{"id":26200,"date":"2021-03-19T00:01:25","date_gmt":"2021-03-19T00:01:25","guid":{"rendered":"https:\/\/www.ispreview.co.uk\/?p=26200"},"modified":"2021-03-26T17:03:25","modified_gmt":"2021-03-26T17:03:25","slug":"gov-starts-gbp5bn-uk-gigabit-broadband-and-voucher-schemes","status":"publish","type":"post","link":"https:\/\/www.ispreview.co.uk\/index.php\/2021\/03\/gov-starts-gbp5bn-uk-gigabit-broadband-and-voucher-schemes.html","title":{"rendered":"Gov Starts GBP5bn UK Gigabit Broadband and Voucher Schemes UPDATE"},"content":{"rendered":"

The UK Government has today revealed new details of how their \u00a35bn gigabit broadband roll-out scheme will work and rebranded it as “Project Gigabit<\/em>“. As part of that they’ve also confirmed \u00a3210m for an extension of their rural Gigabit Voucher<\/a> scheme and \u00a3110m to connect up to 7,000 rural GP surgeries, libraries and schools<\/span><\/span>.<\/p>\n

At present around 40% of homes and businesses across the United Kingdom can already access a Gigabit (1Gbps+<\/strong>) speed capable broadband ISP network, which is likely to reach over half of premises by the end of 2021 (c.60%). But the majority of that is largely thanks to commercial deployments and upgrades in urban areas (i.e. most of it stems from Virgin Media<\/a>’s DOCSIS<\/a> 3.1 upgrade, while the rest comes from FTTP<\/a>).<\/p>\n

NOTE:<\/strong> Up to 80% of gigabit coverage is expected to be delivered by commercial projects, thus public funding is focused on helping the final 20% of premises (i.e. rural and sub-urban areas – c.5-6 million premises, which the market finds too expensive).<\/div>\n

The Government’s Project Gigabit<\/strong> programme wants such speeds to reach at least 85% of UK premises by the end of 2025, and they also aim to get “as close to 100% as possible<\/em>” – depending upon how the industry responds (i.e. so far only \u00a31.2bn<\/strong> has been released from the budget, but more will be unlocked if the industry shows they can deliver what is needed).<\/p>\n

Despite all this, it’s now expected to be the “first half of 2022<\/em>” before the first contracts are awarded under the new Dynamic Purchasing System<\/strong> (DPS) and the Government has also warned that those in the final 1% may still be “prohibitively expensive to reach<\/em>“. However, until now, the new programme has been largely stuck in the pre-launch design phase, but all that is about to change.<\/p>\n

Phase One of Project Gigabit<\/span><\/h3>\n

The first phase of Project Gigabit revamps the gap funded (i.e. direct supply side intervention) model, which we first saw in the previous \u00a32.5bn Superfast Broadband<\/strong> (SFBB) programme from the Building Digital UK<\/a> (BDUK) team, albeit with a few key changes. This is expected to gobble up the lion’s share of that \u00a35bn and involves inviting ISPs to bid on contracts for covering intervention areas of varying different sizes.<\/p>\n

The new scheme, which in England will be centrally managed by BDUK (as opposed to being managed by local councils like SFBB), will once again require bidders to ensure that their networks are available for use by other ISPs via wholesale (open access). Various operators, both big and small (e.g. Openreach<\/a>, Virgin Media<\/a>, Cityfibre<\/a>, Gigaclear<\/a>, Cityfibre<\/a> etc.), are expected to take part and areas with sub-30Mbps speeds will be prioritized (but NOT to the exclusion of all else).<\/p>\n

More than 1.1 million homes and businesses are expected to gain access to gigabit-capable connections in this first phase, starting with up to 510,000 premises<\/strong> in Cambridgeshire, Cornwall, Cumbria, Dorset, Durham, Essex, Northumberland, South Tyneside and Tees Valley.<\/p>\n

The first procurements to be announced from the above batch are:<\/strong><\/span><\/p>\n

\u27a4 110,000 to 130,000 premises in Durham, South Tyneside & Tees Valley and areas of Northumberland – including Darlington, Stockton, Hartlepool, Middlesbrough, Redcar and Cleveland, Sunderland, Gateshead and South Tyneside<\/p>\n

