Scotland Tenders for £40.7m Gigabit Broadband Rollout in Orkney and Shetland

ISPreview has spotted that the Scottish Government (SG) yesterday issued a contract notice for the Orkney & Shetland (Lot 6 – Scotland) deployment under the UK’s £5bn Project Gigabit broadband roll-out scheme, which is expected to expand full fibre (FTTP) connectivity to an estimated 13,550 premises in hard-to-reach (rural) parts of the remote Northern Isles.

Firstly, it’s important to point out that the SG is already working to expand FTTP coverage on the islands as part of their existing £600m Reaching 100% (R100) contract with Openreach (BT) – this includes the LOT 1 commitment that is expected to cover 60,764 additional premises across “North Scotland and the Highlands” by 2027/28. But only some of that will specifically benefit Orkney & Shetland.

The two island groups have a combined population of around 45,000, which suggests that the new contract, when combined with any improvements delivered via the R100 scheme, will result in a significant expansion of gigabit broadband coverage. But this will clearly come at a very high per premises build cost, which is to be expected given the remote and complex nature of the Northern Isles.

The new Project Gigabit contract is currently targeted to be awarded to a supplier in October 2025 (estimate) and will then remain in force for approximately 11 years – comprising a build period of approximately 4 years, followed by an operational period of at least 7 years. “It is the intention that the build period will be completed by the end of 2029,” said the public contract notice.

Local broadband services tend to be dominated by Openreach’s (BT) ADSL, FTTC and FTTP broadband network, which typically suggests that they may be the only bidder for the new contract. However, it is worth noting that Shetland Telecom, which is the arms-length network operator that the council set up some years ago, have in recent years looked at expanding their presence into the local access market (here).

In addition, an interesting project conducted with CloudNet recently used the community-owned water authority’s existing infrastructure (pipes used for drinking water) on Papa Westray in Orkney to run new fibre optic cables (here). But it’s too early to say if this will have any role in the new procurement.