Cambridgeshire UK Achieves 95% Coverage of Superfast Broadband Target
The Cambridgeshire County Council has announced the completion of their Phase 2 Broadband Delivery UK contract with Openreach (BT), which has successfully expanded the coverage of FTTC/P based fixed line “superfast broadband” (24Mbps+) networks to 95% of local premises by the end of 2017.
So far more than 120,000 extra homes and businesses across Cambridgeshire and Peterborough have been put within reach of the new service (note: you have to order the new service in order to receive faster speeds) and take-up in related areas stands at 50%.
The effort has been supported by the construction of 700 new “fibre broadband structures” (we assume they mostly mean VDSL2 street cabinets / DSLAMS) and over 1200km of fibre optic cable.
Last year the Connecting Cambridgeshire project revealed that completion of Phase 2 could still leave around 18,000 premises to be unserved by superfast speeds, although a new Phase 3 contract was signed in March 2017 to address this (here). Under the new deal it’s expected that coverage will be expanded from 95% to 97% by the end of 2019 and this would then be followed by a future Phase 4 that could aim for over 99% by the end of 2020.
Matt Hancock, UK Minister for Digital, said:
“It’s great news that Connecting Cambridgeshire has exceeded 95 per cent coverage and I’m delighted to hear of the programme’s ambitions to extend the rollout and reach everyone who wants high speed broadband.
We know there’s still more to do but this government is committed to ensure that 100 per cent of the UK can get affordable, fast and reliable broadband by 2020.”
Steve Count, Cambridgeshire County Council Leader, said:
“Digital technology underpins almost every aspect of modern living across work, travel, leisure and health fast, reliable Internet access is now widely viewed as the ‘4th utility’.
I am proud that Cambridgeshire has maintained its position as a leading digital county by exceeding the national target of 95% superfast coverage several months early, which is testament to our strong working partnership with BT and Openreach.
We know there is more work to do to fill the remaining gaps and the high take-up of fibre broadband means we can now extend the rollout at no extra cost to the County Council with money that the County has secured from BT and has returned to the programme for reinvestment.
Connecting Cambridgeshire continues to have high aspirations and is also bidding for further funding to improve digital connectivity so that our rural businesses can grow and compete, wherever they are based.”
We note that Phase 4 is expected to focus on upgrades for around 12,000 premises and, unlike Phases 1 – 3, the local authority has said they would need to conduct a new procurement. The strategy for this has been devised with an accompanying “lot” approach to determine the optimum way to provide coverage for the remaining premises, which could attract alternative network providers like Gigaclear (FTTP) or Airband (Wireless) etc.
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, Google+, Facebook and Linkedin.
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99% good to see, another county where the B-USO ambition can be re-written around a right to order a direct fibre connection off heavily subsidised infrastructure.
@NGA
You appear to be suggesting that the USO should be tailored. Surely it stops being a *universal* service obligation if it varies around the country?
Really? Is that right going to be extended to anybody not on an FTTP connection? If not, at what speed threshold are you going to provide people with the right to demand FTTP connection?
In any event, is this going to be subject to a excess construction cost threshold? BDUK fibre infrastructure or not, some properties will be a long way from fibre distribution points.
Then there’s the little problem of who is going to be charged with fulfilling this USO as I can’t see OR signing up to such a thing. In addition, have you actually made any sort of cost estimation for this proposal and how the required cross-subsidy will be met?
New-Londoner & Steve.. no, by the next WLA (2021), we could include the notion of ‘reasonable demand’. It could be defined and added to the WLA product definition which already includes FTTP for cost recovery purposes. ‘Reasonable demand’ could exclude where ‘ultrafast’ was available with G.Fast.
Some good legwork on revised FoD, the £700 per premise in a PON is an early proxy. I do not understand the FoD reliance via SP’s, where BT is offering FoD as part of Voluntary offer and it is being modelled by Ofcom in the B-USO work.
Ofcom might for political and expediency purposes appoint BT as B-USO provider and define the services as a separate exercise once the BDUK funds and deferrals are exhausted.
IMHO the 10Mbps was an uninformed political whim which needs kicking down the road.
@NGA – interesting words ‘a right to order’. What does that mean? At any price?
@NGA
So your proposal appears excludes the USO being applicable to locations with ultrafast speeds (which exclude those with VM or G.Fast options), but allow those with only superfast speeds to demand an FTTP connection at some sort of standard charge (and not the new FTTPoD pricing model). That’s potentially a huge amount of capex as it covers about 15 million properties and it would have an enormous potential impact on the current FTTP/VDSL cost recovery model. That’s before we even consider the availability of labour. Of course you mentioned BDUK subsidised infrastructure, so if your USO is confined only to the “white areas” that would limit it to perhaps 6m properties, albeit at the more costly end of the provision scale.