\u27a4 60,000 to 80,000 premises in West Cumbria including in the Lake District National Park<\/p>\n

\u27a4 30,000 to 50,000 premises in North and West Northumberland and East Cumbria – including Brampton and Rothbury<\/p>\n

\u27a4 120,00 to 140,000 premises in Cambridgeshire and adjacent areas – including Peterborough and parts of Northamptonshire, Essex, Hertfordshire and Rutland<\/p>\n

\u27a4 40,000 to 60,000 premises in East Cornwall – including Launceston, Callington and Looe<\/p>\n

\u27a4 30,000 to 50,000 premises in West Cornwall – including in Cambourne-Pool-Redruth and Penzance and the Isles of Scilly<\/p>\n

NOTE:<\/strong> On top of these six regional contracts above (‘Phase 1a’), there will also be further local supplier contacts in rural Essex and Dorset.<\/em> <\/span><\/span><\/p><\/blockquote>\n

Then, in June 2021, BDUK expects to announce the next batch of procurements (Phase 1b<\/em>) to connect up to 640,000 premises<\/strong> in Norfolk, Shropshire, Suffolk, Worcestershire, Hampshire and the Isle of Wight. Further details on these will follow in the future (quarterly updates are expected on all of this).
\n<\/span><\/span><\/p>\n

However, despite all the talk being that “available speeds will rocket to more than 1,000 megabits<\/span><\/span><\/em>,” it should be stated that the contracts themselves need to reflect reality (e.g. consumer connections share their capacity between users in order to remain affordable). In the real world this, and various hardware limits, mean that even if you buy a 1Gbps package then the ISP might not be able to deliver 100% of that speed to you 24\/7.<\/p>\n

Documents released in July 2020 revealed that BDUK appeared likely to require a “normally available<\/em>” download speed of at least 500Mbps and uploads of 200Mbps (here<\/a>) – as defined at peak times (8-10pm for residential and 12-2pm for business services). We’ll check later this morning to see if there’s any update on this, but saying 500Mbps is more about defining real-world capability on residential networks.<\/p>\n

In any case, most rural homes would hardly moan at such speeds. Nevertheless, some people may be confused by anything that seems like a dilution of “gigabit<\/em>” performance.<\/p>\n

More Public Sector Dark Fibre<\/strong><\/span><\/h3>\n

The existing demand-side intervention approach adopted by the Local Full Fibre Networks<\/strong> (LFFN) programme, where public money is used to help build Dark Fibre to connect public and community buildings (e.g. council houses, schools, libraries and GP surgeries) will continue and is being boosted by another \u00a3110m<\/strong>.<\/p>\n

The government states that this funding should help to extend gigabit fibre to connect up to 7,000 more GP surgeries, libraries and schools in rural areas. As before, the hope is that some of these Dark Fibre<\/strong> style deployments will later<\/span><\/span> be harnessed by the commercial sector (using private investment) to help extend Fibre-to-the-Premises<\/strong> (FTTP<\/a>) broadband into surrounding homes and businesses etc.<\/p>\n

The existing LFFN programme seemed to work quite well and the extra funding should make it more viable to take this approach in some of the hardest to reach parts of the UK.<\/p>\n

The New Gigabit Voucher Scheme<\/strong><\/span><\/h3>\n

Until very recently the existing \u00a3200m Rural Gigabit Connectivity<\/a><\/strong> (RGC) programme was still offering gigabit connectivity vouchers to people living in rural and semi-rural areas. The RGC scheme offered up to \u00a33,500 for businesses, or \u00a31,500 for homes, to help them get an ultrafast or gigabit-capable connection installed (last year many of these vouchers doubled in value<\/a>).<\/p>\n

NOTE:<\/strong> So far more than 66,000 vouchers worth up to \u00a3127m have been issued to premises across the UK.<\/div>\n

Sadly new applications for these vouchers have been in limbo for a few weeks because the existing scheme was due to finish on 31st March 2021<\/strong> (pre-existing projects will still be served until March 2022). We had been expecting a follow-on scheme to launch and today the Government confirmed that they’ve committed \u00a3210m<\/strong> to “relaunch<\/em>” the Gigabit Broadband Voucher Scheme<\/strong><\/a> (GBVS).<\/span><\/span><\/p>\n

