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Shetland Telecom to Seek Code Powers Ahead of Possible Fibre Expansion

Thursday, Jun 1st, 2023 (9:11 am) - Score 1,304

The Shetland Islands Council (Scotland) has given the green light for Shetland Telecom, which is the arms-length network operator that the council set up some years ago, to apply for Code Powers – ahead of a possible move to expand their full fibre broadband network to reach the remotest homes and businesses.

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 and linking up public sector sites, although they only provide the core network (inc. wholesale) and don’t sell broadband directly to homes etc.

NOTE: Shetland Telecom’s wholesale activities are estimated to generate income of £460k in 2023/24.

At the end of last year we reported that the council had opened a review into the future of Shetland Telecom (here), which came after the local authority found that the company lacked a clear strategy and could potentially do more to improve broadband connectivity (i.e. focusing it on the remotest locations that the Scottish Government’s R100 programme with Openreach may struggle to reach).

The latest update from the Council’s Development Committee suggests that the groundwork for a potential expansion of the network is already taking place, with a plan to seek Code Powers from Ofcom being approved.

Such powers are typically sought to help speed-up deployments of new fibre and cut costs, not least by reducing the number of licenses needed for street works. The powers can also help facilitate access to run their own fibre via Openreach’s existing cable ducts and poles (PIA).

High Level Summary of the Network

The Council’s fibre network is generally well developed due to significant investments in projects over the last 15 years. It links all Council and NHS buildings from Sandwick to Lerwick, Lerwick to Scalloway and Lerwick to Unst. It also plays a strategic role in connecting major international and local business and industry sites, such as the Shetland Gas Plant, Sellaness Industrial Estate, Viking Energy, Dales Voe Base (Decommissioning), Scalloway Harbour, Scalloway Fish Market, and Lerwick Fish Market. However there are areas of Shetland with existing or emerging issues which require consideration for potential future action.

Under the Electronic Communications Code, Code Powers confer rights on providers of networks and on providers of systems of infrastructure to install and maintain apparatus on, under and over land and results in considerably simplified planning procedures. The conferring of Code Powers would lead to operational efficiencies in installing, inspecting, maintaining and operating apparatus relating to the fibre network.

One of the cheerleaders for Shetland Telecom’s proposed expansion is North Isles councillor Robert Thomson, whom this week criticised BT for having an “Oliver Twist mentality” (i.e. always pleading for public money or it doesn’t expand) and warned that “if we sit back and wait for BT we’re going to get disappointed” (Shetnews).

The Deputy Leader of the SIC, Gary Robinson, similarly noted that the prices BT (we think he means Openreach) were quoting to upgrade some outlying communities were “frankly ludicrous“. For example, Clousta residents (reflecting around 15 homes) were said to have been quoted £725,000 to receive a faster broadband connection.

However, a quick look at Clousta shows that the community is a good 10km (6-7 miles) or so away – over rugged rural terrain – from the nearest Fibre-to-the-Premises (FTTP) connection on Openreach’s network. Sadly, no amount of wishful thinking is going to avoid the fact that extending full fibre to such a small and remote community is going to be obscenely expensive. Slower FTTC services can be found much closer in Aith, but that technology is no longer being built, and Starlink doesn’t currently reach Clousta as an alternative. But 4G based mobile broadband might provide a limited stop-gap solution in that area.

Suffice to say, Shetland Telecom may be able to deliver the core fibre links into such areas for a lower cost than Openreach could, but there’s no escaping the fact that even they will face a hefty bill to bring full fibre into those kinds of remote communities (assuming that’s the approach they take). The council does warn that the cost of expansion will be high, yet there’s currently no clarity on where the funding might come from.

The Development Committee is currently putting together a strategic outline programme for future extension of the Council’s Fibre Network, which is due to be published before the end of December 2023. The plan is expected to give a clearer indication of aspects like cost, which might help to concentrate minds as to the reality of what is and is not going to be possible.

At the same time, we shouldn’t forget that the UK Government’s £5bn Project Gigabit programme is also expecting to launch its first procurements for Scotland later this year, which will have to grapple with the challenges of Shetland and its limited local competition.

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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 X (Twitter), Mastodon, Facebook and .
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12 Responses
  1. Avatar photo aled says:

    Out of curiousity, now assuming Clousta is a farming community (looks like fields on Google maps satellite view), how expensive would it be for a farmer who owns the land to add poles over a 10km distance?

    1. Mark-Jackson Mark Jackson says:

      Too many variables. We don’t know if it’s one farm, or many, and what tools/machines they have access too or their attitudes toward doing the work, and that’s assuming they’d agree to waive the usual wayleaves too.