“I do not understand the FoD reliance via SP’s, where BT is offering FoD as part of Voluntary offer and it is being modelled by Ofcom in the B-USO work.”
I would have thought that obvious. Openreach do not (and are not allowed to) sell direct to retail customers. They can only sell via SPs.
“Ofcom might for political and expediency purposes appoint BT as B-USO provider and define the services as a separate exercise once the BDUK funds and deferrals are exhausted.”
Ofcom have no legal power to force a BB USO on OpenReach. It would require primary legislation unless OR were to agree to it and whatever funding model was used. Bear in mind, that some ISPs are threatening legal action to oppose the current voluntary proposal due to the, rather modest, degree of cross-subsidy on the grounds it’s illegal state assistance. Imagine what their approach might be if a much larger cross-subsidy cost is included in Ofcom’s regulatory pricing for WLA products.
In any event, the Ofcom study on the USO is a consultation. It will be the government making the decision as some proposals have an impact on public finance.
I suspect the reality would be that a significant proportion of the OR voluntary USO schemes numbers would end up with FTTP anyway, but that the 10mbps threshold would make the number of premises manageable. I don’t think your idea is, at least as the current regulatory regime works.
Facts .right to order… subject to ‘reasonable demand’… The latest FoD provides a starting point to be developed as did the pre 2013 version. The existing PSTN USO provides another reference point.
The connection charges will need to be linked to the length of final drop, – probably a £100 per pole span.
I am suggesting the expectation is created in the current WLA conclusions with a formal change in the subsequent WLA review.
Steve, Fod was included in both OR briefing for B-USO and Ofcom included it in the modelling for B-USO, so the notion of FOD being SP only has to be a wafer thin definition and artificial in the extreme. Any group capable of taking a deposit from their neighbours could register, to which is added BDUK vouchers, a BT contribution and even a credit against the capital deferral. You want to converse on the basis on why it cannot happen as opposed how it can be made to happen given the resources available.
Reduce from 100Mbps to 24 or 30Mbps and re-do your numbers.
Steve, you make the case well. Ofcom could amend the product definition for WLA by embracing clauses defining ‘reasonable demand’ for direct fibre access. No primary or indeed secondary legislation needed.
@NGA
The new FTTPoD model does, potentially, provide some basis, but if sold directly to end customers it will require an SP. However, the FTTPoD pricing model doesn’t conform with a normal USO model which (subject to a threshold) is for a set price and can be ordered by single customers.
As far as demand aggregation might go, then there is already the community partnership scheme which OR already operate. Whilst the solutions offered do not, as far as I know, include aggregation using FTTPoD, there is that potential, although by the time you get to that point the costs are probably no different to a bespoke FTTP community partnership scheme. After all, it will technically be the same solution albeit normally for a larger number of properties and not focussed on individual PONs (which is largely what FTTPoD seems to look at). Note that the community partnership scheme is not considered a retail offering as individuals still need to sign up to particular ISPs.
I should also add that the exploitation of FTTPoD aggregation would also be undertaken by an enterprising SP. It might require the sign-up of a number of households on the same PON (or PONs) to cover the capital cost of the OR initial charges, but that could be recovered over contract periods, but probably with some sort of early termination charge. It might be messy to administer, but an SP which specialised in demand aggregation might be able to make it work and they would, as retail operators, be more able to deal with the customer facing issues.
I should add that OR are not allowed to include excess construction costs in the overall pricing envelope, so there should be no suggestion that they would earn profits on elements of the capital expenditure which were made by an SP or community partner.
Steve, There appears to be quite a difference between some initial Community Fibre Partnership quotes at £3k a premise and evidenced costs.
If the latest FOD is the route to a transparent capital contribution from BT of c£700 per FTTP premise plus the discipline of evidenced costs, then we are well on the way to defining ‘reasonable demand’ and providing a structure for absorbing the excesseses from phase 1-3.
