money to the incumbent which already has a national network, it’s wrong; if it gives money to newish and enterprising entrants who can deliver now but are vulnerable to economic pressures and may not be able to modernise their networks in the future, that would be wrong; they should force firms to enter the competition; and if the money runs out before the job is done it’s definitely wrong. And nationalise the lot. And it’s a moving target. (Sorry if I’ve left anything out; and a Happy New Year).

    But is BDUK really doing so badly with the hand it’s been dealt?

  2. Avatar New_Londoner says:

    Quote ” Sadly the ISPs requests for support from the government’s Broadband Delivery UK (BDUK) office have so far been rejected.”

    Perhaps it should have bid when the BDUK tender was held! And if it couldn’t meet the tender requirements? Well that’s how tenders work – the customer sets the terms, it’s up to any prospective bidders to meet them, not, the other way round.

    1. Avatar Chris Conder says:

      The tenders were written specifically to exclude smaller companies. One has to ask why it was so, and possibly check out ‘vital vision’. google it.

    2. Avatar TheFacts says:

      Look up what happened in Selling and the NextGenUs saga.

      This is not say that smaller companies cannot provide a service but when receiving public money there need to be checks in place about ability to provide and long term support.

    3. Avatar Chris Conder says:

      Sorry, don’t know the facts about Selling, but as far as I know Nexgenus didn’t have any funding. Perhaps with support the altnets could achieve far more than the incumbent, who is just patching up a few cabinets as a short term solution which is all that seems to be happening with our tax payers money so far?

    4. Avatar Somerset says:

      I take it that the word ‘incumbent’ means BT. How is rolling out FTTC to 66% and more of the population ‘patching up cabinets’? No one else sees it as a short term solution because it also makes available FOD for those that want or need it.

      In Selling the parish council selected and paid a supplier who could not deliver. It’s well documented elsewhere.

  3. Avatar Anoyed tax payer says:

    Having looked at their website, I can see why they are struggling for money. If someone came to me looking for funding and they had that website, I too would tell them to bogoff.

    1. Avatar Chris Conder says:

      The website in question answers all my questions in a very clear way. It may not have expensive bells and whistles like other sites but it fulfils its purpose.
      Try to find the same information on a major telco site and you could be there for hours. Within 5 minutes I found out everything I needed to know to get a connection if I lived in the area.

    2. Avatar Anoyed tax payer says:

      I was talking from an investment point of view and not as a customer. For a start off the website has used a template taken from another company (That’s not a good start).

      The website looks very amateur and to an investor it would not sell.

    3. Avatar Tom says:

      The website is so unappealing and doesn’t present the information well. Kijoma has a more appealing website and that site isn’t very good.

    4. Avatar Somerset says:

      http://companycheck.co.uk/company/04651319

      Taken from the 2011 accounts:

      Cash at Bank: £2,857
      Net Worth: £-14,734
      Total Current Liabilities: £33,503
      Total Current Assets: £4,937

    5. Avatar FibreFred says:

      That says it all Somerset!

      If they were profitable they wouldn’t need any funding surely? Sounds like they are after public funding just to keep their heads above water.

      For that reason.. I’m out.

  4. Avatar PhilT says:

    The ERDF projects have more flexibility than county-wide BDUK schemes, I think there’s another round in January http://www.gov.uk/applying-for-erdf-funding

  5. Avatar dragoneast says:

    I suspect the real decision is that of the customers. Whatever our personal preferences and theories, I suspect the vast majority of customers faced with a choice of equal services between a national network operator such as BT and Virgin and an altnet will always prefer the supplier they know, especially when they are price competitive – it’s the supermarket argument (and it’s rational and sensible human behaviour). So the alternatives have to find their niche in a changing world, but the limited subsidy available will go to the successful who can place themselves in the right place at the right time, not to those who are floundering and/or moaning – and as a taxpayer I say that’s right. Didn’t we learn anything from the 1970s – subsidies do not save a floundering or deserving business, small or large. As a customer I find any moaning business most unappealing (and my suspicions seem to be so often confirmed as events turn out). Am I the only one?

