Shetland Islands Council Seeks Strategy for Shetland Telecom

Shetland Telecom, which is the arms-length network operator that was originally set up by the Shetland Islands Council (Scotland) to develop local fibre optic infrastructure, is facing a review by the local authority after councillors found that the company lacked a clear strategy and could potentially do more to improve broadband.

The operator was originally established in 2009 as a Special Purpose Vehicle (SPV) to help deploy a wholesale fibre optic network across part of the Islands. As a result, they played a key role in connecting Shetland into the SHEFA-2 (Faroese Telecom) subsea fibre optic cable, although they only provide the core network and don’t sell broadband directly to homes etc.

The fibre network developed through Shetland Telecom provides high-capacity data links to a wide range of public sector services including schools, health centres, care facilities, port operations and ferry services, and provides a wholesale market to telecom companies selling to the local private sector. The wholesale activities are estimated to generate income of £460k in 2023/24

But a recent internal audit of the organisation by Audit Glasgow concluded that: “Management should compete a review of Shetland Telecom to determine if it remains fit for purpose/appropriate.” Such a review is now being prepared and some councillors would like to see the operator being given a greater role in solving Shetlands remaining broadband woes. But it’s also possible that they may choose to offload the venture to a third party.

The review is also intended to ensure that the Council operates within its powers under relevant legislation, including the Local Government (Scotland) Acts.

Extract from Meeting of Development Committee

An audit of Shetland Telecom undertaken in October 2022 included observations that, while the project formally concluded in 2016, the role and purpose is currently unclear, and that there is a reputational risk from a lack of clarity surrounding the purpose and authority of Shetland Telecom.

The audit report recommends that management complete a review of Shetland Telecom to ensure that it remains fit for purpose and that the Council continues to operate within relevant legislation, including, but not limited to, in relation to subsidy control.

Whatever the council decides, the authority has pledged NOT to disrupt existing services. “Achieving continuity in the use of the Council’s fibre optic assets will have a positive impact on people who access Council, NHS and other Community Planning services, and will secure connectivity to essential fibre infrastructure,” said the committee.