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Gigaclear CEO Mike Surrey on Building Full Fibre Beyond England

Saturday, August 25th, 2018 (12:01 am) - Score 3,217
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The recently appointed Interim CEO of Oxfordshire-based UK ISP Gigaclear, Mike Surrey, has told ISPreview that they’re ready to grow their Gigabit capable “full fibre” (FTTP/H) rural broadband network beyond England and believe that “market forces driven by competition” will deliver the best outcome.

Anybody familiar with Gigaclear will know that the provider has had quite an eventful couple of years, which recently culminated in Infracapital (M&G Investment Management) acquiring 80% of the business as part of a £270m cash deal (here) and this was later followed by the departure of long-time company CEO and Founder, Matthew Hare (here).

The Infracapital deal means that the ISP has now raised £184m of equity from its shareholders and they have a commitment for a further £150m from Infracapital and Railpen. All of this will be crucial in helping to deliver their rollout plan, which aims to cover 350,000 premises by the end of 2021 (currently at 65,000 premises passed).

Much of the current work stems from their state aid supported contract wins as part of the Government’s wider Broadband Delivery UK programme, which until now has focused on reaching rural parts of 22 counties across England. However Gigaclear’s interim CEO, Mike Surrey, is “confident that we now have the delivery methods and processes to allow us to grow reliably outside of our ‘home’ territory.”

Indeed the ISP has already been linked with a bid on Scotland’s future £600m R100 project (here), which aspires to make “superfast broadband” (30Mbps+) available to 100% of the country by the end of 2021 (March 2022 as a financial year). Similarly we wouldn’t be surprised to see Gigaclear scoop up more contracts in other parts of England and possibly also Wales.

Suffice to say that now is as good a time as any to ask Mike Surrey about Gigaclear’s opinion on the current broadband market and what plans they have for the future.

The Interview

1. Over the past year a multitude of providers have announced plans to significantly invest in major expansions of “full fibre” (FTTH/P) ultrafast broadband infrastructure, which have been partly fuelled by Ofcom’s changes to regulation (e.g. easier access to Openreach’s cable ducts and a revised electronic comms code) and the Government’s support via various funds, as well as a 5 year business rates holiday.

Meanwhile the government has also launched a new consultation, which seeks to understand what kind of future investment and support may be required to help boost FTTP/H and 5G Mobile services. In your opinion, what more must the Government and Ofcom do to further improve the coverage of such services?

ANSWER:

There are around 30 million homes and businesses in the UK. Of these, around 1 million currently have access to full fibre. Gigaclear believes that almost every home and business will need full fibre infrastructure in the future. A build program of this size, to encompass another 29 million properties, will need a regulatory environment that is stable to attract the investment and appear friendly to new linear construction. Whilst Ofcom has been able to influence Openreach to design a better duct and pole sharing model, it still stifles long term investment due to the restrictions on the contracts available.

2. With so many ISPs planning to deploy FTTH/P connectivity into urban areas, the prospect of a significant overbuild will rise. In some areas we might potentially see several FTTH/P providers, which is good for consumer choice but might not improve overall coverage and may frustrate locals if their streets are being dug up multiple times by different operators.

What approach do you think should be taken to this or is it more a matter for natural competition and potentially even future market consolidation to sort out?

ANSWER:

We believe that market forces driven by competition rather than market organisation will deliver a better, if messier, outcome. Some properties will end up having a choice of two or three network infrastructures and some of these are likely to be delivered through combined construction programmes.

3. Gigaclear has successfully won a number of major state aid (Broadband Delivery UK) supported FTTP rollout projects between 2016 and 2018, which should significantly extend the reach of your “full fibre” network over the next few years.

Are you working to win any similar contracts this year and can you tell us anything about the counties or even countries that you have a strong interest in targeting for the future?

ANSWER:

Gigaclear looks at all BDUK opportunities and bids for those where we believe we can deliver a brilliant solution, offering long term returns that are attractive to our shareholders. Because the bidding processes are competitive, we do not comment on specific projects. Although of course you will know that Gigaclear has been announced as shortlisted for the R100 program in Scotland.

