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ISP Gigaclear and RSN Call on Ofcom to Consider Full Fibre in its USO

Tuesday, September 18th, 2018 (2:39 pm) - Score 1,355
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The Rural Services Network and UK ISP Gigaclear have today joined others by calling on Ofcom to ensure that their forthcoming 10Mbps Universal Service Obligation (USO) for broadband will reflect the national plan for “full fibre” (FTTP) coverage, which the government hopes could reach universal coverage by 2033.

At present the USO proposes to give people the “legal right” to “request” a broadband download speed of at least 10Mbps (1Mbps upload) from a supporting ISP. The new measure is due to be enforced from 2020 (see the latest update) and will focus on those in the final 1-2% of the UK, which aren’t expected to benefit from existing “superfast broadband” (30Mbps+) deployments (c.600,000 premises).

Meanwhile a growing number of organisations and alternative network (altnet) providers have been calling for the USO to be modified, not least in order to take account of the Government’s new aspiration to cover the whole of the United Kingdom in Gigabit capable “full fibre” (FTTP/B) broadband networks by 2033 (details).

As part of their 2033 proposal, the Government estimated that pushing full fibre out to reach the final 10% of areas (i.e. the hardest to reach) was likely to require “additional funding” (state aid) of around £3bn to £5bn in order to support commercial investment.

However Gigaclear, which says they “would not be able to come forward” as a USO supplier under Ofcom’s proposed design, has today called on the regulator to “reflect on how the USO will interact with the delivery of full fibre” in their design for the new obligation. In particular both they and the RSN seek the following two changes.

Gigaclear / RSN Proposed USO Changes

1. Maximise the opportunity for the USO to support the delivery of ‘future-proofed’ connectivity where appropriate, as opposed to funding solutions that will quickly become obsolete as consumer bandwidth demands increase.

To do this, we propose that Ofcom compel Universal Service Providers delivering the USO to use existing and accessible full fibre networks that lie within a reasonable distance of the premises requesting a connection through the USO. Whilst this may imply some additional up-front cost, it will deliver a long-term solution compatible with the FTIR.

2. Mandate USPs to consider the impact on planned full fibre network rollout when providing universal service connections.

If premises are served by the USO, they may become ineligible for state aid programmes providing full fibre connectivity. To rectify this, premises could be exempt from requesting a USO connection when there are clear plans in place to reach that locality with full fibre through a state aid programme.

Alternatively, USPs could be compelled to explore using the network of the full fibre provider who is due to serve that premises, rather than rolling out its own infrastructure. This would then avoid duplicating costs and resources required to connect this premises, thereby maximising full fibre coverage.”

On top of that the RSN said they also consider that 10Mbps is “likely to prove too low” a USO limit by the time it is implemented, not least because Ofcom will probably “want to leave it unchanged for a few years after 2020 to let the USO bed down.” As such the group believes that the Government should ask Ofcom to review the limit prior to its implementation, taking account of the growth in demand for bandwidth.

RSN Statement

In short, the RSN welcomes the implementation of the USO, but given the compelling ambitions of the [Future Telecoms Infrastructure Review] Ofcom should explore how it can deliver full fibre networks wherever possible. If the above proposals were to be adopted the RSN believes that more rural homes and businesses would benefit more quickly from access to full fibre.

Aligning the USO with the new full fibre aspiration makes a lot of sense, although there would be some complex challenges to overcome with the above ideas and it’s worth remembering that the USO is only intended as a legal backstop; this merely designates the minimum level of service delivery expected and not the maximum. Any significant changes to this policy may risk delaying its implementation beyond 2020.

Meanwhile the idea of compelling USPs to “use existing and accessible full fibre networks that lie within a reasonable distance of the premises requesting a connection” is a statement that could mask some potential problems. For example, the trouble with balancing the often significant differences that exist in wholesale access, service and pricing between networks.

