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New BT CEO lights the fuse on fibre future
Monday 14 April 2008 13:04:27 by Andrew Ferguson

Apart from a testbed/show case of fibre to the home (FTTH) services in Ebbsfleet the UK is falling away from the cutting edge of broadband. The much vaunted 50Mbps DOCSIS 3.0 roll-out by Virgin Media is likely to take some time to complete and will only be available at addresses already served by the cable network.

The incoming BT chief executive Ian Livingstone has been discussing his views in the FTTH issue with the Sunday Times:

"We will not spend material amounts of money that will guarantee that we lose money for shareholders [..] It’s just not going to happen. [..] We want changes to the USO to reflect a fibre world."

Ian Livingstone, BT Group

The likelihood of the BT Group being allowed to install a fibre network where the only broadband provider is BT Retail is as likely as every visitor to thinkbroadband winning the lottery next weekend. A scenario where connections are available at a wholesale level akin to IPStream products seems the best BT could get whilst at the worst they may be required to lay multiple fibres so that an unbundling process for fibre can take place just like it does for the copper local loop. This would add a fair bit to the estimated £15 billion fibre roll-out costs.

No doubt a common ground may be achievable such as other operators accepting shared access on the same fibre. One common stumbling block is the millions many LLU providers have invested in hardware and business models that appear to assume the existence of the copper local loop for many years to come. Those with foresight will have installed DSLAM hardware that can cope with VDSL2 or fibre connections on the local loop side.

There could be one big advantage to the UK having a single common operator for the local loop, since it provides a potential solution to those pushing broadcast video content over IP networks. Installing a cache server for every exchange or cluster of exchanges would become easier and reduce the costs of delivering traffic from products such as the iPlayer and 4oD.

BT is looking for a way out to make a fibre roll-out return a dividend for its shareholders in the future and issues such as high definition television on Freeview and access to video on demand content appear to be taxing the entire broadcast industry. Perhaps the time is right for the two industries to co-operate to create a TV/internet access infrastructure fit for the 21st Century. Broadcasters have been involved in other technology roll-outs before, for example the BBC Micro and the original setup of the TV transmitter networks and the ongoing development of the Freeview platform.

Comments

Posted by fusen over 8 years ago
damn shareholders :P why can't they do something for the good of everyone instead of for money...now onto a serious thought, it sucks to be reminded that the broadband picture in the uK really isn't going to change much in the foreseeable future, I wonder how Verizon managed to convince their shareholders that laying all that fibre was worth it
Posted by kev445 over 8 years ago
Verizon don't have to share their network :)
Posted by chrysalis over 8 years ago
what would happen if the government forcefully took back ownership of BT? I expect it may not be legal but just curious.
Posted by AndrueC over 8 years ago
@chrysalis:A lot of howling and screaming from the financial sector. Given that it's responsible for a significant part of the UK's economic survival I think it would be a bad idea.

In addition those of us that remember what the telephone network was like before BT would lynch anyone that seriously suggested going back to state ownership.
Posted by KarlAustin over 8 years ago
It's be robbed of all profits and the network would fall in to disrepair and spend for-ever-more using ageing equipment - just like it was before it was privatised.
Posted by tikka69 over 8 years ago
So as per usual, we are again stuck in this vicious circle, and are getting nowhere.......

Surely it must be a lot cheaper to lay fibre now compared to copper with the price what it is ?

Think of all those old pairs they could weigh in if they replaced them.... ;o)
Posted by andrew (Favicon staff member) over 8 years ago
Laying fibre where there is no existing infrastructure ala Ebbsfleet is cheaper.

For areas where existing services use copper are present you end up having to keep copper in place, which makes fibre roll-out more expensive.
Posted by c_j_ over 8 years ago
Stick to facts please, Mr BT.

This USO of which you speak, what has it to do with broadband investments?

I believe the answer is "eff all", because it applies only to voice and to lowish speed dialup.

I've read the Times article too and he don't make much more sense there either (getting rid of payphones to pay for FTTH????)

The UK's main broadband problem is the monopoly-based price of BT Centrals, and the lack of effective regulation thereof.
Posted by paulbeattie87 over 8 years ago
Well I can't agree with the above post about the price of BT Centrals. Like everything else at BT the price charged is tightly controlled by Ofcom. Even the slightest change in price whether up or down has to be approved by Ofcom.

As for the cost of fibre, I know a BT shareholder and he wouldn't want his money being wasted on such an investment with no return.

