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City Leaders Warn UK Full Fibre Rollout is Uncoordinated and Inefficient

Monday, March 25th, 2019 (10:30 am) - Score 1,848
fibre optic cable duct

Political leaders from 20 cities and towns across the North of England have written an Open Letter to Ofcom that calls for a more coordinated way of deploying new Gigabit capable Fibre-to-the-Premises (FTTP) based broadband ISP networks, which could speed-up the effort by avoiding the need to dig up streets several times over.

The letter, which is being supported by the independent Northern Powerhouse Partnership (NPP) and has been signed by the leaders of various city councils (e.g. Bradford, Manchester, Leeds, Sheffield and Newcastle), wants to see every home and business in the top 30 northern towns and cities being completely covered with “full fibre” by 2025.

The NPP suggests that even delivering just 50% FTTP coverage across the so-called “Northern Powerhouse” area could boost the economy by £26.2bn, rising to £47.2bn at 90% coverage. Such figures should always be taken with a pinch of salt because it’s notoriously difficult to accurately gauge the economic impact of increased broadband speeds from new infrastructure.

Meanwhile the government has already made clear that they want 15 million premises to have access to “full fibre” broadband by 2025 and then nationwide to all by 2033 (here), although last year’s related Future Telecoms Infrastructure Review (FTIR) stopped short of recommending any changes to tackle the challenge of overbuild between networks.

Henri Murison, NPP Director, said:

“Towns and cities across the Northern Powerhouse eagerly anticipate full fibre roll-out and its transformative potential to unlock productivity. But this letter highlights leaders concern that the North’s full fibre future is at risk from uncoordinated investment, acting against the interests of business and home customers.

In some cases we are seeing the needless duplication of full fibre networks, while at the same time, short distances away, other Northern towns and cities with no planned investment, risk being left behind on antiquated copper networks, missing out on the huge benefits full fibre brings.

If we are to close the productivity gap between North and South we need to be attracting businesses to come here and help others grow. Digital connectivity can and must play a major role.”

The letter appears to be seeking greater coordination between operators (e.g. Openreach, Cityfibre, Virgin Media, Hyperoptic etc.) in order to reduce the prospect of investment duplication, limit disruption from local street works and thus cover a wider area with the same amount of funding. All of which is easy to say but rather more difficult to deliver due to the aggressively competitive nature of the current commercial roll-outs.

In commercially competitive urban areas it’s quite normal for broadband operators to end up overbuilding each other with rival infrastructure (e.g. Openreach and Virgin Media). The move to build a new generation of FTTP networks, with investment flowing toward lots of alternative networks (i.e. weakening the hold of Openreach and Virgin Media), is essentially recreating this scenario for a new generation.

On the one hand this benefits consumers who will find themselves with a wider choice of broadband infrastructure. On the other hand, aside from the issues mentioned above, it can also create a problem for the providers as such networks are expensive to build and it could become more difficult for operators to gain a return on their investment.

Operators do try to avoid overbuilding but as they grow in scale then such clashes become inevitable (e.g. Cityfibre and Openreach in Coventry), although in some cases this can be mitigated by using existing infrastructure. For example, Openreach’s revised Physical Infrastructure Access (PIA) product can make it cheaper and easier for rivals to deploy their own “full fibre” broadband networks via existing cable ducts and poles.

An Openreach (BT) Spokesperson told ISPreview.co.uk:

“The Government and Ofcom have set a policy which encourages digital infrastructure competition and we support that.

Openreach already has a national network of underground ducts and poles, so we’re reusing that wherever possible to build faster, more reliable and future proof broadband. This network is available for other companies to use too, so it should reduce the need for roadworks.

Meanwhile we’ve been developing a raft of innovations and techniques which help us avoid closing roads and digging new trenches – such as ‘overblown’ fibre cables, endoscopic duct cameras and drones.

We’re also working closely with local authorities and highways agencies across the country to minimise disruption and coordinate works with other utilities wherever we can.”