    I am a (maverick) customer of a WISP who is both expanding and benefiting from public subsidies – so appears to count as successful; but continuing success isn’t guaranteed. It’s the customers who pay the bills, who will decide. Even then (as if to prove my point) I now have an FTTC fixed line connection as soon as it came to my cab.

    1. “As a customer I find any moaning business most unappealing”

      So presumably, you find both BT and Virgin most unappealing, given that they seem to be throwing their toys out of the pram over the potential subsidy for ultrafast in the West Midlands going elsewhere?

  6. Avatar Chris Conder says:

    If BT were that efficient Fibrefred then why do they need all the funding? And we obviously didn’t learn anything from the 70s if we continue to pour subsidies into the coffers of an incumbent to shore up obsolete assets dragoneast? I don’t think the WISPs are moaning, they are just raising awareness of this issue. The customer will use whatever is easiest. The millions the incumbents pour into marketing make out their service is the best, so customers believe it. As far as FTTC goes, those close to cabs will have an adequate service for now. Don’t blame them at all for signing up if that is what they want. But it isn’t the future, and it isn’t where funding should be directed. Altnets concentrating on areas the incumbents aren’t interested in is where funding was intended to serve, and that is where it should go. Europe has missed a trick. We are faced with another decade of no competition and ‘open access from ISPs as long as they buy from BT monopoly’ the only choice.

    1. Avatar FibreFred says:

      Isn’t that already clear via BDUK? Its for areas that are not commercially viable. If Countryside Broadband is trying to bring services to areas that are not commercially viable and they are a small ISP the question has to be why? Why rollout where there is no money to be made?

      This ISP IS moaning, Somersets post shows they are pretty much broke

    2. Avatar dragoneast says:

      I’m not following your argument Chris. Why is FTTC an “obsolete asset” when FTTC customers will have the option to pay for an upgrade to FTTP if they want it later this year? Why must I have FTTP when FTTC at 40Mbps meets a multiple of my needs now and for the foreseeable future – what can you do (or even expect to do) on your fibre connection that I can’t do on mine that is so compellingly necessary, and remember there’s only one of me which isn’t unusual? (But please don’t patronise me with some fairytale future which might happen, or not (as the case may be), after I’m dead!). Why is it necessary for me living on a pension to eat less or sit in a cold dwelling so I can afford FTTP – I suppose I can keep myself warm with the anger. I have friends who live in the country who are pleased with what they can do on a sub 2Meg connection (the sort of connection on which I’ve both worked from home and conducted all my personal business over the internet) and who think I’m barmy when I find it a “problem” when I visit them. I know there are people both equally in towns as in rural areas who suffer, and I do not begrudge them public infrastructure subsidy, but overcooking the books does not do them any favours, in my humble opinion.

    3. Avatar FibreFred says:

      Exactly Dragoneast

      I’m struggling to get best use out of my 80/20 FTTC set-up and we have iPlayer on various devices, iPods, Android devices, Laptops and an Xbox 360 and Wii

      But should the time come in the future when my connection isn’t enough (way off I should imagine) I can upgrade to FTTP , so… obsolete? Nope, not at all

    4. Avatar Somerset says:

      Learn what from the ’70s? BT, and the internet, didn’t exist then.

      Please explain the ‘efficiency’ issue.

    5. “Its for areas that are not commercially viable.”

      Hmm… now let me see… who was it that determined this? Oh yes, BT knowing full well that BDUK et al would open up their cheque books! 🙂

    6. Avatar FibreFred says:

      Not really wirelesspacman no, any ISP, small alnets or Virgin. Otherwise they’d already be serving that area?

  7. Avatar Gadget says:

    Chris – best wishes for 2013 to you and all your B4RN colleagues,

    Whilst not wishing to put words in others mouths …..
    1) The reason funding is required is that no-one, not BT nor the altnets can make a commercial case for deploying, its not about BT not being efficient or even able to employ economies of scale.
    2) BT like any other is responding to the requirements of the tender – if it can be achieved using FTTC/FTTP mixture keeping the cost down from a full-fibre solution that saves the public purse. I have not seen any tender requirement to have 100% FTTP.
    3) The funding IS going to areas not currently served, so I can’t see why you think it must be an Altnet that should be doing the serving, unless of course they were proposing a “bid-winning” solution.
    4) Assuming you consider FTTC to be obsolete from your comments then I’m a little confused why you would not also consider a WISP offering 10Mbps on a presumably shared bandwidth to be in the same category, and also “not the future and where funding should be directed”?