Being a shareholder of British Gas I wouldn't like them giving away free gas to customers at my expense. Its all down to money!
Posted by Dawn_Falcon over 8 years ago
...Ofcom whistle BT's tune
Posted by herdwick over 8 years ago
"This USO of which you speak, what has it to do with broadband investments?" quite a lot - one concern is being required to maintain a copper USO network in parallel with a fibre build - potentially robbing BT of the savings in operating / maintenance cost that would result from switching to fibre.

Verizon have bumped into this too with some people screaming about the loss of their copper line and having to use Verizon's FIOS.
Posted by jchamier over 8 years ago
I thought the concern over FiOS and copper line was the lack of power if the mains fails and the battery pack in the FiOS box runs out. Whereas with copper the line is powered from the exchange. (Mains failure being common in the US, due to overhead lines).
Posted by c_j_ over 8 years ago
"price .. tightly controlled by Ofcom"

Here's a history lesson.

Four years ago this week, AG reported [1] BTw's initial proposals for new improved pricing. Read it; the end results weren't vastly different than the proposals (eg [2] has today's prices in detail).

2004 quotes: "<why is> BT Wholesale doing its sums on a 20kbps average per user?" and "the days of almost non-existent contention may be over". 20/20 foresight.

Fix the economics+politics first, then the techy stuff is easy.

[1] http://www.thinkbroadband.com/news/i/1620.html
[2] http://preview.tinyurl.com/ywk64o
Posted by herdwick over 8 years ago
"I thought the concern over FiOS and copper line was the lack of power" - that may be one concern, but the yanks have a vibrant "long distance" market (local calls being bundled with the line rental) which they are denied access to if they get FIOS and lose the copper. Another issue is DSL users being pushed onto FIOS

http://text.dslreports.com/shownews/Verizon-TOS-Change-Forced-FiOS-Upgrade-89428
Posted by nmg196 over 8 years ago
I long for the day when everything is delivered by a single fibre - TV, phone, FAST broadband all over one little fibre with no need to have a dish if you want decent quality (HD) TV. Fibre has the capacity to deliver everything that Sky can broadcast via satellite, so nobody would actually need a dish as long as sky had put a repeater in your local phone exchange. Similarly, if the BBC, ITV and C4 put a cache server in each phone exchange, we could all watch anything from the last week in real time without having to spend hours downloading content via P2P.
Posted by ian9outof10 over 8 years ago
What we really need is a nationalised provider for fibre communications, one who will invest in the network, then lease it back to TV companies, businesses, ISPs, even Virgin, in areas where it isn't viable for them to lay their own cable.

This could be done through the sewer system, as those tunnels are big enough and for the most part easily accessable (although finding an engineer prepared to service a broken cable might be hard).

This government company could spend X each year until the country has a decent fibre backbone (it should be required to service rural areas, as BT was).
Posted by chrysalis over 8 years ago
"spend for-ever-more using ageing equipment" Sounds like now :)
Yeah I wasnt old enough really to experience pre privatisaion days of BT, but I raised the question as I hardly call BT cutting edge now I just see them as a corporation whoring profits.
Posted by mpellatt over 8 years ago
ian9outof10 - I can only assume you're not a taxpayer - it wouldn't be some vague entity called "government company" spending "X each year" - it would be every taxpayer, with no choice. This was the model that built the highly broken BT in the first place.

Into this debate, from a shareholder point of view, should also be added the huge amount of empty space in every BT exchange building - an asset producing no return whatsoever. This is where a highly intelligent distributed content delivery system should be built, to my mind.
Posted by c_j_ over 8 years ago
"empty space in every BT exchange"

Afaik there is *no room left* inside many exchanges. Partly because a handful of LLU providers each want to install duplicate kit in places where they think there's money to be made. Outside those areas, there might be space available, but the market isn't interested.

BT is broken but it's the market (and no regulation) that broke it, like it broke the railways. Maybe the UK telcos look a bit like railways pre 1947 nationalisation - lots of competition on cherry-picked routes, no joined up thinking, no real investment. Maybe Dr BTching will be along soon.
Posted by comnut over 8 years ago
meh, if the internet was like the railways, they would be promising london to edinburgh in 5 mins!!! - and blame 'technical problems' for for why it really takes longer!!!

Posted by anglo over 8 years ago
Something is amiss in this thread!
I got it!
Carpetburn is missing!!
Posted by comnut over 8 years ago
meh, I think he is maybe just recovering from the school holidays!!!
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