JT Warns of Fibre Optic Broadband Rollout Delay for the Island of Jersey

The roll-out of a new 1Gbps capable Fibre-to-the-Home (FTTH) broadband ISP network on the English Channel Island of Jersey, which is being conducted by the state-owned JT Global (Jersey Telecom), looks to be under threat after the local government (States of Jersey) requested a £6m dividend from the Telco to help it plug a £31m budget deficit for 2014 (rising to £39m in 2015).

The latest problem for the island community was first revealed during an early budget announcement in July 2014, which saw Senator Philip Ozouf confirm that income tax revenue was lower than forecast and spending had gone higher.

Funnily enough we recall that Mr Ozouf had in 2013 been heralding the benefits of a small 1% reduction in the rate of income tax (26%) and at the same time he even outlined plans to use some of the islands £720m “strategic reserve” (government savings fund) to pay for a new hospital. So perhaps we shouldn’t be surprised that the deficit problem has returned.

According to the BBC, Jersey law effectively requires that the deficit be tackled before a budget can be presented to the states for debate and as such Mr Ozouf has been busy hunting for additional funds to help him plug the hole, part of which will come from asking state owned companies like JT for more money.

The problem is that JT’s £41m+ Gigabit Isles project, which is currently aiming to rollout FTTH to around 42,000 premises (990km of new fibre optic cable) by the end of 2016 (plus 5,000 on Guernsey), is part funded to the tune of £19 million by the States of Jersey via a freeze on dividend payments. In other words, any move to take back money from JT will inevitably hit that effort.

The latest data reveals that JT’s fibre optic network had already managed to connect 11,000 customers to the new service, which is up from 10,000 in August 2014, 8,479 in June 2014 and 7,600 in March 2014. Graeme Millar, CEO of JT Global, has already warned that the lost funding would stop it from achieving the original 2016 completion target and the Telco is currently reviewing their future roll-out plan.