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UK Government Targets 98% Superfast Broadband Coverage via £645m Clawback

Saturday, September 9th, 2017 (12:01 am) - Score 1,315
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The Government’s £1.6bn+ Broadband Delivery UK project has today confirmed that a total of £645m in public funding (i.e. clawback and efficiency savings) will be returned to help expand the reach of “superfast broadband” (24Mbps+) to 98% of premises in the United Kingdom by around 2020.

At present the BDUK scheme hopes to help put “superfast” capable fixed line (or in some cases fixed wireless networks) within reach of 95% of UK homes and businesses by the end of 2017 (they’re currently at around 93-94%), although it’s hoped that a combination of clawback linked reinvestment and efficiency savings could now push this to 98% by 2020. The proposed 10Mbps USO is then expected to handle the final 2% (here).

Last month BDUK revealed that their £1.6bn+ public investment (i.e. government and local authorities) had so far helped to put “superfast” connectivity within reach of nearly an additional 4.6 million premises (here), which is on top of the c.70%+ of premises that have already been upgraded by purely commercial deployments. The latest data shows how this progress splits down via the different regions.

Nation/Region Homes and Businesses
North East England 152,784
Yorkshire and the Humber 365,778
North West England 408,766
Midlands 675,761
South East England 499,510
South West England 571,465
East of England 567,345
Scotland 632,972
Northern Ireland 46,949
Wales 653,315
Total 4,574,645

Average take-up by consumers in related areas is also known to be running at 38% (here), which is very strong. Once again BDUK has kindly provided a regional split and we hope to publish a more detail take-up report for each project area later today or tomorrow.

Nation/Region Take-up Rate (BDUK Areas)
North East England 37%
Yorkshire and the Humber 37%
North West England 37%
Midlands 38%
South East England 44%
South West England 39%
East of England 42%
Scotland 34%
Northern Ireland 33%
Wales 37%
Total 38%

Understanding take-up is vital because it links into the clawback (gainshare) mechanism of BDUK’s local contracts, which requires suppliers (i.e. predominantly Openreach (BT)) to return part of the public investment when customer adoption of the new service passes beyond the 20% mark in related areas. This can then be further boosted by any efficiency savings made during the roll-out.

The returned funding is intended to be reinvested towards further coverage improvements via future contracts. BT alone recently indicated that they had deferred £465 million (here), which could potentially be harnessed in this way.

On top of that BDUK has today revealed that this will be combined with project efficiencies of £180 million, which they say have resulted from “successful management and delivery of the programme.” Some of that may have also come from the greater use of cheaper FTTC instead of FTTP during the first roll-out phase.

An estimate of the combined reinvestment can be seen below and this may increase further as contracts complete.

Nation/Region Money available for reinvestment by local authorities (projected)
North East England £27.7m
Yorkshire and the Humber £44.7m
North West England £60.3m
Midlands £113.4m
South East England £90.3m
South West England £79.5m
East of England £87.7m
Scotland £78 m
Northern Ireland £7.9m
Wales £56.3m
Total £645.8m

The Government predicts that this reinvestment of £645.8 million should be enough to go from 95% to 98% coverage by around 2020, which they say would benefit an additional 900,000 premises beyond the original plan. Apparently £200m of this £645.8m has already been committed to related projects.

Matt Hancock MP, Government Minister for Digital, said:

“We have now brought superfast broadband to almost 94 per cent of UK homes and businesses, and we are reaching thousands more every week. We are on track to reach 95 per cent by the end of the year, but we know there’s still more to do.

The money that is now being returned to the programme for reinvestment will help us reach that final 5 per cent, and is all part of our commitment to make sure that 100 per cent of the UK can get affordable, fast and reliable broadband by 2020.”

The Government often takes a lot of flak for their programme, usually from the most remote rural communities that are being left until last to benefit (somebody always has to wait longer), although in fairness we can’t think of many major public sector contracts that have actually managed to hit their targets. At present fixed line “superfast” coverage sits at around 93-94% and thus the next 95% goal does look set to be achieved.

