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East Riding of Yorkshire Suffers GBP10m Broadband Funding Shortfall

Thursday, June 9th, 2016 (3:13 pm) - Score 636

The Broadband East Riding project in Yorkshire (England), which is being conducted with support from BT, will need another £10 million of funding if it is to reach the goal of making a superfast broadband (24Mbps+) network available to 95% of local premises.

The original Broadband Delivery UK supported contract, which was worth around £14 million (£4m from BT) and signed all the way back in September 2013, aimed to extend Openreach’s (BT) 24Mbps+ capable FTTC/P network to an additional 42,734 homes and businesses in the region by December 2015.

A second £5.4m extension contract was also signed last June (here), which saw BT commit £400K to the scheme and BDUK doing the rest. The second contract aimed to push the related service out to cover another 4,500 premises, but a new report suggests that even with this support the local area may only achieve 90% coverage and that to hit 95% they’d need to find another £10m.

As it stands only a little over 70% coverage has so far been achieved in the East Riding area.

Andy Elliott, East Riding Council’s ICT Boss, said (Hull Daily Mail):

“The remaining 5 per cent are in the really rural areas, which are also the most expensive in terms of providing the necessary infrastructure. There is an estimated shortfall of about £10m at the moment, which is needed to reach that 95 per cent target. Meeting that shortfall depends on the future commercial plans of BT but we are also lobbying MPs and ministers, as well as having discussions with Chris Townsend, the chief executive of BDUK, over the issue.”

At this point it’s worth remembering that the Government’s 95% coverage target is a national one, which means that some areas may complete with a lower coverage figure than 95% and others will finish with more.

On top of the current work many parts of East Riding, such as around Hull, are also being catered for by KCOM’s commercial roll-out of FTTC/P “fibre broadband” services. However both that and the BT / BDUK project will still leave some rural areas uncovered, which are very expensive to tackle; it’s hard to see these being tackled by BT on a purely commercial basis.

We suspect that the forthcoming 10Mbps Universal Service Obligation (USO) and related technologies may ultimately be required to improve connectivity for most of those in the final 5-10% of East Riding, although key issues of cost and connection technology have yet to be resolved. A few may be left with no option but to take a subsidised Satellite service.

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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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9 Responses
  1. Sunil Sood says:

    According to the figures published here earlier this week, East Riding has a take-up of 27.2% so they will be due some clawback as well – though nothing like £10m of course

  2. DTMark says:

    “Meeting that shortfall depends on the future commercial plans of BT”

    Does it not depend far more on the number of companies who responded to your tender request and how much commercial investment they’re willing to make?

    Or, have you only asked BT?

  3. Steve Jones says:

    This is confusing. The original P1 42,734 added to the P2 4,500 premises makes for 47,234 premises at superfast speed. There is an existing number which will have been already enabled under the commercial program. The numbers above under BDUK are surely contractual and therefore locked in.

    So, surely, it’s possible to work out the “worst cast” coverage which is the sum of P1 & P2 targets plus the existing commercial divided by the total number of premises. Does this report tell us what this actual baseline is? Just how much many premises does £10m enable in this context?

    The local BDUK website is useless on this matter. It is almost devoid of stats and it is surely not unreasonable to know what is already contracted.

  4. MikeW says:

    Don’t discount the KCOM effect.

    In this case, BT is almost certainly covering the same kind of “rural” premises as is happening elsewhere in the country. It would almost certainly reach the same total coverage as it is reaching in the rest of the country, too … if it were responsible for the entire county.

    However, BT aren’t responsible for the entire county … as a very big proportion will be being left to KCOM. There is *some* overlap where both BT and KC cover, but it isn’t a huge overlap.

    The total percentage that actually gets covered comes from combining the effect of both companies. And, as we know, KC are progressing far slower than BT.

    I can only imagine the £10m ends up buying one of two things:
    – KCOM’s involvement in rural areas, or
    – BT’s extension into previously KCOM-only areas.

    1. Steve Jones says:

      I hadn’t even considered KCOM. Does that mean the whole KCOM area has been missed out? Would that have happened because of the OMR and KCOM essentially blocked any of its locations being in the intervention areas?

      Presumably BT would not have included any of the KCOM areas in its bids, so that’s potentially a hole.

      In any event, the availability of actual stats is abysmal.

    2. MikeW says:

      The City of Hull has been missed out, but it is unknown why. Perhaps it got labelled like London, as handled commercially, so got no money. Perhaps the council refused to get involved, perhaps with a desire to see KC offer FTTP, perhaps having been lobbied by KC. It could also have been because KC reported that they had plans to cover the full area in 3 years – but they patently haven’t been rolling out at a speed that would ever have achieved that.

      The county of East Yorkshire is a little different, as I guess the land mass breaks down into 3 distinct areas: BT-only, KC-only and BT+KC-overlapped-coverage.

      I don’t imagine that BT bid to cover any KC-only areas: I’d assume that the value-for-money tests (and even the maximum £1700 per premise) wouldn’t have covered an expansion of the network.

      Whether KC then prevented BDUK coverage in any of the overlapped area, by claiming commercial coverage within 3 years, is unknown. Certainly there are places within the overlap that have been funded by BDUK (an example being BT’s Leven exchange, which covers a similar area to KC’s Leven and Brandesburton exchanges), so KC must be coming under some pressure from churn in those places.

      My working assumption is that KCOM came under a lot of pressure to speed up their rollout, and chose to sell their national network to cityfibre to fund it.

    3. Keydogg says:

      Mike you would be correct with a lot of your assumptions.

      – The City of Hull wasn’t completely left out, but it was only businesses who could benefit. KCOM offered a BDUK voucher scheme for businesses last year in which they could have a grant for FTTP which would give them free installation. This could cover up to 3 premises (including directors’ homes, which is what I did!), but a maximum value of £3,000 was put on the voucher. This has been great for KC as it has ‘opened up’ a lot of areas to fibre as the main infrastructure has been upgraded in these areas, so future work will be much easier.

      – BT couldn’t get BDUK in the overlapping areas IF KC had already pledged that they would be covering that area within the next x years. Parts of Keyingham and other places are examples of this, where only a few of the BT cabinets are/will be upgraded to FTTC.

      – KC have come under a lot of pressure to increase their Superfast upgrades which means they have decided to do two things: install VDSL cabinets in the outer villages that they cover (these are up but no one can actually order VDSL yet), and; they have increased the rate at which they are installing FTTP within the city approximately quite significantly.

      Agonisingly my business is 300 yards outside the KC fibre area, and we’ve had a quote from them for fibre which came to £12k (due to obstacles in the way etc), and our BT cab is 2.7km away (so no FTTC) and trying to order FTTP/FTTPoD/FOD with BT is a bloody nightmare but hopefully we’re getting there slowly.

  5. NGA for all says:

    Originally £14m for something like 250 structures or £58k each unless there is some FTTP ambition. Clawback from the £258m should be £3m eventually and so BT capital needs to happen during the true up which should be.c£5.5m (a proportion of BT £485m number given to CMS).
    I do feel sorry for those in OR trying to plan an efficient network when the numbers are being gamed to the level they are.

  6. SB84 says:

    Hull is not within East Riding’s intervention area, it is a different local authority and different project entirely.

    To be fair to the East Riding Broadband project, they are suffering from KCOM slower than expected rollout, their actual BDUK deployment has completed as expected.

    But they could and should communicate better.

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