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BT Openreach Cuts Fibre-on-Demand FTTP Price for “Slow Speed Areas”

Tuesday, October 4th, 2016 (10:31 am) - Score 15,531
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In an interesting move Openreach (BT) has decided to slash the distance based cost of their troubled Fibre-to-the-Premise (FTTP) based Fibre-on-Demand (FoD / FTTPoD) product, albeit only for “slow speed areas” where their FTTC (VDSL2) technology fails to deliver above 10Mbps.

On paper FoD sounds like a good idea, but problems with complicated installations and high costs have hampered its appeal (here and here). At present most people are covered by Openreach’s up to 40-80Mbps Fibre-to-the-Cabinet (FTTC) technology and sadly only a few can access their native “ultrafast” 330Mbps FTTP network (around 330,000 UK premises).

The method behind FoD was essentially to give businesses (or rich home owners), specifically those already covered by FTTC, the ability to have their own FTTP service installed, albeit with the end-user being expected to stomach much of the installation / civil engineering cost involved (this is not the same as native FTTP where you only pay a small setup fee). Obviously this isn’t cheap.

At present FoD attracts a fixed connection charge of £750 +vat and an annual rental of £1,188 (£99 per month) from Openreach (here) and that’s before the ISP adds their own service charges and tax on top. Customers also need to pay a Distance Based Charge for installing the cable, which varies depending upon how far you live from the nearest distribution point (node).

According to Openreach, some 96% of premises are expected to be within 2km of the nearest NGA Aggregation Node. For example, Band A covers 0-199 metres and adds a cost of £200 +vat to the setup price, while Band B covers 200-399 metres (adds a cost of £600) and so forth until you end up potentially spending several thousand pounds.

The good news is that Openreach are about to launch a special offer on FoD for “slow speed areas“, which slashes the cost of their Distance Based Charge and will run between 1st Nov 2016 and 31st Jan 2017. For example, Band A is now £88 and Band B £263 (prices table), which is quite a significant drop.

Openreach Statement

There is a maximum of 10 orders across all participating CPs within the three month period

In order to be eligible for the Special Offer, the following criteria will apply:

* The CP must already be a signatory of the GEA contract and able to place orders via EMP

* The CP has successfully registered with Openreach to take part in the offer through their Openreach sales and relationship manager. Openreach will confirm that the CP is successfully registered to the offer.

* Distances for the FTTP on Demand order must be for bands A to H only. Details of the bands and special offer charges can be found at the URL shown below

* The post code for which the order is placed is subject to a slow speed GEA-FTTC of 10Mbps or less, as shown by the Openreach line checker

* At the time of ordering, the CP indicates “Apply FOD discount offer for slow speed area” in the notes of the order

* The maximum number of 10 orders has not been reached

Participating CPs will be informed on a weekly basis of the number of orders remaining within the Special Offer and will also be informed when the maximum number of orders has been reached. The Special Offer will terminate after the 10th order has been placed by a participating CP, or 31 January 2017, whichever is the earlier.

Orders will be processed weekly, and participating CPs can raise a maximum of 2 orders per week.

Sadly the offer is only open to a “maximum” of five ISPs, but that’s hardly a problem because most providers prefer to take the service via BTWholesale and in any case you’d be hard pressed to find even one that actually promotes it.

We can at least point to Spectrum Internet as one confirmed option. The FoD package offered by Spectrum promises an unlimited 330Mbps (30Mbps upload) service on a 36 month contract for £179 +vat per month, which is coupled to a one-off connection fee from £1,599.

We have asked Openreach for a bit more information and will report back when they respond.

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Mark Jackson
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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46 Responses
  1. Avatar Diggory

    Ten installs total?

  2. Avatar asylum_seeker

    Once a punter has paid potentially £1000’s to have FTTPoD infrastructure installed to their doorstep then surely the monthly service costs should be the same as native FTTP? I mean Openreach are charging ISPs £99 per month for a FTTPoD service yet a native FTTP 300/30 (or 300/20?) BT Infinity 4 is being sold for £50 a month. Why the discrepancy?