On the other hand it’s worth remembering that 95% is a national average and so some areas, such as the Scottish Highlands, as well as some of the more rural counties in Wales, Northern Ireland and England, may struggle to reach that level. Likewise the figure of 95% is an estimate and one that can’t always account for complicated problems with local capacity or poor home wiring etc., which may impact real-world service performance.

However it’s long been clear that BDUK won’t finish at 95% and they clearly intend to carry on for the next few years (as above), which will reach ever more rural and isolated communities.

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Mark Jackson

By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he is also the founder of ISPreview since 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.

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25 Responses
  1. Steve Jones

    I estimated a couple of months ago that coverage might just hit 98% with the use of clawback and savings. It also surely means the 10mbps USO gap will be fairly small as, presumably, that 98% is at SF speeds and there will surely be a substantial fraction on enabled cabinets that won’t make that speed, but will exceed 10mbps.

    If LR-VDSL is permitted, even selectively, then it will narrow that further (and put more properties on SF speeds).

    In any event, I think the government giving the impression this is new public money when its not. It’s recycling the original BDUK money, albeit that whoever dreamed up the gainshare mechanism deserves credit.

  2. Dave

    I wish they would just hurry up and do something. Being stuck on ADSL @5Mbps is rubbish. FTTC cabinet is enabled but where I am is 2km from the cabinet so can’t order FTTC. There another 180+ properties in this area all with the same problem (not all on the same cabinet) but all a long way from the FTTC cabinets. We need FTTH or FTTrn (g.fast from the poles). G.fast from the cabinet will be useless to us but suspect that’s what will happen first… in about 2-3 years time :@

    • Bill

      I agree you with Dave, my own situation is practically the same.

      Perhaps the returned BDUK funds could be reserved exclusively for extra cabinets and remote nodes.

      I can understand why BT are reluctant to cable up a remote property miles from anywhere, but where there are significant numbers of properties clustered together, it is disgraceful to keep ignoring them.

    • Steve Jones

      It will be impossible to reach 98% without dealing with clusters of 40-50 houses, although if they are widely spread, that’s much more of an issue.

      However, if LR-VDSL2 is approved by Ofcom, even selectively (which would involve turning of ADSL through those cabinets), then a 2km has the potential to exceed 24mbps on some modeling. LR-VDSL2 is also at the core of BT’s USO offer as it might enable 10mbps at up to 3.5km from the cabinet.

      However, introducing LR-VDSL2 would require a lot of co-ordinated effort as it would need new modem/routers and lots of configuration changes by the ISPs in question as all the BB lines through the cabinet would have to be connected and moved to GEA-FTTC services in a very short period. I also expect a lot of objections from LLU operators unless any proposal is heavily constrained by location.

      Note that those are on the most advanced version of LR-VDSL2 that have been modelled.

    • Bill

      I would say you are muddying the picture, we do not need more sellotape solutions such as LR adsl or LR vdsl just to meet USOs.

      10mbps at 3.5km is a pretty lame offering. We need that 3.5km figure to be reduced substantially with more cabinets or nodes, so futureproofed speeds can be obtained.

    • Gadget

      So Bill, you’ll be writing the cheque to pay for the solution you want?

    • Bill

      Gadget… did you bother to read what I wrote? All of it?

    • Fastman

      or you could work with your community and co fund with Openreach a new cabinet for all of you if you all on the same exchange

    • Steve Jones

      @Bill

      It may be, but unless there’s a source of money for the USO (public funding or, perhaps, a levy) then it’s going to use the most cost effective solutions, and that’s LR-VDSL2 in some cases. If that’s not approved, then OR seem extremely to take on a USO, and if there’s no extra source of finance, there’s not much legal basis to impose one.

    • MikeW

      @dave @bill
      Infill is already happening, adding new AIO cabinets and reducing copper lengths even further.

      AIO cabinets seem to be preferred to FTTRN nodes, but are essentially the same idea.

