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Government Moot BDUK Fibre Broadband Plan for South Yorkshire UK

Monday, January 13th, 2014 (8:03 am) - Score 1,994

The Government has proposed a new £10 million scheme, which would be based off its existing Broadband Delivery UK (BDUK) programme, to help deploy superfast broadband services across 90% of South Yorkshire in England (most likely with BT’s help). The region suffered a £155m failure last year when the alternative Digital Region network collapsed.

The Digital Region project initially began life in 2008 with around £100m of public money and the aim of building an alternative network that could roll-out superfast broadband (FTTC) services to 80% of South Yorkshire (the longer term ambition was also to reach 97%), primarily because BT had shown little interest in doing so.

However, despite reaching its 80% target in 2011, a toxic cocktail of poor advertising, zero support from the big ISPs (some didn’t want to step on BT’s tail), competition from BT’s own services and the resulting lack of customers (at the last count it had 3,000 subscribers but needed 108,000 to be self-sufficient) meant that the network was burning masses of public money (roughly £1m per month + a £25m EU grant that needed to be repaid).

As a result there were few surprises when in August 2013 and following a failed proposal to rescue the network via a new owner and yet more public money, Digital Region formally announced its plans to close the network (here). At the time it was said that closure of the network would save the taxpayer an estimated £12.5 million.

The situation meant that some parts of South Yorkshire would once again be left without superfast broadband connectivity. But a new report from the Department for Culture, Media and Sport (DCMS) today has elaborated on what went wrong and also proposed a new £10m BDUK scheme to improve local connectivity.

A DCMS Spokesman said (Yorkshire Post):

BDUK is ready to discuss how to take forward a project to deliver 90 per cent superfast coverage in South Yorkshire with the four local authorities involved. BDUK has earmarked (£5m) funding for a South Yorkshire project – as for the rest of the country, we would expect that BDUK would provide 50 per cent of the necessary public funding and that local funding – including the option of European funding sources – would provide the other 50 per cent.”

The Government’s proposal would mirror the BDUK scheme in other areas and since BT is currently the only approved operator able to bid then it’s a fair bet that they’d take on the task of deployment via the usual FTTC/P technologies. Curiously the DCMS statement makes no mention of private sector funding, although BT would normally be expected to put in some of its own investment in order to match-fund with the local authorities (Sheffield, Rotherham, Doncaster and Barnsley).

But a deal is by no means done. The four South Yorkshire authorities are still attempting to find a buyer for what’s left of the Digital Region network (i.e. nobody likes to spend £155m only to scrap what’s left) and have linked that to any future plans, which means that the issue must be resolved before a deal can be agreed.

It’s also possible that BT might have some interest in certain aspects of DRL’s remaining network, which could save them time on any future deployment in the area, but that’s just speculation on our part. GEO Networks has reportedly shown a similar interest.

Meanwhile Digital Region’s remaining customers (i.e. those who haven’t already migrated away) can expect to be contacted again within the next few weeks with news of the final closure plans.

UPDATE 10:15am

Added an extra bit of info. to note that GEO Network’s has also been sniffing around DRL and look more likely to grab it than BT, which doesn’t strictly need DRL’s infrastructure to make the new BDUK proposal work.

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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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19 Responses
  1. Avatar SpencerUk says:

    We all know that when the network closes, BT will most likely pick up for a nominal fee so a little BDUK funding will go to places where there is no BT FTTC or Digital Region presence. Makes sense.

    The article doesn’t mention that Geo Networks were rumoured to be looking into taking the network over. http://www.itproportal.com/2013/12/23/geo-networks-talks-acquire-digital-region-assets/

    1. Mark Jackson Mark Jackson says:

      I wasn’t aware of the GEO link, thanks Spencer. Probably because the news came out just before Xmas Eve.

  2. Avatar Barrie Thomas says:

    As a DR customer with no alternative (BT/OpenReach have steadfastly refused to install fibre to my local central Sheffield exchange) this does sound like I have some hope from the future. To use BDUK finding to buy up the already installed fibre and incorporate it into their current network seems to offer a fast turnaround resulting in greater capacity and more customers for minimal outlay. I’d say that was a win-win scenario for all concerned.

    Of course it would be nice if there was another player (Geo Networks) to put pressure on the BT monopoly so that we weren’t just a captive audience.

    1. Avatar sheffieldowl says:

      I’m in the same boat too Barrie Thomas.I feed off the Attercliffe exchange and other than DR fibre there is nothing else available and BT have no immediate plans to upgrade the exchange.So without DR fibre I would be back to sub 2mb ADSL download speeds.

  3. Avatar Stuart Grimshaw says:

    What are BDUK going to do different to DRL that they think £10m will make them successful?

    1. Mark Jackson Mark Jackson says:

      Give the money to BT most probably, which already has most of what it needs (including customers) in place and thus wouldn’t have to build from scratch.