    • Avatar Bill

      I agree, can anyone explain this?

    • FoD is a “premium” business product designed more for smaller businesses and attracts a very long contract term, thus it shouldn’t be directly compared with a residential service. One of the reasons why it doesn’t cost even more to install is perhaps also because they can off-set some of that by charging a higher rental.

    • Avatar Ignitionnet

      It started that way but clearly the install costs weren’t enough to make the product worth their while so they recouped some more via monthly charges.

      This is evidently news to Liv Garfield given on an investor call she told them that the monthly rental for FoD was the same as native FTTP.

    • Avatar 125uS

      It probably is of little interest to Liv Garfield, her having been the CEO of a water company for the last 2.5 years.

  3. Avatar NGA for all

    Cool, the install for 2km at £2,200. N-Lon, AndyCH help us interpret this! It looks like you close the underlying cost now of £2 a metre to attach fibre to poles or pull through duct.
    Why not now native FTTP for 10-12 customers by adding a higher connection charge.
    (and do look up Colwarton for update).

    • Avatar fastman

      NGA Is a single premise via the ISP into Openreach Cotwalton was a community via community fibre partnership where all the excess construction charges are covered in the Gap Cost to ensure that all premises can obtain a service at NATIVE FTTP rates

    • Avatar NGA for all

      Fastman – Thanks – and with an AGN in place with spare fibre, poles ok and no tree trimming then there would be no ECC’s?

  4. Avatar Bob

    I don’t object to the install cost, but the ongoing rental charge is a killer for most rural households.

  5. Avatar Mike

    Spectrum’s pricing for FTTP is weird. £49/month for 80/20 with unlimited usage, but all of their other packages have bandwidth limits. 500GB on 330/30 for £109/month.

    Since these packages are aimed at businesses, let’s assume the connection is active for jsut 8 hours per day, 20 days per month.

    500GB of usage averages out to less than 7Mbps. So why wouldn’t you just buy the 80Mb unlimited product?

    • Avatar ouch-my-backhaul

      As BT Wholesale still charge their WMBC customer for backhaul on a per Mbit pricing it forces all but the largest re-sellers to impose some sort of caps, limits or ‘fair use’ policies on services they deliver via BT…

      Whereas other wholesale operators who are offering FTTC services using a combination of the GEA-FTTC tail from OpenReach and their own national network are busily differentiating themselves by offering the end to end service to the point which traffic is handed over to their re-seller customers for a single ‘flat’ rate price.

      Given the costs involved in becoming a WMBC customer its likely that even the smaller access providers with 1g hand-offs will have sufficient capacity to accommodate unexpected burst from individual ‘up to 80mbit’ VSDL services..

      However as BT eventually roll out more 330+ Mbit services via FTTP or G.Fast this seems likely to present the challenge that unless they change the backhaul pricing model their wholesale services will not be financially viable for smaller operators to maintain multiple 10g’s of backhaul capacity to allow more than a handful of their customers on ‘Ultrafast broadband’ to burst to line speed at any one time, nevermind encourage this by offering ‘unlimited’ packages 🙁

  6. Avatar Chris

    Spectrum will only supply FoD in South Wales and the SW anyway. I asked them a couple of weeks ago.

  7. Avatar craski

    Pretty niche offering for a select few situations given that it is only available to premises within 2km of an existing aggregation node and be in a postcode getting less than 10Mbps currently.

    • Avatar Evan Crissall

      …and limited to the first ten customers, from “up to” five comms providers. In other words, fifty or less punters. Form an orderly queue, please, ladies and gents. Or maybe not.

      Such a restricted deal – limited in time too – it doesn’t even warrant a press release.