4. In keeping with the above, we note that Gigaclear are bidding on the Scotland R100 contract and wondered why it’s taken so long to start seriously considering a move outside of England. What challenges or barriers does Gigaclear face in potentially moving so far away from its base?

ANSWER:

Gigaclear has a regional delivery organisation which manages all our county and regional projects. As we move further from our HQ in Abingdon, the lines of communication are stretched. So, at some point we will need to open regional offices and duplicate some functions in each of them.

Our biggest challenge is building the team and structure to allow us to infiltrate more of rural Britain at scale.

It all takes time and we are keen to make sure we deliver. Inevitably, we do experience hiccups at times, which need to be fixed. However, we are confident that we now have the delivery methods and processes to allow us to grow reliably outside of our ‘home’ territory.

5. The Government’s new Telecoms Infrastructure Review is said to be mulling the controversial old idea of adopting regional franchises, which it’s been claimed could be used to help boost the coverage of “full fibre” broadband, particularly in rural areas.

Under this idea densely populated towns and cities, where the commercial model is easier to make, would be bundled together with swathes of less profitable countryside.

The idea acknowledges that there could be “major hurdles”, such as around the risk of creating new local monopolies, as well as the unclear impact on existing networks (including at wholesale) and the risk of creating a more confusing market for consumers. What are your thoughts on this option?

NOTE: Since posing this question the Government’s review has been published, which largely rules out a regional franchise approach (details).

ANSWER:

This is looking at the age-old question of how to subsidise the non-commercial parts of the build. Fundamentally, you must give a monopoly that allows the monopolist to cross-subsidise the more expensive areas with the less expensive ones. Or you (ultimately taxpayers) provide subsidy directly. Either *can* work.

Continued on page 2..

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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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40 Responses
  1. A_Builder

    This is good work for rural communities and shows a costs model where rural and semi rural FTTP can work commercially.

    All subsidised broadband should be full fibre. The historical BDUCK nonsense of seeing copper wires upgraded over long distances to get ADSL working better was sickening. For the same effort of stringing cable on poles fibre could have been put on the same poles as an overlay.

    I’m sure an OR apologise willl pop up saying poles needed replacing etc. That would be true of either pathway. It is/was not a differentiator.

    Anyway Giga (and a lot of others) will be making many people happy with decent connections at sensible prices.

    And the nice thing is that hay have committed funds to do a lot of this form serious investors.

    • Croft

      “The historical BDUCK nonsense of seeing copper wires upgraded over long distances to get ADSL working better was sickening. For the same effort of stringing cable on poles fibre could have been put on the same poles as an overlay.”

      That’s not always true. Depending on what cables you are running you can need to renew poles.If they simultaneously converted to VoIP you might get away with it but running copper/fib on poles can push them over their limits.

    • Fastman

      All subsidised broadband should be full fibre. The historical BDUCK nonsense of seeing copper wires upgraded over long distances to get ADSL working better was sickening. For the same effort of stringing cable on poles fibre could have been put on the same poles as an overlay.

      BDUK has nothing to d o do with ADSL, . There are challenges around poles which are not easy to overcome !!!!!! ie whats the state of that pole, how long are the current spans, and also what current on it — but let not facts and reality get in the way

    • A_Builder

      @ Croft
      @ Fastman

      You are right: I mistyped over my cappuccino.

      Semantics apart there was, historically, some farcical upgrading of copper wire to improve BB performance.

      I do accept that there are a few occasions where loading might become an issue on poles. But other national ISP have produced mixed copper/fibre bundles. BT did until recently own their very own cable making firm.

      Fibre bundles weigh a lot less than multi pair copper, which is inevitably, very heavy. The tensile elements in the fibre bundles can be Kevlar or the like which has very low weight and as the yarn form is quite cheap.

  2. Simon

    Bugger beyond England – cover England first!

    • A_Builder

      @Simon

      This is commercial. They will go where they see the best profits.

      And this is great as they can try a number of different models and debunk the it_doesn’t_work/it_is_too_expensive spiel on each one.

