Cambridgeshire UK Prep Plan for Future Phase 3 Fibre Broadband Rollout

The Connecting Cambridgeshire scheme in England, which is currently working with BT (Openreach) in order to make FTTC/P based “superfast broadband” (24Mbps+) services available to 95% of the county by 2017, has said that another 7,500+ premises could benefit from a future contract extension.

Phase 1 of the original £29.75m contract, which extended BT’s superfast network to 90% of people in both Cambridgeshire and Peterborough (98% if you include sub-24Mbps areas into the raw “fibre broadband” footprint), officially completed in January 2016 (here) and it’s understood that the superfast reach is now closer to 93%. Overall 97,000+ extra premises have benefited.

A second (Phase 2) extension contract has also begun its deployment phase and this should add another 6,000 premises to the total and take the “superfast” coverage to “at least” 95% of the county by the end of 2017. By comparison the official announcement for a Phase 3 roll-out offers precious little detail, but ISPreview.co.uk has done some digging to reveal the tentative plan (see below the quotes).

Councillor Ian Bates said:

“The Connecting Cambridgeshire broadband rollout has covered almost a third of our homes and businesses, but we know there is still more to do to fill the gaps and make sure no community misses out.

We’ve seen some of the highest take-up in the country, particularly in rural villages, and I’m delighted that BT has made the £5m gainshare available early so it can be invested in helping even more people in the county to get faster Internet connections.

We want Cambridgeshire to be a leading digital county, and our productive partnership with BT, together with the additional Government and EU funding won by the programme for digital projects, means we can achieve this within our original investment.”

Dave Hughes, BT’s East of England Regional Director, said:

“It’s great news that so many people have chosen to upgrade to faster broadband in Cambridgeshire. Such high take-up of the service has enabled BT to offer a further £5.3m success dividend to re-invest back into the Connecting Cambridgeshire programme to connect some of the hardest to reach properties. This builds on £18m BT has already contributed to the rollout, and we’ll continue to work closely with Cambridgeshire to ensure we reach as many homes and businesses as possible with the investment available.

There’s still more to do, but engineers from BT’s local network business, Openreach, are working hard to ensure the rollout continues as quickly as possible. Our network is open to all broadband providers so people can choose from a wide range of providers. Fibre broadband is not provided automatically. People need to arrange an upgrade with their chosen service provider.”

Apparently around 18,000 premises will be left stuck in the “final 5%” once Phase 2 has completed. Interestingly the council believes “it is unrealistic to target 100% of premises with Superfast broadband“, although they have instead pledged to “significantly reduce” the gap.

Funding for Phase 3 (total £8.1 million), as hinted above, so far comprises £5.3m in BT clawback (reinvestment stemming from high take-up in related areas) and another £2.8m of underspend from the Phase 1 contract (much of that probably came from a greater focus upon FTTC instead of FTTP, as well as roll-out efficiency savings).

However the contract payments are made in arrears and thus the precise Phase 3 figure will not be confirmed until the last quarter milestone payment, which is due by June 2016. But we do know that Phase 3 is expected to benefit “at least 7,500” additional premises, which could push the coverage of “superfast” speeds to 97% and this would make the full FTTC/P footprint almost universal.

Cambridgeshire’s Phase 3 Plan (Extract from Council Meeting)

Inevitably deployment to more geographically dispersed, harder to reach premises, is more costly and all interventions are subject to a state aid threshold of £1700 per premise. However based on estimates to date, it is anticipated that a third deployment phase will deliver Superfast Broadband to at least 7,500 additional premises, with fibre based broadband (typically between 10-15mbps) available to significantly more.

It is anticipated this would increase the combined Superfast coverage to around 97% of the county and significantly reduce the numbers currently unable to access fibre based services. At present these are high level estimates only because confirmed deployment is subject to detailed technology solution planning.

Although subject to final legal and state aid checks and sign off via Government state aid assurance process, it is anticipated that Phase Three will be agreed under contract change control. This will be quicker and less costly than a new procurement exercise.

The alternative option, not to support a third phase Superfast Broadband rollout, and to return funding for reallocation to the Council, would require revised contractual negotiations with both BT and with the Government funding bodies. Funding from the claw-back mechanism would not be available to the Council until June 2024.

It’s suggested that Phase 3 is likely to run until late 2019 or early 2020, with work probably getting under-way in 2017. However no new contract can be signed between BT and the local authority until the Government have reached a new state aid agreement with Europe, which at the current pace might not even be ready to use until May 2016.

Either way it’s interesting to note that Cambridgeshire is one of the first local authorities to actually agree a plan for spending BT’s reinvestment via clawback and underspend. Meanwhile it remains to be seen whether or not the council or Broadband Delivery UK will contribute any additional investment; none is mentioned.