B4RN Explains the Problem of Bidding for Public Broadband Funds

The CEO of B4RN’s 1000Mbps capable fibre optic broadband (FTTP/H) roll-out in rural Lancashire (England), Barry Forde, has offered up an interest insight into the difficulty of being an alternative network operator to BT when bidding for public funds from the Government’s Broadband Delivery UK (BDUK) office.

Forde’s latest opinion piece, which was published on Trefor.net today, discusses the challenges of putting a bid in for a slice of the additional £250 million that was recently allocated to local authorities across the United Kingdom as part of BDUK’s Superfast Extension Programme.

It’s hoped that the extra funding will help to extend fixed line superfast broadband (24Mbps+) coverage to reach 95% of the population by 2017. But first many councils will need to conduct another Open Market Review (OMR) and Forde suggests that, unless your name is BT, there’s probably not a lot of point in even attempting to bid.

Barry Forde, CEO of B4RN, said:

“The suspicion is that most will simply extend the phase 1 contracts with BT but, fingers crossed, some might take the opportunity to run genuine tenders which could open things up for community groups. First, though, each authority needs to run an Open Market Review to establish what work is going to be done by the commercial operators in the coming three years.

So let’s look at how all of this works from B4RN’s point of view. As a network operator building a network we have been asked to respond to Lancashire’s OMR with details of what our plans are, and as I see it we have three options, none of which appeals to me:

1.Ignore the OMR and don’t respond. If we do this then our Local Authority can ignore us and assume that any areas not covered in phase 1 is “White” (i.e., no existing operator), and therefore eligible for subsidies from the phase 2 kitty. They could choose to simply add these areas to the existing phase 1 contract or they could go out to tender for them, in which case B4RN could respond to the tender.

2.Respond to the OMR and list our targeted areas but say that these plans involve us bidding for public funds. The Local Authority is then perfectly free to ignore our plans as they involve public money and the OMR rules says these plans can be ignored, so the area stays White and we revert to 1 above.

3.Respond to the OMR saying that our target area is going to be built come hell or high water, and we will find some way of building out to all 3500 properties in our patch. If we do this then the State Aid rules say we cannot bid for any public funds as the market is going to deliver ,and our area is now grey and not eligible for grants. In theory, this should also prevent LCC from funding BT to build out in those post codes too. As the phase 1 postcodes have not been disclosed by LCC, however, they can at any time state that a specific patch is being done via phase 1 funding, not phase 2, and go ahead. I cannot see any way to stop this from happening.

Options 1 and 2 mean that it is very unlikely we would get any funding via the phase 2 project, as our Local Authority has a close working relationship with BT and I’d be utterly astonished if they allowed us a sniff at the money. The probability is that they would extend the phase 1 contract with BT or, if not, do a new procurement structured to keep B4RN out.

Option 3 means we are locked out of any funding anyway, and still will not have protected ourselves from a BT overbuild. But what we have done is committed the rural community to find 100% of the money and effort needed to build out the network. It becomes simply a matter for the Local Authority and BT to cherry-pick anything that looks remotely attractive to them, claiming it was in the phase 1 plan, and leave B4RN with the extortionately expensive and difficult bits.”

The full article is well worth reading and Forde concludes that the decision they’re left with is “do we drown or do we burn?“. Forde also complains about the short 28-day window to respond to LCC’s OMR and suggests that “the best way would be to not respond and to let the Local Authority fund BT to go out as far as it can, and then B4RN simply overbuild BT as and when community effort and funds permit … we have no worries about competing with a subsidised BT“.

The community investment behind B4RN, which sees local people putting both their own time and sometimes money into helping to build out the network, tends to result in strong take-up and Forde appears to be banking on that for the future. But it could be risky to shun the OMR because it’s a lot easier to attract support for a product in areas where only slow broadband is available than in those where BT has already rolled out FTTC or perhaps even FTTP.

Never the less it’s hard not to sympathise with B4RN’s position and the sometimes stifling bureaucracy, which often seems to defy common sense, of how the BDUK programme appears designed to work.