    • AdamWales

      Yes, because England is the be all and end all. There are 3 other countries to think about also.

    • CarlT

      They’re a private business not a public sector one. Whether they deploy to a single nation, county or even village is entirely at their discretion.

      Wales, etc, are more than welcome to engage them in public sector procurements. Apart from BDUK agreements their focus is very specific. There are many English counties, including my own, they have no plans to touch.

    • AdamWales

      I agree with you Carl. Didn’t agree with his comment is all. They are a business after all and they will go where the money is.

  3. Graham Long

    Let’s hope the ASA Judicial Review gives Gigaclear, Hyperoptic, City Fibre, B4RN a level playing field to compete on with those who peddle “fake fibre” forced being to tell their customers that they only give them copper. May the march of the full fibre providers continue full pace; there are many more customers waiting for you!

    • Croft

      Common sense says they should win but this is JR and its a high bar to win.

    • TheFacts

      @GL – you missed Openreach FTTP off your list.

    • GNewton

      @TheFacts: “you missed Openreach FTTP off your list.”

      How much is BT paying you to post here? If not paid by it, why do you keep twisting forum threads in favor of this company?

      The fact is BT is the one of biggest promoter of false advertising, calling VDSL “fibre broadband” when it isn’t.

    • wireless pacman

      As I recall, Graham, it wasn’t BT that started to peddle this nonsense but Virgin. BT complained to the ASA but lost and so decided might as well join in.

    • un4h731x0rp3r0m

      “As I recall, Graham, it wasn’t BT that started to peddle this nonsense but Virgin. BT complained to the ASA but lost and so decided might as well join in.”

      Nothing like accusing others of what you feel is a crime and then committing it yourself. Idiocy at its finest.

      Perhaps BT could start stabbing people randomly rather than metaphorically killing them with multiple price rises year on year… After all OJ Simpson (allegedly) did that and got away with it so if someone else does wrong that surely means its fine for BT to follow, i guess… right??? :-\

    • TheFacts

      Just simply pointing out TBB says ‘Full Fibre via its GEA-FTTP services is appearing. Total premise count running at 575,000 premises’.
      Let’s understand the story from all suppliers, big or small.

    • Gadget

      actually it appears that Sky and Talktalk were the ones to take the original complaint to the ASA – https://www.thinkbroadband.com/news/3391-asa-rules-on-virgin-fibre-optic-broadband-claims

    • un4h731x0rp3r0m

      Who originally complained or complained first about VM is irrelevant. If ANY organisation including BT (which have also previously complained) have an issue with the term “fibre” being used to describe a product which is partly copper based then they should not be calling their own crap “fibre” if it is also partly copper based.

      It defies all reason and logic to accuse someone of something you deem to be bad and then pull the same stunt yourself. Not only that but then for the bulk of your customer based not even be able to deliver anything near to the speed of the competitor you whined like a little beehatch about.

      Its like dumb companies that complain about Appl or Samsung and then as good as clone phones from those manufacturers.

      Pure 100% idiocy.

    • Meadmodj

      This should correct itself. As OR FTTP grows the ISPs will need to devise terminology to differentiate the FTTP products from the legacy FTTC products.

      As an aside Hyperoptic are on the list. I thought they were using FTTB and Cat6 cabling to the dewelling in some instances. If so what is that going to be called?

      Perhaps Ofcom should lead with a clear ranking but the use of the word Fibre is correct in most broadband definitions.

      Category A: Fibre to your home/dwelling FTTH
      Category B1: Fibre to your building then Data Cable to your dwelling FTTB1
      Category B2: Fibre to your building then TV cable to your dwelling FTTB2
      Category B3: Fibre to your building then Telephone Cable to your dwelling FTTB3
      Category C1: Fibre to your street then Data Cable to your dwelling FTTdp1
      Category C2: Fibre to your street then WIFI to your dwelling FTTdp2
      Category C3: Fibre to your street then TV cable to your dwelling FTTdp3
      Category C4: Fibre to your street then Telephone Cable to your dwelling FTTdp4
      Category D: Fibre to the cabinet FTTC then telephone cable to your dwelling FTTC
      Category E: Fibre to the exchange FTTE then telephone cable to your dwelling ADSL

      Note no use of FTTP as it can mean different things.

