{"id":5011,"date":"2014-04-28T02:31:09","date_gmt":"2014-04-28T01:31:09","guid":{"rendered":"http:\/\/www.ispreview.co.uk\/?p=5011"},"modified":"2014-11-27T13:41:42","modified_gmt":"2014-11-27T13:41:42","slug":"breaking-costs-330mbps-fttp-demand-broadband","status":"publish","type":"post","link":"https:\/\/www.ispreview.co.uk\/index.php\/2014\/04\/breaking-costs-330mbps-fttp-demand-broadband.html","title":{"rendered":"UPDATE2 Breaking Down the UK Costs of 330Mbps FTTP on Demand Broadband"},"content":{"rendered":"

BTOpenreach’s new FTTP<\/a> on Demand (FoD) product offers the attractive potential for anybody within reach of an FTTC<\/a> capable line to order a full fibre optic broadband connection, which\u00a0can deliver stable speeds of 330Mbps (30Mbps uploads)\u00a0using Fibre-to-the-Premises technology. But have cost and confusion killed the attraction.<\/p>\n

<\/p>\n

At present most of BT<\/a>’s superfast broadband (25-30Mbps+) roll-out has been conducted using their up to 80Mbps capable\u00a0Fibre-to-the-Cabinet<\/strong> (FTTC<\/a>) service, which takes a fibre optic cable to your local street cabinet and then distributes its service out using VDSL technology over existing copper lines.<\/p>\n

Unfortunately FTTC<\/a> has its limits. In particular\u00a0the last run of copper wire means that those who live furthest away from their local street cabinet can still suffer from slower speeds\u00a0because the signal degrades with distance. The minimum speed supported by FTTC is 2Mbps.<\/p>\n

Meanwhile BT<\/a> had originally envisaged a much bolder plan to make their 330Mbps capable Fibre-to-the-Premises<\/strong> (FTTP<\/a>) technology, which takes the fibre optic cable all the way to your property,\u00a0available to 2.5 million premises\u00a0(part of their \u00a32.5bn commercial roll-out). But this was abandoned (here<\/a>) due to being\u00a0slow to deploy, expensive and tricky to install (end-user installations were particularly tedious).<\/p>\n

Fibre on Demand (FoD)<\/span><\/strong><\/h3>\n

However\u00a0BT<\/a> still wanted to offer a fibre optic solution, which would give them an answer to the endless “why don’t you do real fibre optic connectivity?<\/em>” questions and be good for marketing. The solution they developed was called Fibre on Demand<\/strong> (FoD) or FTTP<\/a> on Demand<\/strong> (FTTPoD)\u00a0if you prefer, which at its most simplistic effectively shifted the cost of installing the FTTP infrastructure on to end-users.<\/p>\n

In theory this new service meant that anybody within reach of an FTTC line\u00a0could also now order FTTP via FoD, which was marketed more as a “premium<\/em>” service and aimed squarely at the small business\u00a0and or the\u00a0home office sector; this also meant that home owners could still technically order the service if they really wanted.<\/p>\n

Naturally FoD doesn’t come cheap. The service initially attracted a one-off fixed connection charge<\/strong> of \u00a3500 +vat and a monthly rental<\/strong> of \u00a338 (the same as their native FTTP product). But the real pain came from their one-off distance based charge<\/strong> (effectively the cost of building the network)\u00a0of \u00a32 per metre, which roughly translated meant that\u00a0more than\u00a0half of UK premises would face a total connection charge of between \u00a3700 and \u00a31,500 (BT figures).<\/p>\n

On top of this some premises might also have incurred an Excess Construction Charge<\/strong> (ECC), which could have potentially added thousands more to the final bill. Never the less some still saw this as a viable home solution, albeit more in the form of a longer term investment to help boost house value. But one year on and FoD, despite some good roll-out progress (here<\/a>), now\u00a0appears to be struggling.<\/p>\n

Market Confusion<\/strong><\/span><\/h3>\n

At present FoD is still in its EMD roll-out\u00a0phase, which lacks the same guaranteed service levels as a full commercial\u00a0product.\u00a0The service\u00a0is currently also available from 142 telephone exchanges<\/strong> around the United Kingdom, which should have increased to 303 by the end of March 2014 and\u00a0more are supposed to be coming (though we’ve yet to see the promised Q2 – 2014 roll-out update).<\/p>\n

