Openreach CEO Appeals to UK Gov to Fix Planning, MDU Access and Permits UPDATE

The CEO of network access provider Openreach, Clive Selley, has today called on the new UK Government to help introduce “simple” fixes and reforms that would enable them to expand their gigabit-capable full fibre (FTTP) broadband ISP network into areas and properties that are still “missing out on upgrades” due to “red tape“.

Openreach have already extended their new Fibre-to-the-Premises (FTTP) network to cover 15 million premises (there are around 32.5m across the UK) and they aim to reach 25 million by December 2026. After that they have also expressed an ambition to reach “up to” 30 million by 2030.

However, the boss of the network access operator has today echoed earlier remarks from the CEO of BT Group, Allison Kirkby, who only a few short months ago highlighted that their ability to expand into some areas and particular properties was being obstructed (here).

Selley similarly warns that “out of date planning rules“, as well as restrictions on their ability to upgrade existing infrastructure inside large residential buildings (MDUs) and the permitting system for street works remain key challenges for their roll-out strategy that could mean “almost a million homes are still in danger of being left behind nationally“.

Clive Selley, Openreach CEO, said:

“Out of date planning rules mean owners must give express permission for upgrades – even when there’s an existing line in place. Sometimes finding landlords – let alone getting their agreement – is a major obstacle.

Already some 990,000 tenants are missing out on our Full Fibre network thanks to this red tape, but ministers have a chance to stop that at no extra cost to the taxpayer. With simple reforms to grant automatic upgrade rights. Ministers can prevent this new digital divide.

At the same time, everyone in the industry would welcome improvements to the local authority street works permitting system. Every year we apply for around 300,000 permits to carry out work on a street-by-street basis. But it’s no secret that the pandemic, global events and economic climate have left local authorities stretched, so it’s common to experience delays to permissions, which have a knock-on effect on broadband upgrades.

To achieve the stretching delivery targets set by Government, applications are likely to double over the next few years, placing a huge and unnecessary bureaucratic burden on everyone involved. A simple fix, at no cost to the taxpayer, would be to introduce flexible permitting – which allows builders to upgrade multiple streets at once.

It could even help deliver much-needed electric charging infrastructure as the country transitions from ICE to EVs.”

Naturally, solving some of these is not quite as easy as Selley makes it sound. For example, the issue of automatic upgrade rights in MDUs sounds fair and logical, but rivals warn that granting special access to Openreach – without also affording opponents a fair level of comparable accessibility – risks handing the incumbent an unfair competitive advantage (here).

The property owners will also have concerns that have to be balanced in all this (i.e. insurance, damage to property, security, safety (e.g. fire, asbestos) and other liabilities etc.), which is because upgrading copper lines to fibre in MDUs is often a bit more involved than it may seem (not minor work) and not everybody may want that. Suffice to say, network operators and the government will be walking a bit of a tightrope in terms of the rights of freeholders and leaseholders.

The second issue of street works permitting is, at least on the surface, much easier to resolve because flexi permits already have wide industry support within the utilities and telecoms sectors. This is where designated areas, rather than individual roads, can be combined into one permit for street works, which cuts time and reduces the costs.

However, the previous government were stalled on this and noted that flexi permits are not supported by everybody, with Highway Authorities often objecting to them. The HAs highlighted issues of rising administration costs, as well as difficulties with coordinating multiple works, overbooking of road space, and the potential loss of control/oversight of some works and practicality etc. In addition, not all utility firms have a good record and there was concern about the potential for this to get worse under flexi permits.

On the other hand, the new government have already set out their desire for more flexibility in the planning system via reform under the new Planning and Infrastructure Bill (here and here), which might make it easier to deploy new digital infrastructure. But it remains to be seen precisely how much of that will actually be of specific benefit to mobile and broadband operators that are seeking to expand and upgrade their networks.

Separately, in terms of mobile infrastructure, operators would still like to see it becoming easier and quicker to install higher masts to improve coverage (and thus also limiting / reducing the overall number of sites needed), together with greater freedoms to deploy smaller sites where greater capacity/infill is needed.

In any case, it will probably take a couple of years for this new bill to run the usual course of debates and studies before implementation, and a lot could happen in that time.

UPDATE 10:17am

The CCAO of London altnet Vorboss has given an alternative perspective.

Vorboss’ Chief Corporate Affairs Officer, James Fredrickson, said:

“Negotiating the delivery of new fibre has not held back rollout into MDUs for Openreach’s competitors – Openreach should compete on the same terms as its rivals, rather than seek to alter the law in its favour.

Ministers should not be fooled by Openreach’s ask regarding MDU access. Their evidence does not stack up. When reviewing gigabit connectivity rollout across Local Authorities, a higher proportion of MDU housing drives higher rates of gigabit connectivity coverage – and we have presented this analysis to ministers. This goes against the Openreach claim that MDUs are ‘in danger of becoming part of a new digital divide’. Rather, it suggests that continued national rollout will connect MDUs that are yet to be connected.

In truth, this is a monopoly, with Significant Market Power, seeking to leverage its legacy wayleave portfolio via primary legislation. This change could damage the competitive landscape that has driven the rollout of gigabit connectivity and deter future investment. It would also radically alter long-established principles of property law.

A genuinely level playing field in property access has allowed competition to flourish, and this one change could undermine that. Unintended consequences can be difficult to recover from.”