Devon and Somerset UK Award Phase 2 FTTP Broadband Contracts

The Connecting Devon and Somerset team will be hoping that the third time is a charm after they awarded £80m worth of contracts for Phase 2 of their delayed “superfast broadband” (30Mbps+) rollout project, which sees 6 LOTS being split between three suppliers (Airband, Truespeed and Wessex Internet).

The existing CDS scheme has already helped 300,000 extra premises gain access to “superfast broadband” connectivity and take-up in those areas has reached nearly 70%. The vast majority of this was delivered via BT’s (Openreach) earlier (Phase 1) state aid funded contracts using FTTC and a little FTTP (plus a new extension), while a fixed wireless access (FWA) and fibre network from Airband is working to cover c.23,000 premises.

More recently CDS has been busy hunting for suppliers to deliver their rehashed Phase 2 scheme, which followed the failure of their earlier contract with Gigaclear (here). Sadly, that contract was scrapped last year due to a lack of FTTP build progress, which in turn also followed an earlier failure to reach a Phase 2 deal with BT all the way back in 2015 (arguably CDS wanted more than BT were able to deliver within the tight time-scale).

Meanwhile last year’s Open Mark Review (OMR) identified around 115,000 premises that still couldn’t access or won’t be able to get superfast speeds for years, but the new contracts won’t be able to resolve all of that.

Summary of the New Contracts

The new Phase 2 contracts divide around 56,396 premises (mostly rural areas) between six LOTS and these should all complete by around 2025 (here). The combined public and private sector investment for these equates to around £80m, which includes £18.43m from DCMS (BDUK), £2.98m from the England European Regional Development Fund and £2.15m from the Heart of the South West LEP’s Growth Deal with Government.

The Contracts

— Airband will be expanding its full fibre coverage into rural areas of Somerset West and Taunton, parts of Sedgemoor, East Devon, as well as areas of Mid Devon, South Hams and Teignbridge. This reflects about 37,500 premises and includes roughly £25.5m of public investment.

— Truespeed will be working in B&NES (Bath & North East Somerset), North Somerset, Mendip and part of Sedgemoor. This reflects over 15,000 premises and includes roughly £6.7m of public investment.

– -Wessex Internet will deliver in rural communities of South Somerset. This reflects a little over 3,600 premises and includes roughly £4.7m of public investment.

As we predicted, the CDS team haven’t awarded any of the new LOTS to BT or Gigaclear (BT didn’t bid). Instead, they’ve opted to harness some increasingly familiar local suppliers, which are already busy deploying a mix of wireless (FWA) and Fibre-to-the-Premises (FTTP) based broadband connectivity solutions in the area (the three ISPs have already covered nearly 41,000 premises in the CDS region).

The new contracts will extend the aforementioned work by ensuring that all of the 56,000 premises being targeted are covered by a new gigabit-capable FTTP network. Work on all this is due to start next year and they will aim for completion in 2024 (we’ll assume they mean the end of 2024).

Matt Warman MP, Minister for Digital Infrastructure, said:

“Today’s announcement marks a major step forward in our mission to build back better in the South West, with thousands of homes and businesses set to be linked up to lightning-fast gigabit broadband thanks to an £18.4 million investment by the government. With Airband, Truespeed and Wessex Internet now on board I am confident we will deliver on our ambition for an infrastructure revolution in Devon and Somerset.”

Councillor David Hall, Somerset County Council said:

“We’re pleased to confirm the appointment of three well-established, regionally-based suppliers to help with the challenge of delivering the next phase of the CDS programme. They have significant experience of delivering broadband connections in rural areas of Devon and Somerset, so they have an understanding of the remote areas where CDS is looking to improve connectivity. This investment will deliver full fibre broadband ahead of many other parts of the country.”

Councillor Rufus Gilbert, Devon County Council, said:

“These contracts will deliver vital connectivity to a significant number of rural communities across Devon and Somerset helping our businesses and supporting local jobs. Access to services online, home working and staying connected has never been more important, and these investments will provide a much needed boost to our rural and coastal communities.”

The decision to split these contracts into smaller lots, which are then shared between several relatively familiar local suppliers, should hopefully help to mitigate any potential concerns about the ability of such operators to deliver on what they’ve promised. Indeed, all three were already in the process of scaling-up their builds following fresh commercial investment. As ever, the proof will be in the building.

The new rollout project will also complement the UK Government’s wider £5bn Gigabit Broadband Programme (F20), which previously aimed to ensure that “every home” could access a 1Gbps capable connection by the end of 2025 but now only expects a “minimum” of 85% coverage by that date (it’s focused on helping those in the final 20% of hardest to reach premises). So far they’ve only released £1.2bn of the £5bn budget for this.

No doubt additional funding from that gigabit programme will eventually be used to help plug the remaining gap in the CDS region, but that will be for a future contract. Meanwhile CDS is also working closely with the Government’s Rural Gigabit Voucher programme to support communities who wish to contract with telecoms providers to design bespoke broadband solutions for their communities.

To date, over 3,400 premises in Devon and Somerset have been connected to fibre through the Rural Gigabit Voucher Scheme, with another 2,800 vouchers approved for build over the next 12 months. This represents a voucher investment of nearly £7.4m in full fibre across the CDS region.