    1. “The funding IS going to areas not currently served”

      But “not currently served” is VERY different to “not commercially viable”. During the adsl roll out days, BT moaned and moaned that lots of exchange areas were not commercially viable. The reality was of course that they were just staggering their roll out whilst demand grew. A few years later, just about every exchange had been enabled, regardless of whether or not BT was given a public purse bung for doing so.

  8. Avatar FibreFred says:

    “The reality was of course that they were just staggering their roll out whilst demand grew.”

    🙂 Growth in demand CAN make an exchange commercially viable! Plus a decrease in costs for kit over the years

  9. Avatar DTMark says:

    Having watched the BDUK farce unfold, our village (2.5km from the exchange, ADSL speeds in range from 0.5Meg to 7Meg, average about 2.5Meg) identified broadband speeds as a “serious problem” for two thirds of the population, with less than 20% saying that services meet their *current* needs.

    The two old phone cabinets are too far from some of the properties to deliver anything much at all. So options for the area are WiFi or FTTP. Both can deliver current-gen services and a mesh Wi-Fi network should be able to deliver 30Meg to everyone (actually there is just one house it may not reach).

    Next week I have to write up a summary document so as to survey our village again to determine how the money we have should be spent (skateboard park, pond, subsidised shop, broadband network, etc) and should the village determine the broadband one important enough then we need to select a provider. We’re already in contact with several.

    All without BDUK, indeed BDUK emphatically rules out the most sensible tech option of Wi-Fi (only current-gen) but rules in the FTTC option (still only current-gen) which won’t actually reach everyone anyway or result in higher average speeds, indeed probably a little lower than WiFi (estimate about 23Meg FTTC average versus closer to 30Meg WiFi average).

    Which leaves us looking at the funding available for rurals outside BDUK. It’s as if this BDUK thing never really happened. Our taxes go to paying for, say, BT to patch up the phone network in areas which are alreadfy current-gen anyway (like cabled areas) but potentially deliver us either something weak and substandard (FTTC) or nothing at all.

    1. Avatar New_Londoner says:

      @DTMark
      Quote “Our taxes go to paying for, say, BT to patch up the phone network in areas which are alreadfy current-gen anyway (like cabled areas) but potentially deliver us either something weak and substandard (FTTC) or nothing at all”

      Not correct to say BDUK money goes to cabled areas, i think you may be confusing BDUK- and BT-funded investments. Remember BDUK money is to cover the so-called final third, or at leat a good chunk of it, with BT funding the remaining two-thirds and Virgin covering just under 50%.

      If some properties won’t gain from FZtTC, why do you say the whole area needs FTTP? Why not have a mix, which would be far more cost-effective, should leave more money for other priorities.

    2. Avatar Somerset says:

      Still comments continue with silly language. ‘Old’ phone cabinets, ‘patch up phone network’, ‘substandard FTTC’. Does not sound like a professional evaluation of the situation. Another Selling in the making?

    3. Avatar FibreFred says:

      Well I’m more than happy with my patched up phone network FTTC connection, despite the only bit of the “old phone connection” being the 500m or so of copper from my house to the cabinet

    4. Avatar DTMark says:

      Might be wrong about the areas which are cabled already; are we saying that no BDUK money goes where there is already a current-gen offering (say, WiFi, Virgin cable) or a next-gen offering (e.g. Gigaclear, Hyperoptic)

      I’m not saying that the entire village needs FTTP. What I am saying is that if the village doesn’t benefit from any of the socialised funding, and we have to pay for it ourselves, then we want the best coverage and speeds, not least because so many have identified what we have as a “serious problem”.

      The phone network is so very old and knackered that the quality of the D-sides concerns me greatly. Most of the line stats are atrocious. Who knows whether it’s the D or E sides which result in all those high noise figures? Nobody, probably. It doesn’t bode well for VDSL. It might be great, it might be nearly useless.

