UK Gov Reject Openreach Proposed Fix for Part Built Fibre in Wales

The UK Government appears to have rejected a £12.9m accelerated gainshare proposal from Openreach (BT), which was first proposed last year (here) as a possible solution to help complete a number of unfinished (part-built) “fibre broadband” (FTTC and FTTP) deployments in Wales.

Sadly a fair few FTTC/P deployments under the original contract were left unfinished when Phase 1 of the Welsh Government’s (WG) state aid supported Superfast Cymru scheme came to an end last year. Since then a £22.5m Phase 2 successor contract has been agreed with BT, which aims to provide an additional 26,000 premises with access to “fast reliable broadband” (mostly via ultrafast “full fibre” FTTP) by March 2021 (details).

A spokesperson for the Welsh Government has previously informed ISPreview.co.uk that any partially built deployments would not form part of the 26,000 premises announced for Phase 2 so far as these remain a “matter for Openreach and have not been paid for by the Welsh Government.”

However toward the end of 2018 Julie James AM revealed that the WG had received a proposal from Openreach as part of an £12.9m “accelerated gainshare arrangement agreed between the UK Government and the European Commission.” Under that arrangement, Openreach would be able to complete part built structures not completed and not paid for under Superfast Cymru.

Several months have now passed and Russell George AM recently requested an update (credits to Steve for spotting). The bad news is that Openreach’s proposal has been rejected by the UK’s Government’s Department for Digital, Culture, Media & Sport (DCMS), but it’s not the end of the road.

Lee Waters AM, Deputy Minister for Economy and Transport, said:

“The accelerated gainshare proposal to complete FTTC structures cannot progress following a UK Government decision not to provide National Competency Centre assurance for further FTTC solutions.

The funding earmarked for accelerated gainshare remains available for investment in broadband and those premises potentially covered by the proposal will now be considered through the successor programme.

Stranded assets remain a commercial matter for Openreach. No public funding has been invested in these structures.”

We have asked DCMS to clarify its decision and will report back once they respond. In the meantime the response suggests that the WG may still be able to find a solution using the same gainshare investment, although there’s no escaping the fact that this puts related areas back into a state of uncertain limbo.

The conflicting language of, on the one hand, saying that stranded assets are a commercial matter for Openreach while, on the other hand, saying that such premises might still be covered through the state aid supported successor programme does little to aid clarity over the situation. We also note the specific reference to FTTC above, not least because a number of the part built areas were seemingly due to get FTTP.

In any case those people living in such locations now seem unlikely to benefit from a quick fix and will thus have to wait even longer for a solid solution.