However the proposal suggested for no.2 might be easier to implement, if only because the current USO already includes a section that suggests “only premises who do not have a connection which meets the USO specification, or are unlikely to be connected under publicly funded procurements which meet the minimum specification, will be eligible to be connected.”

Finally, setting the USO speed too high too soon might also run the risk of distorting the competitive market, particularly for many smaller alternative network providers. The existing USO policy does include a speed review clause, although this is rather strict and indicates that we probably won’t see the USO speed being lifted for quite a few years.

The 2033 plan is currently little more than an unfunded aspiration, at least until some real money is set aside to fuel it and a procurement framework designed, ideally alongside solid targets (similar to the Broadband Delivery UK programme) and cross-party support. Otherwise the 2033 date falls more into the realm of wishful thinking and could easily be changed or even abandoned by a future government.

At the end of the day 2033 is still 15 years away and currently lacks a solid foundation. We may also need to wait until various other schemes, such as the new contracts for Wales, Scotland and N.Ireland, pan out before knowing how best to approach setting a faster USO or funding FTTP for 2033.

In the meantime many of those living in disadvantaged areas probably don’t want to be told that they might have to wait even longer.

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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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21 Responses
  1. Avatar A_Builder

    When I first read this my thoughts were with flying pigs.

    On reflection I don’t think this is as silly as it sounds.

    Ultimately the hardest to reach will be better served by fibre than by any further copper bodging and upgrades. Yes, it will take longer but there has in the last 12 months been a sea change in view by all of the ISP’s that copper is no longer investable.

    In the mix will have to be some mirowave links etc and there does need to be some tower sharing with the mobile operators or the mobile operators need to start selling microwave links [and relays] in rural areas. However, that sill needs plenty of fibre to the tower…..

    Given the aspiration to pepper the place with 4G towers, piggybacking off of that to provide much better connections is a real possibility.

    And at the same time get more local backhaul to the valiant and increasingly successful ISP’s that are managing to connect up increasingly large numbers of people to really good fast prosumer networks.

    • Avatar Joe M

      4G towers require symmetric gbit fiber close by to each tower modem – so may as well roll out fiber everywhere instead. Upcoming 5G towers 10gbit every 300m. May as well roll of full fiber everywhere with 3456 core 1.5 inch fiber optic cables along all major roads to avoid double dig.

  2. Avatar Meadmodj

    Surely the objective is to provide the minimum ASAP. Whilst FTTP first should be the strategy other technology approaches should not be discounted (Wi-Fi mobile dsl) if that is the most expedient method in 2020/21. The USO cost is capped and we need to ensure some are not excluded because FTTP is uneconomical until part of a wider plan.

    As for utilising other Fibre networks perhaps they should offer wholesale products that the ISPs that showed an interest can utilise. But if they are so interested why didn’t they on the list of USO interested parties?

    • Avatar EndlessWaves

      The objective is to bring everyone up to the same level as quickly as possible.

      The USO is a stop gap measure to ensure people can get a poor connection rather than an unusable one, but if it can contribute to making connections on par with the rest of the country available more quickly then it should do so.

      Better another six months or a year on 2Mbps than 15 years on 10Mbps.

    • Avatar Meadmodj

      But that’s the issue. Will it be 6 months or a year?. The USO only applies if there are no other initiatives or plans (ISP investment rollouts, BDUK etc) and is only a registration request no guarantees. So it could be 10 or more years until the 2033 target looms for the government.
      I am not affected but if I was in an isolated homestead (not necessarily rural) I would rather the USO was provided earlier knowing that in many cases higher speed options may be provided whilst achieving the USO minimum.

  3. Avatar Tim

    FTTH needs to be installed where it makes sense. There are plenty of locations where patching up the copper just isn’t going to be a good investment.

    My mum’s house is an example of this. The Fibre runs past to feed 3 more cabinets down the road. The T-Node is under 500 meters away. If a new FTTC cabinet was installed at the T-Node some properties would still be too far for 30+ Mbps yet stringing up fibre cables on existing poles is not that costly, probably cheaper than a FTTC cabinet and power connection.

