CEO of BeFibre and Digital Infrastructure on UK FTTP Builds and Progress

Q6: The government has made a bunch of recent law changes, such as to help spread gigabit-capable broadband into new build homes (updates to the Building Regulations 2010), and to make it easier to install in large residential blocks of flats/apartments when landlords fail to respond (Telecommunications Infrastructure (Leasehold Property) Act).

On top of that, the new Product Security and Telecommunications Infrastructure Act (PSTI) hopes to make it easier for full fibre broadband and mobile network operators to upgrade, share and deploy new infrastructure (masts, poles etc.).

Are you expecting to see much of a benefit from these changes with your own rollout and, if so, in what areas do you expect them to have the most impact on your specific deployment?

Paul’s Answer:

While all positive interventions by the government are good news, we don’t expect these items to have a major impact on our specific deployment.

Q7: Following on from the prior question, are there any areas of legislation or regulation that you feel the government could still tweak or improve in order to support the work you’re doing to expand full fibre?

Paul’s Answer:

I would actively encourage the Department for Science, Innovation and Technology (DSIT) to continue to revise legislation and regulation to support the ongoing investment that we and other AltNets are making.

Companies such as ours have entered the market to address a failure of investment. As such, it’s important that this is recognised and supported in line with ambitious connectivity roadmaps — promoting a fair and competitive marketplace to ensure customers always have access to robust internet services.

Q8: Speaking of the government, during the latter stages of 2022 we saw some of the first full fibre rollout contracts being awarded under the Gigabit Infrastructure Subsidy (GIS) scheme, which forms part of the Government’s wider £5bn Project Gigabit programme. The project aims to help extend 1Gbps capable broadband networks (they currently cover 73% of the UK) to reach at least 85% of UK premises by the end of 2025 and then “nationwide” by around 2030.

What are your thoughts on the Project Gigabit scheme thus far and do you think it will be enough, alongside existing commercial investment, to achieve the targets and tackle the remotest of rural communities? In addition, do you have any plans to bid on the GIS contracts?

Paul’s Answer:

Our focus is not on areas under the GIS scheme and as such we do not propose to bid on those contracts. Government intervention is welcome in areas where deployment is not economically viable and I believe it can deliver on those ambitious targets. It’s important that the scheme supports, and does not effectively rule out AltNets who have the potential to deliver at speed and within budget by having open competition without unnecessary restrictions.

Q9: The rising cost-of-living has been a big topic during the past year and network providers are certainly not immune to its negative impacts, both in terms of higher costs for their own operations/builds and the risk of rising prices for customers.

In response, the government and Ofcom recently warned that ISPs should now “consider whether large price rises can be justified at times of exceptional financial hardship”, and they’re also strongly urging providers to offer and promote cheaper social tariffs to consumers (those on state benefits).

What are your thoughts on the pros and cons of offering a social tariff? In addition, how do you see this balancing against the highly competitive market for alternative full fibre networks, where new network builders are already competing aggressively on price – despite rising costs and high inflation – in order to peel customers away from rivals?

Paul’s Answer:

Of course, we want to help take the necessary steps to prevent a digital divide and understand the government’s plans to subsidise social tariffs. We believe in offering a transparent and competitive pricing structure that is accessible to all.

Q10: Speaking of pricing, the UK’s advertising standards authority appears set to require that ISPs be clearer and more transparent with their prices, particularly around the often thorny and confusing issue of mid-contract price hikes.

What is your view on how mid-contract price hikes should be handled by ISPs and do you think the ultimate answer is to just ban them (i.e. ensure all packages offer a true fixed price for the entire contract term), or take a different approach?

Paul’s Answer:

I believe the answer is to have a competitive and transparent marketplace with clear and appropriate price and product competition that is good for consumers.

Mid-contract rises may now be routinely accepted as ‘the done thing’, but any organisation with ethics should honour the price you signed up for — it shouldn’t take an industry-wide imposition to change that. That’s exactly what we stand for at BeFibre, and we’ll never knowingly make a promise we can’t keep.

Q11: The price of full fibre has also been a big topic among alternative network providers for another reason this year. Openreach recently proposed to make further discounts (Equinox 2) to their wholesale FTTP broadband products, which prompted Cityfibre to lodge a Competition Act complaint with both the Competition and Markets Authority (CMA) and Ofcom.

The operator accuses Openreach of “undertaking an aggressive strategy to foreclose infrastructure competition in the UK fibre broadband market“ (i.e. making it harder for smaller AltNets to grow customer take-up and thus attract investment). Where do you stand on this and does anything need to change?

Paul’s Answer:

It is a real necessity for regulators to properly assess the actions of incumbents to ensure that appropriate regulation is in place, aiding and promoting the growth of competition. The UK market and consumers stands to benefit from the infrastructure competition we and other companies are investing in. It is vitally important that regulation assures this now and into the future.

Q12: Moving away from pricing now. Ofcom were due to introduce their new One Touch Switch (OTS) migration (switching) system for UK broadband ISPs from 3rd April 2023, which was intended to make it easier for consumers to switch between providers on physically separate networks (i.e. extending the existing Gaining Provider Led [GPL] solution to include alternative networks, rather than just Openreach).

However, many ISPs and the related vehicle for this – The One Touch Switching Company (TOTSCo) – were NOT ready to introduce the system in time for the original deadline. What has been your own experience of OTS / TOTSCo and how long do you think before it can be fully implemented?

Paul’s Answer:

Not having the legacy complexity of an incumbent operator means we are open and ready for one touch switching, and look forward to starting the process once the switching hub is released. I really can’t speculate on when it will be fully implemented, but as a business, we have contributed to what the outcomes should be, and have been actively involved in the industry forums operated by TOTSCO. We await the delivery of the switching hub as does the whole industry.

Q13: Finally, over the past few years, there has been a notable shortage of skilled fibre engineers, which risks causing delays to the rollout of new full fibre networks. What has your own experience of this been (if any) and do you think that the government is doing enough to tackle the issue (e.g. working to add telecoms engineers to the shortage occupation list – making it easier to hire foreign workers)?

Paul’s Answer:

We were no strangers to the talent shortage. However, having participated in initiatives to improve the availability of surveyors through training and upskilling, as well as recruited skilled engineers from overseas, we quickly had access to the resources we needed to progress our build at pace.

As a company we have invested heavily in our people and culture, our aim is to retain and reward the talent that we have in our business. We recognise that it is not just about the identification and recruitment of such individuals, but it is about developing our own teams and providing ongoing training – career development is the key to an engaged and productive workforce

We’d just like to thank Paul for taking part in our interview and look forward to seeing how DI and BeFibre progress over the coming years.