      Would categorisation help. I don’t think so for general consumers. Best probably to keep to speed and eventually Full Fibre to the dwelling will win naturally by market forces.

    • Joe

      The simplest is its fibre if it reaches your building as fibre; if it doesn’t its not. (cat6 etc in your own house or shared flats/appartments is your problem not the ISP/Supplier.)

    • Meadmodj

      @Joe. Currently people would be grateful for fibre to their premises but going forward when this is common place the method of connection to each dwelling will become as important. The issue raised here was clear advertising and my view is that services should be described correctly whether now or in the future.

    • un4h731x0rp3r0m

      “As an aside Hyperoptic are on the list. I thought they were using FTTB and Cat6 cabling to the dewelling in some instances. If so what is that going to be called?”

      FTTP and FTTB are for all purposes the same for the consumer. A fibre cable enters your building. (some *predictable*) people will try to argue this.

      What type of cabling you/is used within your home has no bearing on what type of cabling transmits the broadband to your home.

      If cabling you use in your home has a bearing on what a product is called then FTTP from anyone including BT (for the same predicables reading) can not be called FTTP as the wire between computer and modem, router or switch is likely to be CAT5/6 (IE copper) also.

      The Fibre to the home council also believe the same, they state…
      “We only promote Fibre to the Home (FTTH) and Fibre to the Building (FTTB), because we believe that only these solutions offer the bandwidth and symmetry necessary to allow the development of services and applications that make a difference to the way we live and work.”

      I agree with them entirely, those and only those products should be allowed to call theirself fibre. It does not need complicating anymore than that.

      VM and their product range which uses coax rather than full Fibre… NO to that being called “Fibre”
      BT and others with FTTC product ranges… NO to that being called “fibre” also.

      The only reason nothing has been done until now is cos government and big business (BT, VM etc, etc) like to exaggerate what they deliver to people.

    • Meadmodj

      @un4h731x0rp3r0m
      FTTH and FTTB are not the same physically, performance or reliability. Altnets also need to advertise accurately going forward.
      Current FTTC description should have been resolved long ago but wasn’t but what I am stating here is the principle.

    • TheFacts

      @Mm – do you some figures on the performance and reliability of FTTB v. FTTH?

    • Meadmodj

      @TheFacts
      MTBF would be difficult without knowing exactly how the provider is approaching it. I am simply assuming that FTTB infers some form of communal powered kit in the network and as such would therefore be less reliable that FTTH where there should be nothing between the OTL and the individual OTNs in each dwelling just fibre and optical splitters. More likely than MTBF will be the resilience of the kit from neglect or damage.
      Fibre provides a better upgrade path that Cat 6 doesn’t as faster optical kit becomes available. I know 1 Gbps is dream for most now but optical technology will continue to develop.
      As I said it’s the principle. There is a difference between FTTC and FTTP but there are also differences in the way that is provided. If some one is redefining ASA rules lets have the truth in all advertising.

    • GNewton

      @TheFacts: “Let’s understand the story from all suppliers, big or small.”

      The story is about Gigaclear. Your desire to advertise BT is admirable, but inappropriate in the context of false advertising. The fact is, BT (along with VM) is majorly misleading customers with false ‘fibre broadband’ advertising.

    • A_Builder

      @Meadmodj

      I don’t see FTTB, where CAT6/7e cable is being used as misleading.

      You responded to the thread over Gfast a couple of weeks back encouraging a mix of technology. This is a rational use of technology in that it meets and exceeds foreseeable growth.

      Yes, an all passive infrastructure is better in the long run as it is future proof. But Cat6/7e is a good viable solution and is far better than using Gfast in the basement as it is easy to upgrade the router to increase throughput from say 1G to 10Gb/s.