    2. Avatar CrazyLazy says:

      Shock horror BT inheriting a network… Surely not, oh hang on i forgot history for a moment.

  4. It would be a major missed opportunity if all the vision, work and effort which went into Digital Region simply ended up getting sucked into the BT network. If taxpayers’ money is going to have to be invested here, it should be used deliberately as seedcorn funding to engage third-party providers (or consortia) to demonstrate a real competitive alternative, at scale, to the BT monopoly.

    1. Avatar SpencerUk says:

      My understanding of the breakdown in numerous take over talks with private companies is the debt the Digital Region project carries. The councils are very eager to pass the debts on as well as the government themselves.

      I think the reality is that BT will take this on for a nominal fee and the debts will have to be paid for by the councils…somehow.

    2. Avatar DTMark says:

      BT can either be essentially a State utility company or a private company. It cannot be both, a “hybrid” as it is now.

    3. Avatar Ignitionnet says:

      I suspect there will be some resistance to that after the amount of taxpayers’ money that disappeared into the ether on Digital Region. Understandably so.

    4. Avatar MikeW says:

      Vision, work and effort are all meaningless if the vision misses some crucial aspect, and results in an unviable product offering. Whatever got missed – whether it is marketing effort, or the wrong wholesale partnerships, or something else – was a crucial component, and it seems pointless lauding the vision when it all went so wrong.

      The debt here is almost certainly the reason that BDUK has taken the form it has – gap funding with all risk left firmly on BT’s shoulders.

      Anyone who either takes on a BDUK role for the region, or takes over DRL, will probably need to work in the same way – taking on all the risk. I can only see that happening if they have a wholesale offering that can attract the likes of Sky and Talk Talk, and even BT Wholesale .

    5. Avatar JNeuhoff says:

      The very fact that £1.2 Billion of taxpayers money has been wasted so far on dubious BDUK schemes to enrich BT shareholders clearly illustrates that VDSL is not a commercially viable technology for a vast portion of the UK, most towns with less than 10 000 cannot be commercially served by BT with this technology, because it is the wrong design for small places and vast rural areas.

      Chris Pateman’s thoughts on seedcorn funding are certainly worth a consideration. At the moment, the UK telecoms sector has a severe lack of innovation.

  5. Avatar Moo says:

    I hope sort out the issue of Exchange Only lines. I can’t get FTTC as my line is a exchange only.

    1. Avatar JNeuhoff says:

      The issues with so-called EO lines is something unique to the UK, and is a sympton of using the wrong technology.

      Lets hope that after the debacle of DR no more taxpayer’s money is wasted on other dodgy schemes like the BDUK.

    2. Avatar FibreFred says:

      Same old same old JNeuhoff, you say its the wrong tech I say what’s the right tech, you say FTTP, I say how is that paid for and you say….. nothing.

      EO lines have a solution a putting in cabinets , but I don’t expect they’ll tackle EO lines until the rest of the rollout is complete

    3. Avatar GNewton says:

      “The issues with so-called EO lines is something unique to the UK”

      EO lines may exist in other countries, too, so no, it’s not unique to the UK.

      However, the belief that only cabinets can save the day for EO lines just shows how ignorant people can be, or perhaps how they have been brainwashed by BT into believing these fairytales.

      Also, it is a common misbelief amongst many that there is no money for fibre broadband (I am not talking about VDSL, but rather, fibre lines, not everyone has fallen victim to the ASA lies!). For a starter, I recommend http://www.theguardian.com/commentisfree/2013/may/20/high-speed-broadband-not-hs2 . Or think about the costly bailout of failing banks a few years ago, the NAO puts the cost of Britain’s bank bailout at £141bn, as at March 2013. Fibre broadband is a small fraction by comparison.

    4. Avatar Gadget says:

      The various sources mentioned such as HS2, or Bank bailout whilst numerically sufficient have the fatal flaw that the money is currently destined for those projects or already spent and NOT fibre rollout. We can discuss if it should have been spent on fibre but at this time there is no credible source of money available.

    5. Avatar FibreFred says:

      “However, the belief that only cabinets can save the day for EO lines just shows how ignorant people can be”

      Aimed at me no doubt. I’m not ignorant. That is (in terms of what we have heard to date) BT’s choice, re-arrangement of the network i.e. putting in cab’s. Its not the only option no not at all. FTTP is of course but how is that paid for , as for saying.. oh there’s money lets can HS2.

      Is HS2 being canned in favour of putting the funding into FTTP?

      If not…. its not even worth raising, you can tell everyone that until the cows come home it doesn’t make it reality.

      The reality is that the government are spending that money on HS2 if they weren’t I doubt they’d be spending it on broadband as they seem quite happy with how its going at the moment (BDUK farce aside) and probably don’t give two figs about EO lines themselves which whilst a sizeable minority are a minority all the same

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