      It would not seem sensible or logical to pay BT to pay to “enable” two cabinets that not everybody can even get a service from if an alternative exists which would service most with better speeds.

      If I add on the “FTTP on demand” costs for all the properties that can’t get the modern service we want to the above, I’ll bet the cost isn’t too far off a true FTTP network. But, I can’t price that accurately as nobody including BT knows how many would need to pay for that until the money’s all gone.

      I think two extra cabs would enable good coverage, but the cost of enabling 4 cabs for 240 homes is likely to rule that out when put side by side with other options. You’d end up with two brand new pairs of cabs servicing maybe 25 lines each. That’s a huge cost per property. Wi-Fi looks very attractive. As you say a mix would be possible.

      The BT proposition is not to guarantee anything in particular to anyone and while it’s mentioned in the documentation and on the community planning website, I can’t seriously push such an option “you may or may not get something unquantifiable if we spend your money for you, and you might then have to pay out another grand or two yourself” as a viable one though I do intend to present this as a possible option in a comparison table, it is far from entirely my decision.

      Of course, if we do indeed get our own broadband network paid for by the village, then the village becomes commercially viable for BT FTTC and so there’s a chance we’d get that for free leaving people with infra choice which should be borne in mind.

      I am not aware that an inclusive, tehnology neutral (“the right tech for the service goal” or “blue sky thinking”) BT based proposition exists… perhaps it does. The basic aim is very simple and highly achievable: everyone can get a 30Meg (down, throughput) service for the overwhelming majority of the time. BT’s FTTC proposition only seems to be viable if you include the magic words “up to”.

    5. Avatar DTMark says:

      @Somerset – funny you should mention Selling village, which failed for a number of reasons one of which appeared to be a desire to drive something next-gen (very creditable) without considering commerciality.

      This is one of the reasons why I cite the Selling case study in our meetings and the importance of costs and viability, the importance of surveying the entire population, establishing demand and price levels and so on. Those were/are the questions posed by the village broadband survey.

  10. Avatar fastman says:

    dtmark — are you in an enabled exchnage and if so have you considered checking whether FTTC would work in your village — is the cabn actually in the village or outside it

    1. Avatar DTMark says:

      The exchange only has ADSL2+ and is not in the rollout plans. But then it only serves about 1200 premises.

      There are two cabs both right on the very edges of the village e.g. in the worst possible locations they could possibly be as far away from the most properties that they could be.

      It’s very easy to work out the line lengths for almost all the lines since they really do only take one route and don’t “go round the houses”.

      And so it’s also easy to work out the lengths of all the D-sides. What’s not possible with any reliability is to calculate likely performance given the ancient nature of the lines, mixed metals, line repair boxes, and so on. FTTC is essentially more of an experiment than an exact science in the real world.

      What is possible, perhaps likely is that there aren’t enough D-sides anyway given some of the poles have DACS boxes on them though I imagine that might be dealt with. What won’t be dealt with, sadly, is the poor quality of so many lines. Unless they’re replaced, of course. And it would seem pointless to replace them with copper ones/new sections when you could just put in fibre instead.

      So returning to the article, actually, as I see it, FTTP – apart from being what the village wants – does potentially open up BDUK money so even though it’s very much more expensive than Wi-Fi, it might be worth pursuing if that opens up funding for something truly next-gen that will endure.

  11. Avatar fastman says:

    i assume you speaking to your county around whether it will sit in their intervention area assumeing they have done their OMR Open Markjet Review

    1. Avatar DTMark says:

      We are indeed.

      Hampshire is about 80% rural by geography but 80% urban by population. Which is to say most live in towns.

      Many if not most of the towns are cabled, so if it’s right that no BDUK money can or will go into say Southampton, Liss, Aldershot or Portsmouth (all cabled I think) other than filling in some not-spots where cable doesn’t go, then that leaves money for the rurals which is what made me question that aspect.

      But whether the pot of cash Hampshire has is enough to roll out NGA fibre or even FTTC to the rurals (e.g. the clustered villages where FTTC would be a suitable option) bearing in mind how much of it would be needed is another matter, their hands appear to be tied because BDUK won’t allow them to spend it on Wi-Fi.

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