BT Issues Report on Progress Against the UK Broadband USO

UK ISP BT has just issued their first biannual report on the progress they’ve made toward delivering the 10Mbps Universal Service Obligation (USO) for broadband, which highlights some of the known challenges. Overall they’ve so far handled 9,000 applications and 512 confirmed orders, resulting in a USO build for 4,000+ homes.

The USO, which was introduce in March 2020, is generally aimed at those who can’t yet receive a 10Mbps+ capable service and aren’t currently planned to in the near future. At present under 2% of UK premises (590,000) fall within the USO’s scope (falling to c.180,000 premises if 4G and fixed wireless technology is included), but a big chunk of that last part is still too expensive for even the USO to handle.

Despite this we have recently reported on various examples (here), where people have been hit with quotes for excess costs that run from tens of thousands of pounds and all the way up to well over £1m. Often this has been exasperated by issues of mixed messaging and inconsistencies in the quotes themselves. Suffice to say that the accuracy of BT’s quotes and how they’re pieced together has come in for a lot of scrutiny.

Ofcom has since launched an investigation into the issue (here) and the Government’s Digital Infrastructure Minister, Matt Warman, has also called on both sides to find a “resolution” (here). Easier said than done.

The USO Report

Overall BT’s new biannual report doesn’t add too much to this debate, although it does acknowledge the known problems and provides a useful overview of how many people are engaging with the new obligation. In the first six months of the scheme BT has seen nearly 50,000 visits to the USO section of their website, resulting in over 9,000 applications for new network build.

“We were able to refer most of these applications to existing products or already planned network builds that could meet their needs,” said BT. As a result the operator has seen 512 confirmed orders from end users so far (a single order could bring service to a larger community), and in response they are currently building USO connections that cover over 4,000 homes.

Some of the key stats can be found below and you can get the full context here.

The report goes on to acknowledge the problem where some customers have been left “understandably frustrated at being quoted significant sums to be connected … We know there is room for improvement in how and what we communicate in these circumstances,” said the operator.

BT said they’re now working to “help better set customers’ expectations of what the USO programme might mean for their specific circumstances through our initial engagements” and they’ll also aim to be clearer on what other options may be available beyond the USO, such as via Openreach’s Community Fibre Partnerships (CFP); although these too will often run into similar cost problems.

However, of more interest perhaps, is the fact that BT are now developing a “simple solution to enable customers to share costs above the £3,400 industry contribution amongst their neighbours who would also benefit (where there are other nearby households that will share the upgraded infrastructure),” which is something that the initial implementation failed to do.

Under the above approach, customers will retain the legal right to trigger network build themselves (by paying all costs above £3,400), but will also be given the opportunity to meet the costs together with others. In our view this is how the scheme should have worked to begin with, but in fairness it is quite tricky to organise this sort of co-operative approach.

A BT Spokesperson told ISPreview.co.uk:

“As the designated provider of the Government’s USO scheme, we’re committed to connecting as many premises as we can. While only a small number have completed USO installations in the 6 months since launch, it’s worth highlighting that there are more than 4000 USO fibre builds taking place right now, as well as a few hundred thousand that have been identified to be connected via 4G. We’ll also be increasing affordability for USO connections soon by offering communities the option to split the cost among neighbours.

However, for the more remote 0.5% of properties the high cost of a connection via the USO scheme may still be unacceptable, to which we urge Government, Ofcom and the industry to come together to work on alternative solutions, with the goal of figuring out ways to connect the hardest to reach places. We want to make sure no-one is left behind. Options could include alternative technologies, such as satellite (including exploration of the potential role of OneWeb) as well as more clarity on funding via the Government’s £5bn funding for rural full fibre.”

Much as we’ve said many times before, the big challenge for the USO was always that it wouldn’t be able to solve the problem for everybody, due to some unavoidably high costs (the biggest issue being that final 0.5% of hardest to reach premises).

BT points to possible solutions via Satellite and Fixed Wireless Access (FWA) technologies, although none of the commercially available satellite solutions today can meet the USO criteria (this is good because the current generation are rather poor) and BT doesn’t offer a true bespoke FWA product itself.. yet (beyond 4G mobile cover). Future LEO satellites (Starlink, OneWeb etc.) may help, but they’ve yet to prove themselves for this task in the UK (maybe by 2021/22).

The operator also points toward the Government’s forthcoming £5bn investment to ensure that every UK home can access a gigabit-capable connection (the target for achieving this is now unclear, after originally being set for the end of 2025). But a recent report from the National Audit Office (here) poured cold water on that by saying the final 1% of premises (e.g. the same sort of area as the USO) “could be prohibitively expensive to reach.”

The search for a truly universal solution to better broadband continues.