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Oxfordshire County Council Rejects Cotswolds Broadband Scheme for BT

Wednesday, November 13th, 2013 (8:35 am) - Score 1,192

The promising Cotswolds Broadband project, which aimed to roll-out an open access and 100Mbps capable Fibre-to-the-Premises (FTTP) network to 90% of homes and businesses (5000 premises) in the Chipping Norton area of west Oxfordshire (England), has joined a similar project in Dorset (Trailways) to be rejected by local councils in favour of BT.

The scheme had been seeking funding through the £20m Rural Community Broadband Fund (RCBF), which has unfortunately been stalled for several months because BT and many local authorities have refused to release vital postcode-based broadband speed and coverage (SCT) data due to it being deemed “commercially sensitive” (here). The information is required in order to ensure that related projects do not overbuild those that are set to be delivered under the Government’s £1.2bn Broadband Delivery UK (BDUK) programme because doing so would breach state-aid rules.

At the same time many smaller ISPs (altnets) and critics of the project have raised concerns over the way that BT are currently the only viable bidder under BDUK’s framework, which has allowed them to gobble up all of the available contracts. Meanwhile smaller ISPs are unable to bid due to a high turnover requirement and bigger providers withdrew over competition and economic concerns, such as the way that BT would not allow their cable ducts (Physical Infrastructure Access) to be used for business as well as residential provision.

The Government’s culture secretary, Maria Miller, had initially appeared keen to see smaller rival projects “co-exist happily alongside the wider rural broadband [BDUK] scheme” but the practical reality is that this has not happened and many councils that signed contracts with BT are now rejecting some once very promising alternatives.

Hugo Pickering, CEO of Cotswolds Broadband, said (BBC):

Oxfordshire County Council has supported this all along but has now decided it is not going to separate it from their contracted plans with BT. We have already put in a whole lot of money and so the council may receive a compensation claim.”

It’s believed that many tens of millions of pounds, which include public as well as private investment, are currently caught up in the on-going RCBF debacle. For example, the Cotswolds Broadband scheme informs ISPreview.co.uk that they alone bid a little under £1.8m (i.e. just under 6,000 premises – around £300 per property) to the RCBF and were working towards raising several million more (here) through various other sources.

Related projects often aim to deploy true fibre optic (FTTP/H) services that would have gone beyond BT’s dominant but slower FTTC solution, although whether or not they could have provided the same familiar selection of mass market ISPs is another matter.

A BT Spokesperson said:

It is up to the local council to decide who they work with on rural broadband. Having said that, a key consideration is that any network which benefits should be open to all ISPs to use. That way, local monopolies are avoided and customers have choice.

BT has spent huge sums developing systems that support such competition and it may be the case that small local operators can’t meet those conditions and are therefore ineligible to receive public funds.”

In fairness BT are a commercial company and thus you can’t blame them for protecting their own interests. Similarly they are one of the few operators with a truly national network and enough financial clout to actually stand a chance of achieving the Government’s 95% target for fixed line superfast broadband coverage by 2017, especially with only £1.2bn of public funds to play with (a drop in the ocean for this kind of work).

On the other hand it can often seem senseless to reject viable alternatives, many of which have put years and years of effort into reaching the current point and might even be able to deliver a more capable service going forward. Ultimately the responsibility for such situations must fall upon the Government and the way that Ofcom chooses to regulate the market, which has created the current situation.

In addition the uncertainty created by the government’s additional allocation of £250 million for use post-2015 has, despite being a useful boost, so far only added to the current RCBF problems and confusion over BT’s FTTC/P coverage in the last 2-10% of rural areas (note: BT’s actual coverage commitments under BDUK varies between the regions).

We expect that many more altnet projects will suffer from similar problems. The schemes that stand the best chance of surviving this are perhaps those that have already got their cable in the ground through private investment, assuming the government doesn’t find an anti-competitive way for BT to overbuild them via public funds.

It’s important to stress that Cotswolds Broadband said it was “still in the game” and hadn’t given up on their project.

Leave a Comment
8 Responses
  1. This is depressing. Smart innovators with entrepreneurial spirit and the capability to deliver the superior service that people actually need must be saying to themselves “why do we bother?”.

    Are we really ok with such mediocrity? Is there really no vision other than what is given to us by big business. Have we lost the spark?

    The next generation has already been saddled by huge debts arising from this generation’s mis-management of the economy. New technology could offer them an opportunity – a way to get ahead of our competitors.

    Government (local and central) needs to grow a pair before it’s too late.

  2. New_Londoner says:

    Is this the scheme that was running a crowd funding site, had only raised a tiny % of its target? Or am I confusing this with another project?