    If Openreach are not going to do FTTH then I expect another provider will because FTTH is the right approach for the future. Then Openreach will have lost all customers from an area, ok just ~80 customers but repeat that across the country and suddenly it’s not looking good for Openreach.

    • Avatar Meadmodj

      Yes FTTH/P should be the strategy. I am certainly not advocating more FTTC. Hopefully where there are numbers of USO applicants that are not subject to BDUK or ISP investment the cumulative USO subsidy may be enough to provide FTTH. However there will still be isolated clusters or individual homes/businesses where the subsidy will be insufficient for FTTH/P and hence why other solutions should not be excluded.

    • Avatar Fastman

      interesting so this is the same Gigaclear that ISP review reported recently that they decided not t become a provider under the USO and has recently reduced its entry FTTP product to the minimum superfast (30 m/bps)

    • Avatar gerarda

      @fastman

      Hardly surprising that Gigaclear decided not to become a USO provider. Its a bit like Ferrari being asked to provide a univeral bus service

    • Avatar Gadget

      Except they are also lobbying the Bus Regulator to make all buses Ferraris…….

    • Avatar gerarda

      Which would certainly improve public transport

    • Avatar un4h731x0rp3r0m

      ^^^ LOL you baited him into that 🙂

  4. Avatar NGA for all

    The BT response which is about the only one Ofcom can work with, focuses narrowly on the exam question around 2020, hence the focus on FWA (4g antenna). This leaves most of the now £600m of Capital Deferral in limbo as much of stuck until 2023.

    At no point has Ofcom or BT outlined the impact of a 2023 start date utilising these funds. Ofcom have not asked the question and BT has not seen fit to offer a scenario.

    • Avatar Meadmodj

      I am sure the Government and BT have discussed it’s just we are not party to it. I am assuming 2020 was chosen on purpose to allow for BDUK/LA final phases to be resolved and perhaps further BT Deferred Capital to be released “early”. BT may have benefited but I don’t think its doing them any good either now as the figure increases.

    • Avatar Andrew Ferguson

      Repetition is boring, but NGA might get the message in the end.

      Local authorities have a big say on what happens to the deferred money. If BT went ahead and just spent it then councils would probably not be able to balance books in 2020 to 2023 window

    • Avatar Nga for all

      USO SET in November 2015, before CD was understood. This is Ofcom acting selectively independent.
      Boring indeed, except for those excluded.

  5. Avatar A_Builder

    Perfectly sensible for the recycled BDUCK funding to be spent on this provided it is on the fibre element of it.

    And provided it is also open to Alt Nets to bid for it in smaller parcels. As the Alt Nets do seem to be able to do commercial rural FTTP on a commercial basis in a surprising number of locations.

    There really are three separate closee-but-no-cigar scenarios here that are being conflated here:-
    a) where the local drop deployment is viable but there is no fibre spine anywhere near so the aggregated costs are too high to make it commercially viable
    b) where the local drop deployment doesn’t quite work but there is fibre spine nearby
    c) where there is no fibre spine and drop deployment is not commercially viable.

    Situation (a) and on extending the fibre spine out for other Alt Nets to utilise where the issue is not the local deployment but the connectivity to backhaul.

    Situation (b) requires a smallish subsidy needed via BDUCK recycled funds to make it viable and this is where the resources should be focussed.

    Situation (c) requires other options such as microwave links.

    • Avatar Nga for all

      The issue is timing. There is so much owed and yet to be completed, it cannot be spent before 2020 or 2023.

    • Avatar A_Builder

      @Nga for all

      Realistically 2020 is not that far away by the time a network is planned and deployed.

      Most businesses would take an LA IOU as good in their books and would be able to finance against it.

      I should have said that option (c) can also solved with B4RN type solution(s) with maybe intervention to provide the backhaul.

  6. Avatar chris conder

    and the superfarce rocks on.

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