The new vouchers, which will be of the same value as before (see above), will go live on 8th April 2021<\/strong> and “mean that rural areas will not have to wait for supplier contracts under Project Gigabit to reach them<\/em>.” Apparently a “new online postcode checker<\/em>” will be made available, so people can check if their home or business is eligible for a voucher, although it’s unclear how this will differ from the old one.<\/p>\n

As we’ve previously reported (here<\/a>), the follow-on scheme will only be available to those deemed to be in Ofcom’s Area 3 definition<\/a>, which reflects the least competitive rural areas (previously parts of semi-competitive Area 2 were also covered). This is necessary to reduce conflict with deployment contracts under the new gigabit programme and focus funding to where it’s needed the most.<\/p>\n

Some existing projects under the old programme, which are still in-flight and may have headroom for more vouchers after the scheme ends, may also be able to transfer to the new scheme, but obviously this will still exclude any Area 2 premises.<\/p>\n

Tackling the Final 0.3% of Premises<\/strong><\/span><\/h3>\n

As mentioned earlier, the Government (DCMS) has previously warned that those living in the final 1% of remote rural premises may be “prohibitively expensive to reach<\/em>” (here<\/a>). Today’s announcement notes that, “t<\/em>hanks to completed or pending government-funded projects<\/em>“, less than 0.3% of the country (i.e. under 100,000 premises) are likely to fall into this category (roughly the same gap that the 10Mbps USO has struggled to fill<\/a>).<\/span><\/span><\/p>\n

NOTE:<\/strong> According to data provided by the Office for National Statistics (ONS), there are approximately 420,000 premises in the UK which are classified as \u2018remote\u2019. This represents c.1.4% of the total number of premises in the UK.<\/div>\n

\"UK_Premises_by_Rurality_Pie_Chart_2021\"<\/p>\n

For these “Very Hard to Reach<\/em>” premises, which are mainly located in remote and isolated locations in Scotland and Wales, and some National Parks in England, a call for evidence<\/strong><\/a> has been launched to explore the barriers to improving their broadband and how innovative new technologies might help change this (open until 11th June 2021).<\/p>\n

The consultation states: “The costs of improving broadband coverage rise exponentially as deployment continues into the final percentage point of most remote premises. A very small proportion of premises – potentially less than 100,000 – are therefore likely to be significantly above the broadband USO\u2019s reasonable cost threshold and considered \u201cVery Hard to Reach\u201d with gigabit-capable broadband technologies like FTTP<\/a>. This is due to factors like their isolated geographic locations or the often substantial distances between them and existing or planned telecoms infrastructure, which make it challenging to deliver improved broadband<\/em>.”<\/p>\n

The suggestion is that all of this could lead to the government encouraging industry to use new wireless kit, LEO satellites (e.g. Starlink<\/a>, OneWeb<\/a>) or high altitude platforms to “beam faster connections to far-flung homes and businesses<\/em>.”<\/p>\n

We don’t know what the outcome of this will be, but we could easily see a voucher approach being extended to help cover the cost of Starlink<\/a>’s (SpaceX) hardware (c.\u00a3500). But at present the \u00a389 per month rental on Starlink<\/a> is still far too expensive for most people, so that would ideally need to change first (or OneWeb<\/a> may launch with better affordability). Fixed Wireless Access<\/strong> (FWA) networks may also help in some areas.<\/p>\n

Closing Thoughts<\/strong><\/span><\/h3>\n

Unfortunately what today’s announcement doesn’t tell us is how long it will actually take to achieve near universal coverage of gigabit-capable broadband. One recent forecast predicted that the UK could potentially reach 98%+ coverage by 2030 (here<\/a>) and that seems like a reasonable prediction, if still subject to a fair degree of uncertainty.<\/p>\n

The new programme, particularly its dominant gap-funded approach, is also a bit more complex than we’ve seen before. The new Dynamic Purchasing System<\/strong> (DPS) is designed to help do the heavy lifting here, but there’s no guarantee that delays won’t still creep in (we always see some problems with big projects like this).<\/p>\n