      Installation at volume of pure fibre may be an issue, for the smaller Alt Nets, given the sheer volume of fibre terminations required across a large estate of flats. And there is where data cable to the flat may well have a role.

    • un4h731x0rp3r0m

      “FTTH and FTTB are not the same physically, performance or reliability. Altnets also need to advertise accurately going forward.”

      Firstly i said FTTP/FTTB “for all purposes the same for the consumer” and it is.
      Physically a cable enters your building. Performance wise both are capable of 1Gbps symmetrical As for reliability in many cases that will be down to the rest of the suppliers network or how things are deployed, rather than anything to do with the cable which runs into a persons home.

      Altnets are not misadvertising Gigaclear even have long winded explanations and diagrams on their site on how their product works.

      ” I am simply assuming that FTTB infers some form of communal powered kit in the network and as such would therefore be less reliable that FTTH…”

      If you have a network where a fibre cable goes into a building then it is a “fibre” service. How it is powered, what cable is used to connected consumer gear and more INSIDE the building has nothing to do with what product is being supplied.

      If you want to get that pedantic and have definitions based on equipment in the building and how its powered things are going to get stupid. Are you going to have another classification for networks that use alternative energy (like solar) to power or partly power them?

      Are you going to have different definitions for every FTTP/H/B product which uses different manufacturers ONT gear (as just one of a million examples of other equipment used in a network) because one manufacturer will have a better reputation than another for reliability of their equipment? What about the consumer end modem/router device, is that not also going to have a bearing on reliability? Going down that rabbit hole of definition is daft and would make things even more confusing than things are now.

      Nobody except a OCD nerd is going to care how a fibre which comes into their home. People care if their connection is fibre or not fibre. Not how wide the hole was to lay the fibre cable, or what make/manufacturer/reliability/other equipment in the network is used/choosen.

      FTTH/FTTB/FTTP have never been defined in ways like that and never should.

    • Meadmodj

      @A_Builder. Yes I support all technologies to distribute whether fibre, cat 6 or dsl. My badly formed point is purely how FTTB products are compared with FTTH in relation to advertising. Particularly as FTTP appears to be the most common term in the UK. My view is that if they all used the term “full fibre” that may be as contentious in future as the current FTTC debate.

    • un4h731x0rp3r0m

      “…My view is that if they all used the term “full fibre” that may be as contentious in future as the current FTTC debate.”

      Why would it be? FTTB/H/P a fibre cable enters the premises, FTTC it does not.

  4. Tim

    Gigaclear please expand into rural East Kent! We’ve been forgotten buy all other providers. Still stuck on 4Mbps ☹️

    • Liegeois

      I second this, looks like the ones who are building in Kent prefer West side over East, I wonder why.

  5. hmm

    west kent more money east kent less money and business

    • Tim

      I really don’t understand why Canterbury, Kent’s only City is ignored by all. There is NO Virgin Media, NO Hyperoptic, NO Gigaclear. There are no alternatives fibre networks in most of East Kent! Virgin has done a small amount of expansion in Thanet but that’s about it and is restricted to urban areas.

      East Kent is always overlooked. Other than Scotland we have the worse mobile phone coverage. Canterbury is well known to have NO indoor city centre mobile coverage! We need fibre in Canterbury to help boost the possibility of investment in mobile infrastructure like 4G micro cells on street lights.

  6. hmm

    west kent more money east kent less money and business

  7. Ogilvie Jackson

    Let’s hope we get the Scottish Governments decision soon on R100.
    This £600m.project needs a bidder who will reach out to remote areas with fibre to the home. In most of these areas the pole infrastructure has been upgraded and will support aerial fibre.
    LET’S HOPE THAT BIDDER IS Gigaclear.

  8. SuperFast Dream

    It would be great if Gigaclear could blow some fibre over to rural NI 🙂

  9. TheMatt

    Hows about not focussing on London and multiple occupancy buildings.

    It’s alright to talk about expanding outside the country… but you can’t offer service to 90% of the country you’re in now.
    Please, get fibre to people and stop giving it to the chosen few ? howsaboutthat?

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