<\/p>\n

In theory this means that the service\u00a0is currently\u00a0available to order by 4.7 million premises<\/strong>, although the concept of “premises passed<\/em>” has a different meaning\u00a0when the product you’re ordering doesn’t technically pass anything until after you’ve actually had it installed (note: once one line in your area has had FoD installed then it should be easier for everybody else to get it too).<\/p>\n

However you’d be hard pressed to find any ISPs that offer a FoD service and the EMD status is\u00a0just part of the problem. Some, such as PlusNet<\/a>, have run trials<\/a> but never proceeded to offer a product and even BT itself doesn’t seem to promote one (note: this doesn’t mean to say that they won’t offer FoD in the future). Similarly Clara.net SOHO<\/a>\u00a0did\u00a0do a 300Mbps FTTP package for \u00a395.99 +vat per month but not FoD.<\/p>\n

A Claranet Support Agent told ISPreview.co.uk:<\/strong><\/p>\n

“Please note that FTTPoD is still in a trial basis, and currently only available in certain areas, although it is becoming more and more widespread. We are not part of the trial runs for the service, however once it becomes released for ‘sale’, we will be able to provide the service.<\/em><\/p>\n

We have a few customer who have expressed an interest in FTTPoD and where they are enabled for it, we are seeing estimated installation costs which are well into the \u00a32000-3000 benchmark and more. So far however, we have not been able to place requests to order this for a customer where they can already receive FTTC as the FTTPoD is still on trial<\/em>.”<\/p><\/blockquote>\n

ISPs\u00a0have also struggled with whether or not to define the service as a consumer option or one that would be better for businesses\u00a0(here<\/a>).\u00a0On the consumer side, it’s very expensive and under Ofcom<\/a> rules\u00a0the 36 month contract<\/strong> term makes it a business-only proposition.<\/p>\n

On the business front,\u00a0FoD doesn’t seem to offer the same Service Level Agreements<\/strong> as a full Ethernet product, can’t be used to serve Multi-Dwelling Units<\/strong> (MDU) and BT has chosen not to\u00a0offer symmetric speeds<\/strong> like\u00a0many true FTTP\/H connections. The former CTO of business ISP Timico, Trefor Davies<\/strong>,\u00a0last year speculated that this might be\u00a0because it would have made BT’s own Ethernet products seem less attractive; though symmetric speeds\u00a0could equally\u00a0make it even more expensive.<\/p>\n

In fact so far the only ISP that has offered any firm public price and package details for a FoD product has been Gradwell<\/a>, which charges “from<\/em>” \u00a3200 +vat per month<\/strong> for the service with a 500GB<\/strong> (GigaBytes) usage allowance. But soon even that offer might have to be scrapped because of a huge price hike.<\/p>\n

Price Hikes<\/strong><\/span><\/h3>\n

In January 2014 Openreach<\/a> effectively made\u00a0the cost\u00a0situation worse by introducing a massive price hike (here<\/a>). As a result the standard monthly rental shot from \u00a338 to \u00a399, while the connection charge jumped from \u00a3500 to \u00a3750 and the distance based charge went from \u00a32 to \u00a33.50 per metre (i.e. more than half of premises\u00a0would now\u00a0face a total connection charge of between \u00a31,100 and \u00a32,500).<\/p>\n

Previously some middle-class\u00a0consumers could still have justified the service as an investment into the value of their property but no longer. Remember, ISPs still have to lump their own costs and a profit margin on top, thus \u00a399 +vat could quickly become a lot more (just look at Gradwell’s price for the old FoD product above as an example).<\/p>\n

Openreach<\/a> claimed that its original prices for FoD were based on various modelled assumptions (i.e. a small volume of completed orders), which sadly turned out to be wrong and thus the \u201ccost of deployment is higher than we originally expected<\/em>\u201c. So rather than withdraw the service completely they instead opted for a significant\u00a0price increase.<\/p>\n

On top of that Openreach<\/a> then decided to make the new prices effective from 1st May 2014<\/strong>, which we’re\u00a0told by industry sources has caused some of the ISPs that had been quietly offering FoD to suspend new orders until they could gain\u00a0clarity on the final prices (i.e. it’s a big investment for ISPs to\u00a0handle and they can’t simply absorb such a huge change).<\/p>\n