Meanwhile, <\/span><\/span>we still don’t know exactly how the funding will be managed for Scotland<\/strong>, Wales<\/strong> and Northern Ireland<\/strong> (Scotland has already had a little for R100, but that’s different – here<\/a>). England may have taken a centralised approach, but the devolved governments have already signalled that they’d like to be in charge of their own funding allocations, but BDUK\/DCMS may well worry about this approach attracting further delays (it took years to get R100 into delivery mode).<\/p>\n

Oliver Dowden MP, Digital Secretary, said:<\/strong><\/p>\n

“Project Gigabit is our national mission to plug in and power up every corner of the UK and get us gigafit for the future.<\/p>\n

We have already made rapid progress, with almost 40 percent of homes and businesses now able to access next-generation gigabit speeds, compared to just 9 percent in 2019. Now we are setting out our plans to invest \u00a35 billion in remote and rural areas so that no one is left behind by the connectivity revolution.<\/p>\n

That means no more battling over the bandwidth, more freedom to live and work anywhere in the country, and tens of thousands of new jobs created as we deliver a game-changing infrastructure upgrade.”<\/p><\/blockquote>\n

Boris Johnson, UK Prime Minister, said:<\/strong><\/p>\n

“Project Gigabit is the rocket boost that we need to get lightning-fast broadband to all areas of the country. This broadband revolution will fire up people\u2019s businesses and homes, and the vital public services that we all rely on, so we can continue to level up and build back better from this pandemic.”<\/p><\/blockquote>\n

At this point we should remind readers that, while a lot of the focus above will be on “full fibre<\/em>” FTTP technology, the Government is in fact adopting a technologically neutral approach to delivery (e.g. FTTP, DOCSIS<\/a> 3.1 Hybrid Fibre Coax, 5G<\/a> or fixed wireless broadband could all play a part). But the mobile variant of 5G<\/a>, due to its preference for lower frequencies to maximise coverage in remote areas, is unlikely to foster gigabit speeds for rural homes.<\/p>\n

Nevertheless, Project Gigabit is still a big step in the right direction and we welcome the fact that it’s now, finally, able to get out of the starting blocks. Alongside the Delivery Plan for Project Gigabit, DCMS has today published an update on the work of its Barrier Busting Taskforce<\/strong><\/a>. The Taskforce has played a key role in improving the environment for digital infrastructure investment and deployment.<\/span><\/span><\/p>\n

In the meantime, we shouldn’t forget that rural gigabit deployments have continued to be supported by extensions to BDUK’s original \u00a32.5bn Superfast Broadband<\/strong> (SFBB) project, which for the past couple of years has largely helped to extend FTTP coverage.<\/p>\n

Additionally, between September and December 2020, the government approved a further \u00a3490 million<\/strong> in new contracts via the SFBB programme across the UK to connect a further 172,000 premises to gigabit connectivity in Scotland, Cheshire, West Yorkshire, North Yorkshire, Lincolnshire, North Lincolnshire, Devon and Somerset. We suspect this will also help to push 30Mbps+ coverage to c.98% in around 2 years time (presently it’s c.97%).<\/p>\n

Project Gigabit – Phase One Delivery Plan<\/strong>
\nhttps:\/\/www.gov.uk\/..\/project-gigabit-phase-one-delivery-plan<\/a><\/p><\/blockquote>\n

UPDATE 6:54am<\/strong><\/p>\n

A few more comments from the launch.<\/p>\n

Clive Selley, CEO of Openreach<\/a> said:<\/strong><\/p>\n

” We\u2019re already building Full Fibre broadband to 20 million homes and businesses under our own steam – including in rural and hard-to-reach areas \u2013 and we welcome this as a vital next step to connect the toughest parts of the UK.<\/p>\n

We\u2019ll be considering these proposals for the final 20% with interest and we\u2019re keen to support the Government. This is a massive opportunity to level-up the country and boost the bounce-back after the pandemic, so it\u2019s important the process moves quickly and that all operators do their bit.<\/p><\/blockquote>\n

Greg Mesch, CEO of CityFibre<\/a>, said:<\/strong><\/p>\n

“Project Gigabit is another welcome accelerant that will propel the UK towards a Full Fibre future, supporting economic growth and levelling up opportunity right across the country. As the nation\u2019s largest independent Full Fibre platform, with a build programme underway to a third of the UK market, CityFibre is ready to extend our network even further to reach rural communities. We look forward to participating in this important programme to ensure no one is left behind.”<\/p><\/blockquote>\n