Admittedly PIA, in the eyes of Openreach’s opponents, still has plenty of problems to overcome (here) and can’t be used everywhere, although Ofcom have proposed further changes that could help to make it more accessible (e.g. the possible adoption of “unrestricted usage” and better service level agreements etc.). But even with those changes PIA is only part of the puzzle and rival operators will still have to dig most of their own trenches.

The idea of achieving full co-ordination between such bitter rivals, which each tend to have their own build philosophies, regulatory considerations, standards, competitive interests and engineering teams / contractors, will not be an easy task and may be unachievable without radical change (like herding lions and hyenas together).

As state earlier, overbuild remains inevitable in such an aggressively competitive market and this tends to result in winners and losers (can vary depending upon the area). If left unchecked then natural market dynamics will eventually solve this (e.g. consolidation), although by then a lot of the overbuild may have already occurred.

The question of whether or not radical change will be needed is one for the Government to answer, although there’s clearly an appetite among alternative network providers for greater intervention (here). However politicians have to weigh this against the dangers of disrupting the existing competitive commercial environment and inward flood of investment.

For now it may just be a game of wait and see, with the big changes reflecting lots of tweaks around the edges to encourage broader deployments from all operators (e.g. softer regulation on planning, more access to Openreach’s ducts etc.). Caution and carrots, but few sticks.

UPDATE 2:07pm

We have the following comment from Cityfibre.

Greg Mesch, CEO of CityFibre, said:

“While the benefits of having competing full fibre builders at a national level are already clear – faster services, lower prices and greater reliability for consumers – at a local level, duplicative fibre rollouts will deliver no additional benefit to communities and starve other areas of investment altogether.

It’s critical that the voice of cities, their leaders and communities is heard. It is in their interest and in the national interest that coverage is maximised and that no area misses out.”

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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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20 Responses
  1. Avatar New_Londoner

    “The letter appears to be seeking greater coordination between operators … in order to reduce the prospect of investment duplication, limit disruption from local street works and thus cover a wider area with the same amount of funding. “

    Aside from a Ofcom wanting infrastructure competition, wouldn’t such coordination, particularly to “reduce … investment duplication”, be anti-competitive and therefore illegal?

    • Avatar Joe

      Yes. Although were the gov free to legislate to legalise that subject say to ofcom control that might be a good thing.

  2. Avatar Meadmodj

    No surprise here. If Ofcom want to make changes for these cities it will have to move quickly as most are already involved in either VM or FTTP implementations which may be the reason for their concern.

    Under the current strategy these councils need to realise that it will be a specific ISP (VM only. Talktalk only, Vodafone only) for consumers (as well as many businesses) over the next few years.

    Ofcom could/can impose a single infrastructure model. However they would also need to impose open Telephony/ISP access. Roll-out type access to OR infrastructure may in some circumstances compromise the copper to fibre switch both commercially and practically. It could work if Ofcom were equitable with their approach but this would go against their current strategy of re-classification and less regulation focussing as before on OR only areas.

    • Avatar Craig

      “Under the current strategy these councils need to realise that it will be a specific ISP (VM only. Talktalk only, Vodafone only) for consumers (as well as many businesses) over the next few years.”

      Ermmmm no. In cases where Cityfibre have laid the fibre (even if under a partnership such as VF-Cityfibre) then it will be wholesale’d to other ISPs willing to sell Cityfibre services, such as Giganet.

    • Avatar alan

      Yep dunno what he is on about again, Talk Talk also wholesale, there are a bunch of ISPs that use wholesale Talk Talk to provide already.

    • Avatar Meadmodj

      There is a difference between the regulatory control of OR compared with the discrete agreements made between a network provider and an ISP which are on a one to one basis. The Altnets may partner with specific ISPs but this will be to the exclusion of others.

      As for the CityFibre/Vodafone arrangement “Vodafone having the exclusive marketing rights while the network is under construction”. What will happen afterwards I don’t know but it is unlikely to be the wide access that would deter overbuild.

      We already have many streets covered by VM in addition to OR with both networks under-utilised (technically or revenue). Adding a third means simply means this under-utilisation increases. The consumer pays for that so do people really need possibly three Ultra/Giga points outside (all migrating to FTTP in time).