The Future<\/strong><\/span><\/h3>\n

FoD was a good idea but it’s one that now seems to be drowning in a sea of confusion and high costs. Meanwhile\u00a0the service is still being rolled out to telephone exchanges, although it’s unclear what the end deployment goal is or whether it will ever be achieved.<\/p>\n

Clearly if BT are investing so much money into a service that doesn’t seem to be seeing much adoption then the operator must\u00a0anticipate\u00a0some other longer-term advantage(s). Some speculate that the work might benefit\u00a0their future Fibre-to-the-Distribution-Point<\/strong> (FTTdp) \/ Fibre-to-the-Remote-Node<\/strong> (FTTRN)\u00a0developments, which could\u00a0potentially help to make FoD or native FTTP deployments cheaper in the long run.<\/p>\n

But\u00a0as a consumer (home) product\u00a0it’s no longer viable (short of gaining some mainstream ISP support), although smaller businesses might be able to look past the lack of symmetric speeds and its other shortcomings.\u00a0Indeed\u00a0it might\u00a0still work in some\u00a0cities where related firms can secure grants (worth up to \u00a33,000) to help cover the cost through the Government’s limited \u00a3150m<\/strong> “Super Connected Cities<\/em>” (Urban Broadband Fund) scheme.<\/p>\n

But right now there’s no escaping the fact that FoD\u00a0sits at a crossroads and its choice of direction appears more uncertain than ever.<\/p>\n

NOTE: It’s worth\u00a0saying that Openreach are also investigating the prospect of replacing their Excess Construction Charges<\/strong> (ECC) with a single setup fee<\/a> for most orders\u00a0(much like it use to be before), although this probably won’t\u00a0do much to help\u00a0FoD (i.e. if you have to pay ECC’s as well then your bank balance must already be\u00a0fairly large).<\/p>\n

UPDATE<\/strong><\/p>\n

Openreach has responded to this article\u00a0by confirming to us the latest batch of 163 telephone exchanges<\/a> that have been upgraded to support the Fibre on Demand<\/strong> (FoD \/ FTTPoD) service between late December 2013 and March 2014. We’re now trying to find out what the current Q2-2014 plan is since the plan for Q1 has been known since last year.<\/p>\n

UPDATE 27th Nov 2014<\/strong><\/p>\n

Sadly no further updates on FoD deployments have been issued since earlier this year. But we have at least found out that IDNet<\/a> also do a FoD service (here<\/a>), which starts at \u00a3203.40 inc. VAT per month and that’s just for a tiny 100GB usage allowance.<\/p>\n","protected":false},"excerpt":{"rendered":"

BTOpenreach’s new FTTP on Demand (FoD) product offers the attractive potential for anybody within reach of an FTTC capable line to order a full fibre optic broadband connection, which\u00a0can deliver stable speeds of 330Mbps (30Mbps uploads)\u00a0using Fibre-to-the-Premises technology. But have cost and confusion killed the attraction.<\/p>\n","protected":false},"author":1,"featured_media":4433,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0,"footnotes":""},"categories":[6],"tags":[474,472,52,56,69],"class_list":["post-5011","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-editorial_article","tag-bt","tag-business","tag-fibre-optic","tag-fttp","tag-bt-openreach"],"share_on_mastodon":{"url":"","error":""},"yoast_head":"\nUPDATE2 Breaking Down the UK Costs of 330Mbps FTTP on Demand Broadband - ISPreview UK<\/title>\n<meta name=\"description\" content=\"BTOpenreach's new FTTP on Demand (FoD) product offers the attractive potential for anybody within reach of an FTTC capable line to order a full fibre\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ispreview.co.uk\/index.php\/2014\/04\/breaking-costs-330mbps-fttp-demand-broadband.html\" \/>\n<link rel=\"next\" href=\"https:\/\/www.ispreview.co.uk\/index.php\/2014\/04\/breaking-costs-330mbps-fttp-demand-broadband.html\/2\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"UPDATE2 Breaking Down the UK Costs of 330Mbps FTTP on Demand Broadband - 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