NGa there will be a verity on costs on these as these bespoke , within the Openreach Engineering rules and policies and the premises in the community fibre scope is determined by the community and where the solution proposed is FTTP (which I understand the vast majority now are) that includes the final drop to enable the Connectorised block to be deployed with no excess construction charges) if say 1 or 2 premises require lead in (between the DP and the NTE in the Home) is No Duct, Buried cable or some carriage way duct that would massively impact those premises and therefore impact the overall average price per premise (this average is only the average of the total premises included in the bespoke ask) — curious to see community fibre which one you keep making reference to (as I assume your looking at a number outside of the actual context
community fibre partnership is the provision of infrastructure build to enable you to purchase / not purchase (your choice) of a fibre product from consuming service provider once the work Is undertaken — no service provider has any visibility of that infrastructure work being undertaken or what it oovers until is handed over and appears in the wholesale Network Checker at and Address level
@NGA
“There appears to be quite a difference between some initial Community Fibre Partnership quotes at £3k a premise and evidenced costs.”
What evidenced costs?
In any event, I would fundamentally disagree with your notion that OR allow £700 per customer. They manifestly are not, as it’s £700 per PON plus £50 per premises passed. Given a typical PON is going to be passing several properties, if the average number of properties passed by each PON is (say) 16, then that implies OR would value each property passed at £700 + £800 / 16, or £93.75 each. That doesn’t sound so different to the basis for FTTC cabinets. Just what take-up assumption is, I don’t know, but there is bound to be one.
Bear in mind that the incremental revenue for OR for any enabled line is limited to the price of the GEA-FTTP service, which is fairly modest for all but the higher speeds.
nb. FTTPoD does, of course, have a much higher first year rental cost (on the new scheme), but I assume later customers on the same PON will not be faced with that.
Fastman, it is a BT offer letter non-confidential..and pre-survey; but it includes a deposit of £2.5k to take further. My whinge is that there is no reason, none what so ever, why it could be change requested into the existing contracts.
Steve, while note 5 in the spreadsheet states £700 per PON, the supporting briefing NGA2007/17 FTTP on Demand Refreshed proposition references..• Deductions will be made on the build charge for:
– Each FTTP on Demand order in the PON build
The build charge deduction per PON will apply for each FTTP on Demand order
– Provides an opportunity for the build charge to be shared by multiple end customers.
Fastman, Will CFB be adopted to use the FoD product in your process? In standardising the BT contribution, then a volume forecast would allow the proposed WLA price control to rise. It also provides a vehicle to conduct change controls on BDUK contracts and absorbs some of the deferral.
Fastman, Connectorised Block v Splitter Box; what is the proportionate difference in cost, and consequential change in connection cost?
Does the connectorised block work for as few as 4 customer?
@Steve Jones: “FTTPoD does, of course, have a much higher first year rental cost (on the new scheme), but I assume later customers on the same PON will not be faced with that.”
The monthly cost of this upcoming FTTPoD offer is the same as native FTTP.
GNewton ‘Standard’ – does that mean £700 per premise in PON?
@ NGA – It seems that once again, you do not understand things like everyone else.
10 customers in the same area order FoD with the same ISP. Openreach designs and provides a single quotation to the ISP for the order. There is a single exemption of £750 for the PON and then £50 per premises. So in this case, the total exemption is £750 + £500 = £1,250 for the order to build the FoD network for those 10 customers.
@NGA for All: I was talking about the monthly line rental of this upcoming FTTPoD offer. As far as I understand it will be the same as for native FTTP from day one of the 12 months contract.
hhhhmm so it close to be a year old or at least 6 – 8 months old as no offers now carry survey charge so its quite historical — suggest you get them to speak to their county to see if county will contribute !!!!!
tHEmANSTAN – 30-60 Days of work does not reach £1.1bn
AndyH Thanks, now for that example of 10 customers, 5 customers place a order, what is the BT contribution for 5 orders and 5 passed in a PON?
all community fibre its bespoke and specific dependant on the ask (change the ask the solution / cost change)
NGa there will be a wide variety on costs on these as these bespoke , within the Openreach Engineering rules and policies and the premises in the community fibre scope is determined by the community and where the solution proposed is FTTP (which I understand the vast majority now are) that includes the final drop to enable the Connectorised block to be deployed with no excess construction charges) if say 1 or 2 premises require lead in (between the DP and the NTE in the Home) is No Duct, Buried cable or some carriage way duct that would massively impact those premises and therefore impact the overall average price per premise (this average is only the average of the total premises included in the bespoke ask) —
Fastman, understood, but there can be variations from £2 a metre to £10-£12, or £25-30 if your ducting, but some form of uniform capital contribution ought to be present.
@NGA – £2 to £12, ‘some form’…..’ought to be’. All a bit vague and imprecise to calculate anything.