      I know the boat sailed long ago but the point here is these Councils now waking up to the fact its not like water, gas or electricity.

    • Avatar A_Builder

      @Meadmodj

      An alternative viewpoint would be that competition would force VM to invest in its network so that it can offer something to compete with FTTP and increase its upload speeds.

      DOCSIS3.1 can compete all VM needs is to sort it backhaul out and reduce the size of the daisy chain in some areas.

      There are signs of VM getting off its backside and testing 3.1 as well as building FTTP (OK it terminates as DOCSIS but it is essentially an good quality FTTP network.)

      So the current Alt Net medicine is working its way through the system.

      It has even cured OR of its cuprous addiction.

    • Avatar alan

      “discrete agreements made between a network provider and an ISP which are on a one to one basis. The Altnets may partner with specific ISPs but this will be to the exclusion of others.”

      None of those you mention only do deals on a one to one basis, the only exception may be VM.
      Talk Talk wholesale to whatever ISP wants to buy there products i can name more than a few you can buy a talk talk based service from if you wish.

      Cityfibre likewise do not just have a deal with voda they sell to others also, perhaps take a look at their partner page.

      You seem to be advocating or wanting regulation in a market, forcing people to sell to others when they are already doing it without interference, which is rather bizarre at best and would be a waste of time and money to do at worse.

  3. Avatar A_Builder

    Beware the dead hand of regulation.

    It is seductive to start to interfere in this but it is a young market and trying to regulate it will only slow things down.

    There is so much good stuff going on all over the place. Competition will direct builders to gaps. Those who do no do national coverage can charge more for connections to remote locations to recoup economic costs. There seems to be a fixation with the USO and USO pricing where as a multi participant environment inherently allow the market to adjust to keep investing.

    Slowing things down, by regulation, is to the advantage of the larger incumbents who are struggling to get up to speed. It also allows the incumbents to try and poach valuable subcontractors.

    At the moment I would leave well alone. Apart from trying to enforce following the rules on PIA – which have largely been ignored in the Wild West environment that has grown up.

    • Avatar Joe

      Avoid yes – and roll back. We already have some positively stupid rules from ofcom on price caps that are only distorting the natural market.

  4. Avatar alan

    “Openreach’s revised Physical Infrastructure Access (PIA) product can make it cheaper and easier for rivals to deploy their own “full fibre” broadband networks via existing cable ducts and poles.”

    ……. In the SHORT TERM maybe. Years later err NO.

  5. Avatar Jamie Simms

    Coventry is a prime example of why Ofcom Should make sure there is a more co ordinated rollout of FTTP.

    Cityfibre/Vodafone announced they were doing an extensive FTTP rollout in Coventry then 24hours later BT announce that they will be doing a large scale FTTP rollout in Coventry some in the same streets which is just stupid especially as some areas also have Virgin Media already.

    What should have happened is BT say ok we will Covofpr the time being and FTTP Leicester instead

  6. Avatar 5G Infinity

    Wrong Audience!

    Why send it to Ofcom, they are the regulator non the instigator – that is the remit of DCMS, BEIS, MHCLG, etc.

  7. Avatar Marty

    I don’t understand why they can’t award contracts based on constituencies to residents although for business it can be different for a provider to roll out FTTP system that everybody can use and add more fibre in the future for capacity repairs etc preventing overbuild and have the BDUK give back the cost to the provider or providers for rolling this out.

  8. Avatar Chris @ecomfttp

    It’s a shame these ‘city leaders’ don’t concentrate their efforts on making their streets more accessible to fibre builders instead of constantly trying to cream off the top of the budget and putting up barriers to entry.

    • Avatar CarlT

      Leeds have had a fairly large Virgin Media infill, Openreach build in progress and CityFibre start in May. They don’t have every street as a permit street and only ask for remedials where legally permitted, allow early starts as a matter of course and generally only reject works when necessary.

      Not sure what else you had in mind.

  9. Avatar Salek

    Just a thought – why doesn’t OFCOM have a bidding system, network builders submit thier bids to build in a chosen area, whoever is chosen for specific area has a limited time to build or face some sort of penalty, OFCOM could then mandate specific requirements such network sharing

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