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BT Sign £146m Deal to Rollout FTTC Broadband in the Highlands and Islands

Tuesday, Mar 26th, 2013 (8:08 am) - Score 938

It’s been a long time coming but Scotland’s Highlands and Islands Enterprise (HIE) has finally signed its “most ambitious” contract worth £146 million with BT, which will make superfast broadband (FTTC/P) ISP services available to 84% of premises in the Highlands and Islands by the end of 2016.

The deal, which was finally signed in Inverness today, has been beset by problems due to the often complex technological and economic realities of attempting to expand the reach of a modern telecoms infrastructure over some of the United Kingdom’s most rural and rugged terrain.

On top of that BT has been left as the only major bidder for the project since November 2011, when it first emerged that Cable & Wireless (C&W), Fujitsu UK and Commendium had all given up on the tender process citing a lack of public money and other economic concerns (here).

As a result it’s of little surprise to find that BT has not been able to match the public investment. The Scottish Government will put the lion’s share of state aid into the deal at £126.4 million and BT will be asked to cough-up just a smidgen at £19.4 million.

Bill Murphy, BT’s MD of Next Generation Broadband, said:

There are incredible obstacles to overcome, not least building a fibre network across some of the most rugged terrain in the UK. And we have huge distances to cover as we lay our cables over the hills and glens and under the sea. The unprecedented scale of this project is such that it can only be done in partnership and all of us in BT are looking forward to continuing the great working relationship that we’ve built up over many years with Highlands and Islands Enterprise.

BT’s network will be open to all communications providers on an equal wholesale basis creating a competitive market where people aren’t stuck with one broadband provider and can choose the package and price that suits them.”

It’s worth noting that at least some of that public funding comes from the Broadband Delivery UK (BDUK) office, which has already allocated £100.8 million to Scotland for better broadband provision, and up to around £25.5 million will also come from Europe (here). In addition the HIE itself has also put £12m into today’s deal.

A special £2.5 million Innovation Fund will also be setup in order to assess emerging technology solutions for connecting the most remote areas in the final 16% of the Highlands and Islands region.

Nicola Sturgeon, Deputy First Minister, said:

Our decision to invest over £126 million in this project demonstrates the confidence that we have in the economic future of the Highlands and Islands. Today’s announcement signals the start of one of the most ambitious infrastructure projects in Scotland’s history. It will connect communities across some of the most challenging landscapes in Europe and provides a platform for future economic development and regeneration.

Next generation broadband enables businesses to compete on the international stage. It has the potential to transform the way in which we educate our children, provide health and social care and deliver our public services

We congratulate Highlands and Islands Enterprise, BDUK and BT on the work that they have done to agree this contract and The Scottish Government will continue to work in partnership with them and local authorities across the region, to deliver real benefits to local people and businesses.”

As part of the effort BT will need to roll-out 800km of new fibre optic cable on land in order to connect hundreds of new street cabinets. In addition another 400km of subsea fibre cables over 19 crossings will need to be installed in order to connect Scotland’s many remote island communities. BT claims that this scheme is the biggest it’s ever undertaken.

BT’s roll-out will naturally be dominated by its up to 80Mbps capable FTTC and 330Mbps FTTP technologies. The roll-out itself will begin in 2013 and complete by the end of 2016, although a clear timetable is not expected to be agreed until after BT has completed its initial survey work.

At present Scotland’s overall objective is still to make superfast broadband (40-80Mbps) speeds available to 85-90% of premises by 2015 and “world-class digital access” for all of Scotland by 2020.

The HIE and BT project covers all seven local authority areas in the Highlands and Islands – Argyll and Bute, Eilean Siar, Highland, Moray, part of North Ayrshire (Arran and the Cumbraes), Orkney and Shetland.

UPDATE 8:19am

Added some extra timetable details from BT and HIE.

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 X (Twitter), Mastodon, Facebook and .
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