    The assumptions seems to be that these schemes are good, but is anyone looking at the value for money aspects, including how much invetsment is being injected by the backers as opposed to the public purse? Some appear to need close to 100% public funding.

    1. TheFacts says:

      The document for this scheme was big on tax saving but near zero detail on scope and solution.

    2. FTTP says:

      @TheFacts, all of the RCBF bids by definition have to be quite low-detail in their initial expression of interest and following bid. They have to be technology neutral in their entirety throughout the whole process, for one thing.

      Having seen their document I’d agree even given this it’s a bit vague and nebulous but the thing that killed it (because let’s face it, most tender docs in government schemes are vague and nebulous) is the fact that BT sliced their coverage area up into a multitude of disconnected islands, taking all of the vaguely interesting bits and leaving them with tiny, unaffordable islands to connect and no way for them to efficiently do backhaul between them. BT killed this project, and Oxfordshire County Council let them.

    3. TheFacts says:

      It’s been clear for years that FTTC leaves disconnected spaces with it serving properties that would benefit.

      BT FTTC didn’t kill this project, it should have realised that FTTC would come along to most cabinets as a relatively quick solution to cover a large area.

    4. gerarda says:

      How much percentage funding would BT have needed if the BDUK requirement was for a 100% superfast service?

      The two tier nature of the current requirement is simply resulting in deepening the digital divide between those within reach of an FTTC cabinet and those without. Today I got a mailshot from Talk Talk offering me a service that required a minimum of 5mbs – some 40 times faster than the average speed available in our FTTC “passed” village

  3. MikeW says:

    As @TheFacts points out, FTTC is grabbing the low-hanging fruit – by offering an economical way to target 90%+ of consumers, and doing it in a way that offers what people need now at a price they’re willing to pay.

    The problem is that this coverage comes from two different sources:
    – Commercial coverage, where a company can get by with an internal unpublished strategy, and alter it as it sees fit
    – A state-aid subsidised rollout to cover everyone else, which requires a shared strategy

    The government put the onus on the counties (or groups of councils) to manage this shared strategy, and some have made a better fist of it than others. But the simple fact is that once BDUK projects came along, it is their mere existence that killed off RCBF projects of the format they used to be.

    An RCBF project to cover Chipping Norton was never going to get the go-ahead, because a BDUK project would cover the easy portion (the low-hanging fruit). Which means that RCBF projects need to re-target themselves to be the areas that FTTC cannot go.

    However, we’re still working out where FTTC can go, and the government have just given the BDUK projects an extra 2 years to consider it, which brings vectoring into the equation along with the extra range it brings to the table.

    I guess we need to accept that a post-BDUK RCBF project will only come about when the county councils are back in charge of the strategy. It’ll take some time.

    BTW – the coverage maps for North Yorkshire are now looking pretty detailed to me. They might not be at the postcode level, but they certainly look to be at cabinet-level, and certainly make it obvious which villages miss out. I would have thought they’d be enough to base RCBF funding on. SFNY has been going for 16 months, so perhaps we simply aren’t giving the other counties enough time as yet.

  4. Hugo Pickering says:

    A few issues to correct here. Firstly, Cotswolds Broadband’s crowdfunding was alongside a larger fundraise which was itself dependent on securing an RCBF contribution. Investors were ready to invest and local people had already invested a six-figure sum (and pledged further investments) on the back of support from the county council and BDUK to put forward a full application for the RCBF funding. As that grant money has not materialised the business plan as submitted to BDUK does not stack up.

    I’m afraid @MikeW is incorrect in assuming that Chipping Norton was within the project footprint, since the project was specifically to benefit premises within the rural ‘final 10%’ around the town, particularly in view of its origins as a Transition Towns project to ensure the economic stability and sustainability of Chipping Norton.

    @FTTP is correct in that the Oxfordshire county broadband mapping shows a patchwork quilt across the county but it is clear when overlaid with cabinet and premises data that BT have specifically targeted the Cotswolds Broadband project footprint for far greater FTTC coverage than anywhere else in the county, even claiming that only 96 premises will remain unserved by the BT contract in the area. What are the odds on that happening?!

    Thankfully there are more creative and forward-looking local bodies who are keen to look at models other than simple match-funded grants, that can make a return for public money being used to benefit the populace. So the project isn’t dead.

    One final correction to the original article is that I never said that ‘the council is going to be liable for a compensation claim’. That was something the BBC construed from a comment about possible compensation for investors. You will see that they have changed the quote on the BBC website since. A classic case of don’t believe everything you read in the media!

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