BDUK Examines Impact of UK Local Full Fibre Networks Project

The Government’s Building Digital UK team has today published yet another new evaluation report, albeit this time into their Local Full Fibre Networks (LFFN) programme, which shows how the scheme has tried to spread more Dark Fibre networks across the country and foster a wider rollout of gigabit broadband.

Just to recap. The LFFN began all the way back in March 2018 (here) with the aim of helping to spread Gigabit (1000Mbps+) class fibre connections to “key public buildings and businesses, with the expectation that this leads to broadband providers (ISP) creating additional connections to local homes and businesses.”

The scheme adopted a demand-side intervention approach that mixed mechanisms like connection vouchers for businesses, with aggregated demand schemes and the opening up of access to existing public sector infrastructure (cable ducts) etc. Most of the funding for this (£294m by March 2021) helped to foster the build of new full fibre networks to connect public sector sites (councils, NHS, police, schools etc.).

The idea was simple enough. On the one hand, the local authorities (or anchor tenants) would benefit from faster and more cost-effective infrastructure. But on the other hand, they could also make that fibre available to broadband ISPs in the private sector (i.e. if they wanted or needed to, this could be used to further expand their own commercial gigabit-speed networks to reach local homes and businesses).

The LFFN programme was recently given another £110m funding boost via the launch of the Government’s new £5bn Project Gigabit programme, which suggests that there’s still plenty of demand for this kind of approach.

Results from the LFFN Report

Strictly speaking, we think it may still be too early to fully gauge the impact of the LFFN programme, not least since many of the related networks have only recently been completed and a number of projects are still very much in-development. Nevertheless, the new report from Ipsos MORI only examines the first Wave One projects from 2018 and offers a somewhat incomplete indication of what has been achieved so far.

The Wave One LFFN Projects

● The Public Sector Asset Re-use (PSAR) ‘Thin Layer Model’ Tameside project. This project seeks to demonstrate how far it is feasible to deploy assets owned by the public sector to stimulate the market to increase the supply of Fibre-to-the-Premises (FTTP) connectivity. Total project spending targets were met in 2018 at £2,262,000 and no difficulties with project build were reported by stakeholders.

The project was completed in 2018. The LFFN Wave One build was 4km short of the 17km target set out in 2017, and the wider network is 7.7km below the 50km target (as of January 2020 data provided to Ipsos MORI).

Cooperative membership has grown substantially since 2018 including new suppliers such as Virgin Media. Recent growth in membership has been driven by two new local authority members (Blackpool and Manchester City Councils) which are providing assets.

Deployment of FTTP in Tameside has improved, however, the placement of LFFN Wave One PoPs might not have been optimal given the spatial distribution of impacts to date.

ITS Technology have driven private sector extensions to the networks in the north of Tameside from Ashton Under Lyne and south from Hyde and Longdendale with these PoPs leading to bigger impacts further from the ring.

Take-up of ultrafast connections appears negligible at this stage. The Cooperative members also suggested that there have been lessons learned in terms of the service levels (SLAs) needed to provide services to larger businesses and public sector organisations.

Public sector members further suggested that as membership of the Cooperative expanded, they learned more about how broadband markets work and commercial requirements for operating the Cooperative. They believed shared learning events held with other public sector bodies were beneficial to better understand the market and disseminate their experiences with the project.

● The West Sussex Public Sector Anchor Tenancy (PSAT) project (otherwise known as the West Sussex Gigabit project). This project provides 137 public sector buildings with gigabit capable connections and seeks to use these connections as long-term tenants.

The installation of the fibre was completed by July 2019. It was expected that all connections would be completed by the end of September 2020. However, connections to public buildings were delayed and were in the process of being installed at the time of the research taking place (September 2020). Therefore, it is still too early to fully assess the outcomes and impacts the project could achieve.

Resource remained a significant barrier particularly with testing capacity required to ensure that the work had been completed to specification. Remedial works were also required and undertaken where build did not meet the required specification after installation. There were issues with fibre laid at 65 sites and this contributed to the delay in completing the work prior to Covid-19 becoming a further issue, impacting resource and the ability for testing teams to access infrastructure. Covid-19 further impacted delivery with further delays to the fibre supply.

Wayleaves remained an issue for a small number of public buildings with five still in the process of being negotiated. These were for varying reasons related mainly to landlords and tenants with three the result of an inability to obtain permission to access NHS sites, one other involving a tenant dispute and a third awaiting sign off once remedial work to remove hazardous material is completed.

As of September 2020, the West Sussex project was still ongoing with the anchor network completed but with a fraction of final connections to public buildings having been made. Connectivity outcomes were not expected to be evident in the Connected Nations dataset for 2019 as a result. This hypothesis was confirmed.

Trends in the West Sussex areas close to the anchor network remained very similar to those in the matched areas in Kent. This confirms the choice of these areas as a counterfactual.

As of September 2020, there had been no significant change in the suppliers operating within the West Sussex areas visible using ThinkBroadband data.

However, CityFibre had announced FTTP build in the West Sussex area which suggests FTTP connectivity in West Sussex will increase in the near future.

● The Trans Pennine Initiative (TPI) project. This project also aims to demonstrate how far it is feasible to deploy assets owned by the public sector to stimulate the market to increase the supply of Fibre-to-the-Premises (FTTP) connectivity.

The physical works were completed in December 2019, with a core fibre optical cable installed and operational between Manchester and York, and to internet exchanges.

The overall aim was to install nine Fibre Interface Points (FIPs) along the route, of which five had been completed by August 2020. Network Rail are planning to install further FIPs along the route (beyond the planned nine), to try to enhance the impacts of the network. These will utilise internal Network Rail funding or funding from external sources, but not LFFN funding.

Network Rail has secured a small number of public sector customers and is generating income from these customers. Additionally, a small number of private sector companies have expressed an interest in utilising the network. However, as of August 2020, Network Rail has not been able to secure any direct private sector customers – which if continued will limit the impact of the project. Some of this delay can be attributed to COVID-19 restrictions. The reasons for the lack of private sector customers will need to be explored in later stages of the evaluation to fully assess how viable the business model for the TPI is.

As the TPI project completed the network build in mid to late 2019, it is not expected that any potential connectivity outcomes or impacts will be visible in the Connected Nations dataset for 2019. However, these datasets have been examined to show how the key outcomes have altered over time, and how these compared to the national average prior to the completion of the TPI project.

Deployment of FTTP connections within 1km of the TPI route has increased between 2017 and 2019 (from three percent to 13 percent), with the increase being in line with the increase at a national level. Between 2018 and 2019, FTTP availability rose in postcodes within 1km of the TPI route. This pattern was observed at all distances from the route.

There has been an increase in the number of suppliers providing FTTP services along the TPI route since 2019 – when there was good coverage from Virgin and pockets of coverage from BT, Vodafone, Hyperoptic and CityFibre. In August 2020 there was still sporadic coverage from Vodafone, Hyperoptic and CityFibre, but the degree of coverage from BT had increased dramatically since 2019, and ITS had increased coverage in the Tameside area of the route.

The take-up of FTTP services along the TPI route has followed the national trend, rising to 0.02 connections per postcode (compared to 0.06 connections nationally). The same pattern is observed in the comparator area between Reading and Bristol.

Overall, the report makes for quite a laborious read, where the main challenge will be trying to stay awake while going through all 90 of its pages. If they use up this many pages on just three projects, then we can’t even imagine how they’ll handle the many other projects that formed part of later waves. The full report is here.