      Such Infill will continue to be a feature of the rest of phase 2, and any of the clawback projects. As well, of course, as FTTP.

      BT are still upgrading around 200,000-300,000 lines with NGA each quarter; hopefully Gigaclear will be making a dent on the figures too. But with more than 1,000,000 still to go, there are plenty who can feel they’re being ignored.

    • MikeW

      @steve
      Clusters of 40-50 properties are somewhere around the 96th percentile. You’re getting much smaller out at the 98th percentile.

    • Bill

      @MikeW Can you give some idea how many new cabinets have been installed? I suspect the number is pitiful, but I would love to be wrong. Cabinet expansion seems to be way down BTs list. My local cabinet has been not accepting VDSL orders for practically two years and it hasn’t been upgraded… so I don’t have much faith that a load of new cabinets is on the horizon.

      How about OR publishing a list of proposed new cabinets for the next two years? Then we can see if there is any substance to this.

    • MikeW

      I’m afraid I can’t tell you the numbers for infill cabinets … It is hard enough to just find out how many cabs have been upgraded in total.

      That total is now around 84,000, whereas BT reckoned there were only 80,000 PCPs back in 2009. And there are plenty of old cabs that haven’t been upgraded.

      Andrew at TBB obviously has a better idea, as he has rejigged the coverage statistics because of the extra infill cabinets. There are obviously a fair number of infill cabinets going in.

      One example is the Leyburn exchange. Back in 2013, there were 9 PCPs, and 5 cabinets due to be upgraded by the BDUK project.

      Since then, the exchange has had all 9 cabinets upgraded to NGA, then had an FTTRN node added (creating a tenth PCP) for infill. Then an 11th PCP was added (a similar size to the tenth). And now there are another 6 cabs due to be added/upgraded.

    • MikeW

      Incidentally, the stats suggest about 150 cabinets being added per week.

  3. Patrick Cosgrove

    Do we get to see a breakdown of the sums per local authority? Regional figures aren’t much help in holding one’s local council to account?

  4. timeless

    why am l not surprised about them clawing back money… l guess they have to find the money somewhere for that huge 1bn sum they promised to charities but somehow went missing that lve been reading about recently, but my guess is this whole DUP deal is where all the money is going.

  5. RuralBroadbandNorthernIreland

    Seems like it must be going directly into the DUP politicians pockets as the 46000 number doesn’t seem that impressive in comparison to other regions, and if you look on Thinkbroadband, my constituency Tyrone & Fermanagh, Northern Ireland, is ranked 648 out of 650. The £150 million ultrafast broadband stated investment in Northern Ireland doesn’t seem be going to where it is was stated it should go.

    • MikeW

      The first round of investment for fibre broadband, in Northern Ireland, wasn’t classed as a BDUK project, so isn’t counted in the BDUK statistics. NI only joined in with BDUK in phase 2.

      Given that phase 2 BDUK projects are about a quarter to a third of the size of the phase 1 projects, you’d expect considerably fewer premises in a place that only counts phase 2.

      In addition, NI is a smaller region than most of the others.

      Those 2 combined will explain the magnitude difference between the figures.

      In addition, NI has a very different pattern of line lengths (D-side, that is) to the rest of the UK. This means more infill work (adding extra cabinets), which is relatively more expensive, so achieves less per £.

  6. NGA for all

    The DCMS and Ofcom consultations referenced 97% in July/August, are now 98%. The balances in the investment accounts held by LA/DA have not been referenced so some more may be become available there.

    Does this mean the Government will reject the BT _USO offer, or just instruct Ofcom to delay the USO until all BDUK work is completed?

    About half the USO numbers identified by the DCMS USO documentation were urban reflecting BT portfolio preference to mis-sell private circuits. If ‘competition’ covers these, then rural could get an intense level of FTTP rather than another batch of copper gain kit leaving gaps. The real lesson is that the material is much cheaper than originally portrayed and the issue is resource and a will to do the job We should not settle for interim copper gain kit, but push on with transforming the more difficult to reach areas with the remaining monies. BDUK monies was for rural, not an urban in-fill.