Gareth Williams, Gigaclear<\/a> CEO, said:<\/strong><\/p>\n

“As a rural operator already delivering multiple \u2018Superfast\u2019 BDUK contracts, we are naturally delighted to see the next step in the development of the Outside In programme.<\/p>\n

We are fully supportive of the Government\u2019s ambition to roll out gigabit capable connectivity across the country as quickly as possible, the importance of which has been further highlighted by the COVID pandemic.<\/p>\n

We look forward to playing an active role in meeting this ambition and will review these opportunities in detail.”<\/p><\/blockquote>\n

UPDATE 8:16am<\/strong><\/p>\n

The new Gigabit Project documentation also gives us a little preview of which areas \/ regions are likely to be in their Phase 2 procurements. “We are aiming to commence preparations in each of these areas by starting our National Open Market Review in the next three months<\/em>,” said the documentation.<\/p>\n

Tentative Phase 2 Procurement Plan<\/strong><\/span><\/p>\n

\u25cf Bedfordshire, Northamptonshire and Milton Keynes (Lot 12)
\n\u25cf Buckinghamshire, Hertfordshire and East of Berkshire (Lot 26)
\n\u25cf Derbyshire (Lot 3)
\n\u25cf East Sussex (Lot 16)
\n\u25cf Kent (Lot 29)
\n\u25cf Lancashire (Lot 9)
\n\u25cf Leicestershire and Warwickshire (Lot 11)
\n\u25cf Nottinghamshire and West of Lincolnshire (Lot 10)
\n\u25cf Oxfordshire and West Berkshire (Lot 13)
\n\u25cf South Yorkshire (Lot 20)
\n\u25cf Staffordshire (Lot 19)
\n\u25cf Surrey (Lot 22)
\n\u25cf West Yorkshire and parts of North Yorkshire (Lot 8)
\n\u25cf West Sussex (Lot 1)
\n\u25cf Wiltshire and South Gloucestershire (Lot 30)
\n\u25cf Potential projects in Scotland, Wales and Northern Ireland (Lots TBC)<\/p>\n

Beyond Phase 2 (TBA – later in the programme)<\/strong><\/span><\/p>\n

\u25cf Birmingham and the Black Country (Lot 35)
\n\u25cf Cheshire (Lot 17)
\n\u25cf Devon & Somerset (Lot 6)
\n\u25cf Herefordshire & Gloucestershire (Lots 15, 18)
\n\u25cf Dorset (Lot 14) (although note some Local Supplier contracts are being progressed here)
\n\u25cf Essex (Lot 21) (although note some Local Supplier contracts are being progressed here)
\n\u25cf Lincolnshire (including NE Lincolnshire and N Lincolnshire) and East Riding (Lot 23)
\n\u25cf Greater London (Lot 37)
\n\u25cf Merseyside and Greater Manchester (Lot 36)
\n\u25cf Newcastle and North Tyneside (Lot 38)
\n\u25cf Northern North Yorkshire (Lot 31)
\n\u25cf Remaining projects in Scotland, Wales and Northern Ireland (Lots TBC)<\/p><\/blockquote>\n

UPDATE 8:26am<\/strong><\/p>\n

The documentation also gives us a little more detail, albeit still not finalised, on how DCMS\/BDUK will approach the issue of working with Scotland, Wales and Northern Ireland. By the sounds of it, in Scotland these “Projects will be developed jointly by the UK Government and Scottish Government<\/a> through a collaborative approach, in which it is expected that the Scottish Government<\/a> will be the lead partner on implementation management on behalf of DCMS<\/em>.” As for Wales and N.Ireland, it’s still a little unclear, but there’s a lot of “working together” style waffle without any specifics.<\/p>\n

UPDATE 8:35am<\/strong><\/p>\n

Some might wonder what happened to all of the expected smaller procurements<\/strong> above, as much smaller clusters (bundles) were mentioned during the design phase. In short, there’s been a lack of specific proposals from suppliers and that has made it hard to implement, but they’re keeping the door open.<\/p>\n