      That’s probably the objective. It’s a PR stunt. Create a loud razzmatazz over nothing. And BT is banking on none of us reading the small print.

    • Avatar AndyH

      There was no press release – ISPReview are covering a price notification issued to ISPs.

    • Avatar Evan Crissall

      That’s the sly part, isn’t it, Andy. BT gets the toady meeja to dress-up this phony offer as “news”. In A clumsy fudging of advertising and editorial.

      More phony “Good News” from BT. Disguising the pathetic state of “ultrafast broadband” in Britain. While Blighty languishes at the very bottom of the OECD table for FTTP availability:

      http://imgur.com/a/rkaKo

      To mask that reality, BT runs a fake “Special Offer”. Cut-price FTTP for “up to” 50 households across the entire country! And the mindless meeja whoops like a bunch of gorillas. Pathetic!

      Worst still, the closer you read the Fine Print, the more pointless this Special Offer becomes. An Offer so limited, it isn’t worth reporting.

      At most 10 orders per CP. No more than 5 CPs may participate. No more than 2 orders per week, per CP. Only for those in low speed (<10Mbps) areas. BT may "withdraw or limit this offer at any time." BT may reject any order.. "on the basis of any relevant regulatory, legal, technical, financial, commercial or other considerations"

      And yet the meeja still whoops with delight!

      https://www.openreach.co.uk/orpg/home/products/pricing/loadProductPriceDetails.do?data=rO6n%2FrFi70EVo%2F%2BtHd0U%2Bs43DSTzw85S0goeES6ALVWrmMllOOG7b%2F12AmPFLBERe6YShZ82RgLOGLsH2e9%2Bmw%3D%3D

  8. Avatar Chris P

    This is effectively for Exchange Only lines.

    • Avatar Henry

      Really? My perception was that Fibre-on-Demand was not on offer for EO lines.

      Previously Openreach have said “No FTTC cabinet means no FoD” even for people on EO lines close to an upgraded cabinet

  9. Avatar GNewton

    “There is a maximum of 10 orders across all participating CPs within the three month period”

    So does this mean that each participating CP only can offer up to 10 FoD for this reduced price?

    Looks more like a fibre-to-the-press exercise to me. I have yet to see real-world customers using FoD. It’s practically a dead product, BT is not able to provide economic FTTP on a larger scale, its whole mentality is not up for this!

    • Avatar FibreFred

      JNeuhoff you said that when you were err JNeuhoff but the product us still here. Why would you know of any real world use of fod? In your capacity as what?

    • Avatar fastman

      more general mis information as ever I see if there is a community they can approach openreach directly rather than asking their ISP individually which is what FOD is

    • Avatar Evan Crissall

      Love it! You point out, quite reasonably, that the offer is a bum ‘un. And still the BT trolls come out from the gazunder, and screaming with a vengeance!

    • Avatar AndyH

      Good to see Evan Crissall appear from under his rock when a BT story appears.

    • Avatar GNewton

      It’s interesting to see how quickly this discussion derails here, with one poster openly acting as if he was suffering from Prosopagnosia and repeatedly showing his bad manners here.

      So my question again: Does anybody know of real-world FoD customers?

    • Avatar AndyH

      Yes, several people.

      There are a couple on TBB if you want to discuss with them details on the service.

    • Avatar FibreFred

      If derailing is reminding you what you have posted on this subject in the past, so be it.

    • Avatar Evan Crissall

      Haha! Someone has spotted a real-life FTTPoD customer on the ThinkBroadband Forum! Cor blimey! Just the one mind!

      Or was it just another BT shill? Working the forums incognito, as they do. This time, posing as a FTTPoD customer, from their dialup account! Nothing would surprise with BT!

    • Avatar AndyH

      No, it was a user that gave his account of the FOD installation (both good/bad). Just because someone has had it installed, does not make them a shill or puppet of BT.

      There are also a number of users from the original trials.