Good job, now to bring it to the rest of us… Right? Maybe not.
Oddly enough, with enough scrutiny on how the BT Capital Deferral of £477m is converted back into coverage, then as long as your willing to wait the answer is likely to be yes.
50:50 is the real answer with the funds available.
Themanstan; 50:50? there is more to come back in from La investment account balances which need to be reported on. The overbuilding of 1m VM premises also needs to be accounted for properly. £477m excludes any BT capital contribution on top.
£130M is already spent.
Leaves £347M with BT contribution ~£500M, Gigaclear harder to reach cost is £2500 per property. So best case!
Which is 200,000 properties, which is a bit less than half the final 2%…
Please show me your always excellent accounting!
TheMANSTAN – Dude starting point was 95%. I am suggesting he should be encouraged.
£130m (UK wide) is committed rather fully spent. Some BT folk say £150m but the press release seems to be for £130m. You need to add the corresponding BT investment for the next set of premises.
The Pot for the final 5% includes the remaining £300m-£400m from BDUK- from £1.7bn.
The Capital Deferral of £327m or £347m plus a BT capital contribution for new premises.
LA investment account balances – not reported
Underspends reported by BDUK – £250m+
Adjustment for VM overbuild – estimate£80m needs to appear somewhere.
I am not sure how far all this will go, but the 98% is good and your suggesting more might be also possible, so thank you.
Spend what can be accounted for, not theoretical or unofficial figures. Also, why think only phase 2 when there are more phases in progress. You have a completely illogical way of approaching infrastructure build and cost accounts.
Committed is the same as spent as it is now contracted.
Underspend is already being reported as being reinvested in phase 3 & 4 extensions already… so stop trying spend it on something else.
Q2 2017 reported BDUK expenditure is ~£1.5BN, plus underspend accounts for the ~£1.7BN for Phases 1 and 2, where is this £300-400M from?
‘TheManstan – Gross state aid receipts from LA/BDUK accumulated as of q2 2017 was £1,041m not £1.5bn. BTplc statements should be reporting the accumulated amount but do not, but the quarterly numbers are available to be added together.
There is no complete reporting or reconciliation.
It is not appropriate to count contracted but monies received for work done, less the deferral.
There is still substantial elements to be audited including the capital account balances.
Then you are still spending money for which receipts are expected!
@NGA – How do you know there is not complete reporting? It does not have to be made public, like other LA contracts.
TheMan stan, another 60 days of billing does not take the total beyond £1.1bn.
Thanks for you clarity, I won’t ever need to question your accounting abilities again.
I’ll leave it to you to explain to Gigaclear why they won’t see their near £100M due from phase 2 contracts… because you’ve spent it on something else.
TheManstan – The underspends alone would be sufficient to support the Gigaclear contracts. As it stands there is no BT plan or offer to convert some £377m Capital Deferral into improved coverage. It is just resting in BT’s accounts.
Are you questioning the receipts recorded in BTPLc accounts? Are you questioning the rate of quarterly work?
BT’s current contracted total versus gross billing would be informative. What is your take?
No need to try to explain further, you are spending committed funds from a separate pot to try and pay something else before it is even released from that commitment.
Like I said, I no longer have to question your accounting methods, you have made them patently clear.
TheManstan, In the week that Clive Selley, was quoted as saying OR had not stepped forward sufficiently, I think you should not sledge but inform.
You are “spending” phase 2 cash, which is committed and substantial amount is nothing to do with BT but relates to work by other suppliers (Gigaclear >£65M contracted since March this year so no chance of any significant receipts)… then you clainm that they can use underspend to pay the these other providers… but LAs are already spending underspend on Phase 3 and 4 work… and the way you are proposing would mean using money from a variety of LAs out of their area of responsibility, which can’t happen.
These “available” funds you talk about simply don’t exist in the way you imagine…
TheManStan, Are you saying the Capital Deferral owed (£477m -£130m re-cycled in Phase 3/4) cannot be converted into coverage?
Are saying the BT capital contribution cannot be reconciled with the assumed BT capital needed to underwrite the price control?
Are you saying the BT capital contribution to overbuild 1m Virginmedia premises cannot be scrutinised or verified?
@NGA – every time you post something there is a reply that you are wrong on the financial and/or technical details. Can you please explain why, what is the source of your information? Others seem to be closer to the industry.
See above. I am about £700m less wrong and counting. The latter is folly of course, if customers cannot order FTTP where it is needed after £1.7bn of public funding. The science park in Cambridge is an example – 13 subsidised cabinets and no immediate capacity to order native FTTP is poor.