    2. Avatar photo Andrew G says:

      But we can do some ciggy packet estimates. A brand new telegraph pole is around £200 each on the mainland unless ordering bulk quantities, and probably 30% more when shipped to Shetland). You’d need about 18 per km in a windy rural location (again, maybe more), so that’s £48k just of poles. Now you need to install them. How much to install proper pole foundations for a mast in the Shetland? I’m guessing £500 a pop, including time, equipment and materials (as ever conservative for this location). SO erecting the poles is an extra £72k. Now what’s the cost of the fibre, splicings and stringing? Complete guess of £8 a metre gives me another £80k. You’ve then got the individual property routings and installation specifics that you’d need to guess at, but we’re already around £200k and we’ve not allowed for wayleave payments or legal setup costs.

      If anybody wants to correct my guesses, feel free, bearing in mind the costs of an easy job across one farmer’s land in say Hertfordshire won’t touch the costs of an install on a remote windswept island.

  2. Avatar photo Zed says:

    If they want early access to fibre, DIY is a sensible strategy for these remote locations. If there are any usable Openreach poles or ducts they can rent them cheap through PIA. Where its not available they will be able to install their own infrastructure quicker and cheaper than anyone else. But whatever they do, it with cost 100’s of thousands of pounds. How can the Councilor achieve that level of investment for 15 prems, without public funding? A shared Starlink connection would be a more cost effective solution.

    1. Mark-Jackson Mark Jackson says:

      As above, a lot of the most remote and poorly served parts of Shetland aren’t yet covered by Starlink, according to the latest availability map – it stops just short.

    2. Avatar photo GaryH says:

      A shared Starlink connection would be a more cost effective solution, Except starlink isn’t a comparable service, even less so if ‘shared’, has higher long term costs, ties users into a single provider, uses more power to operate, is a hugely wasteful concept, doesn’t meet the Gigabit goals,

      Starlink is nothing more than a stop gap for those on poor outdated connections, It’s not a Solution.

      Sadly Openreach quotes are a joke. which is why ALTs and community projects are viable. There’s no economy of scale in the estimates I’ve seen, like say £600 per pole x 10 poles thus £6000, no consideration of the logistics of manpower and equipment already being onsite and travel time for 1 pole vs 10 poles etc etc.
      Same story with the discount for FOD due to other properties passed, MY quote was a joke considering they counted 2 additional properties as viable when in reality 5 were brought into reasonable range and more were into the broadly affordable bracket.

      I do Accept fully that when you’re looking at a company investing on a purely speculative return running fibre to more rural properties the math simply doesn’t add up, the rental on a line is simply too low to recoup the investment in any reasonable time if ever, but the quotes do seem excessive as is always the case when you have a small pool of providers.

    3. Avatar photo Andrew G says:

      DIY may be sensible, but what if the properties benefiting from the farmland crossed aren’t the owners of that farmland? Who’s going to do it then? As a farmer would you allow amateur pole installers to build on your land?

      Even if you own the land and benefit from the connection, do you have the time and money to do the work? The farmers I know graft from sunrise to sunset (and often outside those hours) and despite their truly remarkable range of practical skills, wouldn’t have the spare money or time to do this sort of thing.

      Remote infrastructure is brutally expensive, and there’s no easy way round the economics that are based on metres of route per property passed. In an urban areas, it’s around 10m per property. In the sort of places we’re talking about here it’s up to or even above a kilometre per property, meaning a hundred fold difference in cost to provide a connection.

    4. Avatar photo GaryH says:

      @AndrewG ,
      Exactly, we’re in an area where there are hundreds of old croft farms, each would have been roughly 70 acres for a 1 man/family farm, resulting in properties roughly 1/2 to 3/4 a mile apart.

      Not commercially attractive for A provider and also unpalatable for the Scottish Gov R99 project.

  3. Avatar photo Martin Carlsson says:

    This makes me wonder how suitable ‘fibre through the water mains’ would be for the Shetlands, as a part-solution.

    1. Avatar photo GaryH says:

      CAnt comment on their specific situation but as i’m far less than that distance from a town of 20 thousand and dont have mains water sewage or gas , i’d guess a waterband connection may not be viable for many

  4. Avatar photo Interested says:

    Think if you speak to locals – there is definitely not a desire to see the council spend money on broadband when there is high levels of broadband coverage already via fttc. Subsea connections via r100 have been built and I believe engineers are already working on the north Isles and due to connect soon.. Hundreds of remote rural prems have already been connected from local intelligence and if you look on the Scotland superfast website – you get the sense there must be thousands planned. Be interesting to know which actual Premises shetland telecom think they want to build too ?
    Project gigabit is coming – so I assume whilst complaining of BT getting state aid – I assume like they did getting £2m in 2019 via lffn / they hope for a big chunk of money to do what?
    Lerwick looks like it is also planned for Openreach commercial

  5. Avatar photo GaryH says:

    However, a quick look at Clousta shows that the community is a good 10km (6-7 miles) or so away – over rugged rural terrain

    This come up time after time, I’ll assume the community is served by a road right ? so the terrain is irrelevant, trencher and fibre same as any other road, Or the telecoms was already installed by another route using decades old machinery and practices, todays equipment is vastly more efficient and capable. terrain and rurality difficulties are a smoke screen, it’s about cost vs return nothing to do with difficult.

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