This is what DCMS\/BDUK say on that: “The feedback from telecoms providers and local authorities confirms that there remains a strong level of interest in smaller procurements through the DPS. As described in this document, the lack of specific proposals<\/strong> to consider has made it hard to develop specific procurement areas so far, but we remain committed to the procurement route and will follow up with smaller telecoms providers expressing interest, particularly where they have proposals for areas to include in procurements<\/em>.”<\/p>\n

UPDATE 8:43am<\/strong><\/p>\n

In the above article we mentioned the launch of a new voucher website \/ checker<\/strong>, which the documentation suggests reflects the ability to give greater feedback on eligibility: “Where eligible, consumers will be able to contact registered suppliers to understand how vouchers could be used as part of a project to connect their community. Where not eligible, we will explain why and provide information so that consumers can identify what connectivity options are available to them and timelines for when we would reappraise eligibility if network build plans have changed or not progressed as expected. Providers will also be able to alert where they believe our eligibility assessment may be based on inaccurate records, just as they can today<\/em>.”<\/p>\n

UPDATE 9:36am<\/strong><\/p>\n

Another comment.<\/p>\n

Steve Leighton, Voneus<\/a>, said:<\/strong><\/p>\n

“As a rural provider of Gigabit connectivity, the Government announcement on Project Gigabit is welcome news to us and the communities we serve today. Working alongside Government, we look forward to playing an active role in future procurements, accelerating our Gigabit roll out to the hardest to reach areas of the UK.<\/p>\n

This transformational project, will provide much needed support to the rural communities we engage with on a daily basis, and we are ready to step in and make a real difference.”<\/p><\/blockquote>\n

UPDATE 26th March 2021<\/strong><\/p>\n

We managed to get an update on last year’s pilot of the Broadband Upgrade Fund<\/strong><\/a>, which was a consumer led (instead of supplier led) approach to the gigabit voucher scheme (i.e. like a dating site for vouchers where people\/communities expressed an interest in vouchers and suppliers could then choose to engage with them). We were curious about what would happen to this idea under Project Gigabit.<\/p>\n

Apparently, the final stage of the Broadband Upgrade Fund only recently completed, in January 2021, and many suppliers are still in the process of engaging with communities to put together project proposals to submit to BDUK for approval. Therefore, a full assessment of the effectiveness of the pilot will be done once there has been sufficient opportunity for proposals to turn into voucher projects. This will inform any decisions around whether to adopt this kind of model in the future.<\/p>\n

BDUK also clarified their position on setting the speed criteria for future gap funded contracts: “We will confirm the requirements in the tender documents for the procurements but have been making some changes to the technical requirements in light of feedback from the market. Essentially, the requirements will be largely consistent with commonly available in the market today from gigabit providers, including offering, as a minimum, a product that includes headline download speeds of 1Gbps with a (lower) minimum throughput during busy hour periods, plus a minimum upload speed. We expect bidders to offer other tiers of service and they will submit their wholesale product offerings and will be evaluated accordingly<\/em>.”<\/p>\n","protected":false},"excerpt":{"rendered":"

The UK Government has today revealed new details of how their \u00a35bn gigabit broadband roll-out scheme will work and rebranded it as “Project Gigabit“. As part of that they’ve also confirmed \u00a3210m for an extension of their rural Gigabit Voucher scheme and \u00a3110m to connect up to 7,000 rural GP surgeries, libraries and schools.<\/p>\n","protected":false},"author":1,"featured_media":26355,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0,"footnotes":""},"categories":[1,1645],"tags":[471,56,414,38,1997,89,537,71],"class_list":["post-26200","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uk_isp_news","category-key_uk_isp_industry_developments","tag-bduk","tag-fttp","tag-northern-ireland","tag-politics","tag-uk-gigabit-programme","tag-scotland","tag-uso","tag-wales"],"share_on_mastodon":{"url":"","error":""},"yoast_head":"\nGov Starts GBP5bn UK Gigabit Broadband and Voucher Schemes UPDATE - ISPreview UK<\/title>\n<meta name=\"description\" content=\"The UK Government has today revealed new details of how their \u00a35bn gigabit broadband roll-out scheme will work and rebranded it as "Project Gigabit". 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