The fact that £327m of the £477m Capital Deferral is not being readily re-cycled is a sign of failure.
You seem to be anti-Openreach, anti-UK-rural networking yet represent BT.
The possibilities of these FoD changes looks encouraging and can be built upon. £700 per PON or £700 per premise in a PON is a valid question given the supporting briefing.
Such a predictable investment level would permit the proposed Ofcom price control to rise. This would be a good thing for Openreach, BT Group and would be supported by industry.
@ NGA
What is this £700m all about?
Where do you get the £1.7bn in public funding from? I make it £1.593bn according to the latest BDUK report (not all of which went to BT’s deployment).
“The possibilities of these FoD changes looks encouraging and can be built upon. ” You again seem to allude there is some product change here, when there is only a price change. There is an exemption of £700 per PON – this is not the total Openreach capital contribution and this is not a discount per property.
FoD is a niche commercial product. It is not designed for mass deployment and I very much doubt that LAs will suddenly be asking for their deferred capital to be invested in FoD.
AndyH – .’this is not the total Openreach capital contribution and this is not a discount per property’.. So you can say what it is not, can you explain what it is per property?
For the monies see response to TheManStan.
Why would LA’s not use FOD for this purpose? SP will be expecting to use BDUK vouchers!
AndyH – If LA do not use for Broadband, half money is returned to Treasury, which is embarrassing given the money is to deliver fibre as deep as possible in rural.
OR committed to do more fibre, so why create a niche product when so many gaps to fill? Why run a consultation on more fibre, while creating a niche service where the gaps in service are so great.
@ NGA – It’s a commercial product. Openreach/BT do not have to and will not state what their capital contribution is, however I am confident to say it’s more than £750 per PON and £50 per premises passed.
FoD is a niche product – a bespoke network is created for an individual order. If LAs want to expand their superfast coverage with FTTP, they build native GEA-FTTP networks.
The new connection vouchers (being trialled at the moment) are part of the National Productivity Investment Fund, not the deferred capital that BT holds or returns to LAs.
@NGA – I represent nobody other than myself trying to understand what it going on and wanting accurate information.
AndyH – it is not a bespoke product when it is exactly the same design as native-FTTP-GPON and customers can order a standard BT retail service within 12 months or 36 months.
It should not be a bespoke product as it being used in briefings on how BT deliver the B-USO.
The vouchers are just another form of intervention. You hand the Capital Deferral back to Government and they convert it to a voucher as an example. The positioning is fundamentally weak as it is held together by semantics and a weird notion of commercial confidentiality which is no more than an abuse of market power.
Facts; Are you currently employed by any part of BT? If so why do you need to use public forums to acquire accurate information? Is using company time to acquire information and sledge others an adequate means of delivering value for money for whoever you are working for? If you are BT, you manner is not supportive of creating long term economic value for BT shareholders. It is consistent with supporting a short term Gambit at the expense of Openreach engineers and its contractors and the UK rural economy.
If ex-Ministers thought BT capital was paid in his representations to the CMS Select Committee Inquiry into Broadband in 2015-16, while a newer Minister had to correct via a WPQ such a representation, I think it is reasonable to assume the reporting is not what it might be.
andyH, I forgot to say thank you for clarifying the position. I may disagree with the positioning and I think it will change again, but I am grateful for your willingness to respond in the manner you do and I am sure it appreciated by others.
@TheFacts: So what exactly are you so desperately trying to understand here on these public forums? What exactly is it that BT won’t tell you? Have you ever tried some simple enquiries under the Freedom of Information Act?
I’ve always said that BT has never performed or provided adequate strategic view/planning for infrastructure build.
Stop deluding people with your mickey mouse accounting practises… they are just like a politicians, “spending” spent money….
TheManstand – If BT’s planning is not strategic, how would you characterise it? Opportunistic? The planners must have rules to which they work. The rules have unit costs associated with them. The units costs when added together provide a budget.
£1,041m receipts is not Mickey Mouse. £477m Capital Deferral is not Mickey Mouse. No accounting needed. I just need to read the numbers in BT’s accounts.
NGA – I’m sure YOU would like to see more detail, as far as I am aware not one of the individual project accountants has raised significant issues, neither has BT’s accountants, especially taking into account the need for Sarbanes-Oxley compliance and shortly Openreach’s accountants.
I assume you will, however, be pouring over the Gigaclwar and Airwave accounts demanding similar visibility?