BT’s Struggle to Upgrade Broadband in Costly Deep Rural Parts of the UK

Competition concerns with the Broadband Delivery UK project have again been raised after BT’s Programme Manager for the £94m Connecting Devon and Somerset scheme in England, Laurent Boon, rejected a call for the parish of Upottery to receive a “fibre broadband” upgrade, which it said would cost the equivalent of £2,000 per property.

Cost remains the key reason why the UK Government hasn’t yet been able to commit to a target of delivering superfast broadband (25Mbps+) speeds across 100% of the country (95% by 2017 is the current goal), although the EU has set a general target of 30Mbps for all by 2020.

Like it or not that last 5%, which most typically represents sparse populations, are very expensive to serve and this is especially true of smaller villages. Upottery is home to around 700 people (it’s not tiny but still at the small end) and BT’s predicted cost to upgrade the area, which in total comes to £500k, could perhaps be done more cheaply by using an alternative.

The Connecting Devon and Somerset scheme will, like all other BDUK projects, be seeking extra funding to expand their reach (the current CDS goal is “around” 90% of local premises by the end of 2016 – here) but some are still likely to be left out unless a commitment to cover 100% with NGA connectivity is agreed.

The situation has caused some locals, whom attended a recent public meeting, to question why BT was the only bidder involved in the process. BDUK’s current framework effectively excludes smaller ISPs, unless they can demonstrate a substantial turnover, and the separate £20m Rural Community Broadband Fund currently only seems to approve grants for projects that BT are involved in; usually due to overbuilding fears and controversial data confidentiality with regards to coverage and speeds (here).

Tiverton and Honiton MP Neil Parish said:

“There is always the argument of ‘is there enough competition? Are we getting value for money?“

Meanwhile the Government, through an additional allocation of £250m to the BDUK programme, appears to be pushing for a resolution to the issue and this might involve encouraging a greater acceptance of smaller altnet operators.

Equally nobody would be surprised if most of the local authorities merely ended up awarding the extra funding to BT, which is often seen by councils as a safe bet due to its established network, scale and money pile. But in some areas this might risk overlooking other solutions.

Trefor Davies, former CTO of Business ISP Timico, said separately (here):

“If a village thinks it’s going to get broadband and then finds it isn’t this is likely to cause huge consternation amongst residents. Broadband, or the lack of, is a very emotive subject. I understand this and BT’s desire to avoid the negative PR.

However this lack of transparency is giving rise to too many questions. Does BT have a hidden agenda for example? I am not party to such an agenda but in my mind it has got to a point where someone in authority somewhere should take it out of the hands of BT and the Councils and reveal the detail of the plans.

The cry from BT will be that it would be revealing information of value to its competitors [ISPr ED: street level coverage and speed data]. Surely if we the taxpayer are in large part funding this rollout then the whole competition issue should be irrelevant. The framework for the project put in place by BDUK seems to have scared every other network operator away anyway.”

Some Fixed Wireless Access providers that could probably cover Upottery using less than the £500k envisaged by BT, although whether or not locals would be attracted to such a service is another question. In the longer term there’s a risk that councils which reject wider competition might suffer when it comes to filling in the final 1-5%.

At this point we always think that it’s useful for isolated communities to conduct a local survey of demand so that they can pro-actively demonstrate interest in an upgrade, which is what prospective ISPs like to see. But for any alternative upgrade to work then many councils will need to be ready to look outside of BT’s box.