      (nice wording btw, now I know who you actually are)

  10. Avatar Steve Jones

    It seems to me that some sort of innovation allowing several households (or businesses) to aggregate several orders would be an excellent idea. That could allow the distance related costs to be shared. Even if all the orders can’t be served from one GPON node, if they are reasonably close, it will still be a lot cheaper.

    Then there’s the issue of the ongoing rental costs. I can see that this might well be because the distance related charges don’t cover the full installation charges, but perhaps there could be a different option whereby it covered more of the cost for an aggregated order but with lower rentals. I know this is somewhat similar to the community schemes, but something on a smaller, more easily managed scale would be good, especially if the aggregation of orders could be managed by OR. A sort of subscription exercise such that when sufficient customer commit the process can go through. Ideally the result would look like normal FTTP GPON nodes in time (from a commercial point of view that is).

    • Avatar NGA for all

      ON 2km what distance related costs are incurred that would not be covered in the rental?

    • Avatar Steve Jones

      I’ve no idea what the actual cost would be. It would need somebody with access to actual costs to work all that out. It’s just that I can see that an approach which allows shared costs for aggregated orders as possible and, that if it was to be attractive to average householders, that it really needs to be one that allows for lower monthly charges.

    • Avatar fastman

      Steve its a different conversation

      Fod — single premise Via ISP – ISP takes Risk — Service provider recoups its costs over long term contract
      community fibre partnership – where more that one exists – all the excess construction charges are covered in the Gap Cost (no ISP involvement and Premise can then a FTTPservice at Native FTTP rates from who ever they chose

    • Avatar NGA for all

      Fastman, so what does the £2,200 pay for in the 2kn? It is a basic fibre cable attachment for poles or cable pull through on duct. The extras are ECC + connection cost.
      Where does any incremental distance based cost arise in this instance?

  11. Avatar G Crick

    Is there anyone offering FoD? In Scotland / Glasgow suburb area i see no options other than FTTC

  12. Avatar Kenneth Seabourne

    I find it funny Begging BT to do a Install and survey and there response is its not available….. contacted Spectrum and eh they said £5,000 ex Vat and £300 a month ex Vat…. how the hell? BT offered it well under £179 a month with vat and £0 connection Charge… Why? why spectrum???

  13. Avatar TheManStan

    I still think BT needs to put forward a strategic statement, saying we will be spending X on FTTP deployments per annum – residential, businesses can pay if it is a critical part of their business model.

    Fine if they want an medium term GFAST model. But, they should be able to factor in this kind of long-term infrastructure strategy…

    • Avatar NGA for all

      I agree and I think it should be reflected in Ofcom’s NGA Cost Modelling exercise which will influence WLA pricing and cost recovery.

      We could then get a clearer view of a BT contribution (say £400-£500 pcc). Put that together with the underspends and clawback and we could a very sizable programme.

  14. Avatar fastman

    FOd is nothing to Do With BDUK so not sure what underspend / clawback have to do with anything

    • Avatar NGA for all

      The principles of FoD and fibre extensions are in schedule 2 of every LA contract. The extendability and future proofing of fibre services is key element in the state aid measure.

      Original Fod was not priced as a private circuit but to support FTTP/GPON in areas where the cabinet became in-effective.

      Generous budgets were in place so this work could take place. Thankfully the audit process has kept those budgets in sight.

      I think FoD will change again in the new year.

  15. Can anyone tell how much it will cost to bring in the fibre cable from a pole that is less than 200 metres away. The BT Sales line cannot confirm how much the installation will be. They are very vague and have said I may be charged for the survey and cable and any other work carried out on the day of installation next week.

  16. i have a business customer in cornwall that is desperate for this. they are prepared to pay higher costs for the install and fttp on demand is available for the location and exchange.

    bt local services say it doesnt exist as a service and was ceased as an offering last year (despite it being in the openreach pricelist and wholesale checker)

    noone else will help

    what is the point

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