    The gaming of costs and capital by BT Group on this project has occurred at the expense of the BT and Openreach engineering community doing a better job for the UK rural economy and BT shareholders.

    This is before it is acknowledged that BT’s commercial investment was not £2.5bn as promised but closer to the £1.5bn (to 2015) identified by Ofcom in their analysis of the ‘fair’ bet.

    • MikeW

      “(to 2015)”
      You’re at least accepting that your old argument was nonsense. Now its nonsense hiding behind a mask. But it is more likely to be “(to mid-2014)”.

      The money was for “final third” without specifying rural or urban. It was just assumed by everyone to be rural, but not checked.

      BDUK’s analysis of the final 5% (which we’re now nearing) was that it comprised 1% of properties that were so remote, they’d need to be left to satellite. 1% was urban. And 3% was rural. I wonder where Ofcom’s assessment came from? The back of a lunchtime napkin?

      DCMS and Ofcom referenced 97% in July/August… not because they newly, independently, came up with those numbers. They merely regurgitated figures from previous reports, much like the content of a lot of such reports.

      Now the government has said 98%, but do you think people will keep re-counting afresh for every new report from now onwards? Or just regurgitate the 98%?

    • NGA for all

      MikeW – wow, SA33671 doc (State Aid approval) referenced rural 19 times and clause 21 demands urban is subject to a separate notification. It even references the final third.

      I would expect Gove to 1:Examine the commitments made by BT in Wales, the R100 ambition in Scotland, the £150m available in Northern Ireland and the discount the numbers by the plans in English counties exceeding 97%.

      What is wrong with an upside for the taxpayer? What is wrong with calling BT to account for commitments made?

    • MikeW

      I can’t be bothered to look yet again, to refute your nonsense yet again…

      Last time we ran through this argument, it was obvious that the state aid document
      a) made the same mistake as HMG in using the word rural. It only uses it as a generic adjective for the programme, but doesn’t restrict the work to only rural areas. It just assumed that uncovered final third would be rural … Like everyone did in 2011/12 … 3 years before the commercial rollout was expected to finish.

      In the context of the time, no one knew that “final third” wasn’t synonymous with rural.

      If it meant to restrict things to rural areas, we would have seen a hefty definition of what “rural” actually meant. Even now, it could readily mean anywhere from 8% to 23%, IIRC.

      b) only used the phrase “urban” to describe the other project being run by DCMS at the time – the one for ultrafast in urban areas.

      As we know, that went through separate state aid approval, as this document referenced. Even though it turned into a voucher scheme in the end. The requirement for separate notification wasn’t a vague, hand-waving restriction … It was a reference to something already going on.

      In the context of the time, there was one rural scheme, and one urban scheme. The rural scheme was a final third, superfast scheme to cope with market failure. The urban scheme was an ultrafast market Kickstarter. They were distinguished by the rural/urban monikers. As it turns out, though, neither scheme was restricted to its original rural or urban domain. As the urban scheme morphed into a voucher scheme with limited takeup, it was opened up to the surrounding rural areas too.

      Remember too that HMG went through BDUK allocations, and gave money to almost every area … Including ones that are exclusively urban. Aside from London, the only council that didn’t get money was IIRC Manchester, even though the other constituent councils of Greater Manchester did.

      I would expect Gove to not know his arse from his elbow. Not sure what your point is, otherwise.

      Nothing wrong with holding BT to account. Just an expectation that it gets done by the right people.

      Conversely, what’s wrong with holding you to account over your numbers?

    • MikeW

      I’ll add something…

      Everyone is lazy when it comes to adjectives describing things.

      The two dcms programmes just picked up the easiest, laziest, most obvious monikers of rural/urban.

      A bit like marketers using the word “fibre”. Easy, simple, lazy. But not wholly accurate.

    • NGA for all

      MikeW – DCLG classification of urban and rural and all things in-between are clear and quantified and are the official reference point for such matters.

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