Government Prep Another £250m+ for UK Full Fibre Broadband

The UK Government’s Chancellor, Philip Hammond, is reported to be planning another investment boost of at least £250 million to help further extend the availability of Gigabit capable “full fibre” broadband (FTTP / FTTH) links across more of the country. An announcement is expected on Monday as part of the Autumn Budget.

According to the Telegraph, the extra investment will be targeted toward delivering fibre optic lines to connect more schools, libraries and other publicly-owned buildings. The idea seems to be that by establishing these local “hubs” then other ISPs will later be able to harness them in order to extend ultrafast broadband outward, such as into nearby homes and businesses.

The newspaper doesn’t add any further detail, although the proposed approach sounds like it could be an extension of the existing £200m Local Full Fibre Network (LFFN) challenge fund. The LFFN focused on testing different approaches to stimulate commercial investment in “gigabit capable” broadband (rural and urban) through similar methods (connectivity vouchers, anchor tenants, connecting public buildings to fibre etc.).

Philip Hammond said:

“It is the spending on the skills of the next generation, the infrastructure, including the digital infrastructure, the broadband infrastructure. For the 21st century broadband is to roads in the 20th, railways in the 19th, and canals in the 18th. It’s the network infrastructure that will make this country work.”

Such a boost in funding will be welcome, although £250m+ remains a drop in the ocean of what digitally disadvantaged areas (e.g. rural communities) might eventually need in order to help extend such services out to individual homes and business, which is significantly more expensive than simply connecting key public sites.

Lest we forget that some operators (e.g. Openreach) have already installed fibre optic cables all the way to street cabinets or other buildings inside many rural communities. However, as stated above, extending those fibres beyond those sites and out toward individual premises remains very difficult and expensive.

The Future Telecoms Infrastructure Review (FTIR) very conservatively estimated that bringing FTTP/H to the final 10% of UK premises would require public funding of around £3bn to £5bn. This is on an assumption that it could be matched by investment from elsewhere (private sector, local councils etc.).

On the other hand there are many disadvantaged areas that could certainly benefit from a fibre optic “hub” (particularly places where such cables do not yet reach) and in those locations the proposed approach could have a very positive impact. But at this stage we only have the newspaper’s interpretation and so we’ll reserve further analysis until the full announcement.