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Stephen Timms and Ed Richards in front of Parliament inquiry
Tuesday 24 November 2009 14:36:23 by Andrew Ferguson

Having met earlier in November 2009 the Business, Innovation and Skills Committee has heard further evidence relating to Digital Britain and the Universal Service Commitment and Next Generation Fund.

Ed Richards, CEO of Ofcom outlined what they view as the three key factors people take into account when buying broadband,

  1. Is it available?
  2. How much will it cost?
  3. What speed will I get?

The industry regulator placed great emphasis on the speed research it carried out earlier in 2009, which given it did not cover ADSL2+ fully is perhaps now looking out of date, and as a guide for the buying public may mislead. The biggest problem with speedtesting is that a test done today cannot predict what speed you will get tomorrow, thus while one ISP may have performed better during the testing in the first half of 2009, another may have improved its performance as more capacity has been purchased, or more likely a good ISP may have got worse.

The Minister Stephen Timms appeared to get a harder time in front of the committee with them pushing for the minister to actually define what the 2Mbps Universal Service Commitment (USC) actually means. The closest we got seems to be that virtually all households will get a line capable of 2Mbps at some point during the day. In other words it is the connection speed, not the speed you will see from a download in the evening. The danger here, particularly with the bidding process, is that the lowest cost bidder who offers on paper a good solution might be making the cost savings by using higher contention and thus the performance when the kids are home from school and people are not at work is so bad that even basic video streaming may not work. The committee was informed that the definition of the USC will be done by the Network Design Procurement Group, with the staff of this being appointed early in the New Year. This means the time frame to define the service, and accept bids and actually start work will be very tight if the deadline of 2012 for all those without broadband now to have a USC meeting service will be met.

The broadband levy/tax was covered, with the confirmation that those who have a Virgin Media cable broadband service, and the associated telephone service, will be paying the levy too. It was also heard that those with a telephone service over a pure fibre connection would have to pay. Exemptions for a number of low income groups will exist, but the Finance Bill will provide the detail. An interesting issue is that those warning that the tax may not finish when 2017 arises may have had their fears further enhanced, as it was suggested the tax may continue to fund further coverage.

What was interesting to observe was the disjoint between the level of certainty over where the commercially led Next Generation Roll-outs will go between Ed Richards and Stephen Timms. The minister seemed to be more sure that commercial roll-out will leave around a third of the country on first generation services, where as the Ofcom chief was less sure, citing examples of what a game changing effect TalkTalk had on the LLU market.

Comments

Posted by herdwick over 7 years ago
" those who have a Virgin Media cable broadband service, and the associated telephone service, will be paying the levy too." - given that the VM telephone service isn't strictly *associated* with the broadband does this mean 50p on the BB, the phone line, both or either ?
Posted by andrew (Favicon staff member) over 7 years ago
50p on the phone line.

You don't need any form of broadband to be subject to the levy, just a fixed telephone line of one form or another.

Posted by Davidhs over 7 years ago
As you say, the 2Mbps must refer to the modem synchronisation connection speed.
Surely, achieving this for rural users at some distance from an exchange is surely a technical challenge, rather than something at the mercy of a low bid.
Once we have a technical fix to ADSL or a policy decision to get around it by installing "sub-sub-exchanges" closer to remote end-users, then that fix or policy decision can be applied generally.

What we lack at the moment is a clear statement as to HOW a 2Mbps connection might be delivered to remote users.
Posted by andrew (Favicon staff member) over 7 years ago
That is why the USC is not aimed at just ADSL.

Openreach have BET, two pairs get 2Mbps at ranges of 15km.

Satellite is in the mix, as are fixed wireless, mobile and next gen solutions like FTTC if the financials stack up.

Until the NDPG is formed, we can only guess on the solutions.

Put it this way, no reason you can't have 2Meg now anywhere, apart from the cost.
Posted by Rocklett over 7 years ago
"Satellite is in the mix, as are fixed wireless, mobile and next gen solutions like FTTC if the financials stack up."

God help those that find themselves stuck and having to use satellite with no other choice.
Posted by Davidhs over 7 years ago
"God help those that find themselves stuck and having to use satellite with no other choice. "

... and one of the places I am helping at present has just ordered satellite. Tomorrow I go to see what came in the toy box!

Andrew, thanks for BET lead.
Those people wouldn't mind if 2 lines were required. It is a small business.
Posted by cyberdoyle over 7 years ago
Davidhs, if you agree to BET solution it will always stay a small business or even go out of business. BET is not the answer. And why should a small business have to pay for two lines plus broadband and still have 400:1 contention when it gets to the exchange, meaning exceptionally slow connection for more money? fight for fibre. fibre is the end game, and cheaper to lay that than more fibre to rurals.
Posted by andrew (Favicon staff member) over 7 years ago
400:1 contention - which provider is that?

BET still leaves you free to choose the retail supplier or even LLU supplier.

Fibre in the local loop will not reduce contention, unless we pay substationally more per connection.
Posted by Dilidel over 7 years ago
I can't even get Broadband on my landline. I do have satellite broadband so if I was being forced to pay a levy on my landline then I would give it up and just keep the mobile and my satellite broadband. The 'superfast' broadband is probably great but there are many people like me who can't even have out telephone lines upgraded to cope with current broadband speeds. It is not only people on a personal level affected but those who run small businesses from rural areas.
Posted by AndrueC over 7 years ago
@Cyberdoyle:FTTP has no direct effect on contention. In fact if the ISPs don't invest in backhaul and core to keep pace it will make it far worse. Luckily the backhaul and cores are already fibre so if the money is there ISPs can upgrade quite easily but do we trust them?

FTTC actually makes contention worse because it brings it closer to the home. The link from cab to exch is now contended which it isn't with ADSL.
Posted by cyberdoyle over 7 years ago
cost to buy 100 connections from bt wholesale to 8meg pipe = £18.72 +vat per month per customer, + admin and profit. Many people on deals of 'free' £7.99, £14.99. do the math. How many people do you have to put on a card in an exchange to make it pay? Lots of cheaper ISPs put more than 100 on. They have to. so up to 400 is normal. all sharing an 8meg feed.
Posted by cyberdoyle over 7 years ago
if anyone wants to know the truth about BET read this post and the comments on it. http://media140.org/?p=252
Posted by Dawn_Falcon over 7 years ago
Yes, yes, cyberdoyle, we know you don't want rural communities to have any form of high speed access at all.

The so-called author of that piece and you are once more arguing against BET on connections which will not get fibre on a timescale measured in decades.
Posted by andrew (Favicon staff member) over 7 years ago
With Openreach FTTC the documentation I've seen to date states that the link from cab to exchange is UNCONTENDED.

Posted by cjbell68 over 7 years ago
I think there will be cases where BET is a suitable option - but people need to understand how it works and be sure they aren't in a position to get a more scaleable, future-proof solution before settling on BET.

I don't want to get into a discussion on what is economically viable and I'm sure some form of funding is needed to extend next gen rollout in whatever form, but it would be sad if BET solutions get deployed in favour of another, more future proof solution.
Posted by AndrueC over 7 years ago
@Andrew:Is it? Oh well that's good. I thought I'd read that there was a minimum guaranteed speed but above that was contended. Good to know I'm wrong on that.
Posted by cjbell68 over 7 years ago
@AndrueC - it flows back to the exchange though?
I'd love FTTC from our exchange, but I bet we'd then have backhaul problems. Would be a nice problem to have though - and I guess an easy fix if they could sell the bandwidth.
Posted by AndrueC over 7 years ago
Yeah what Andrew is saying is that FTTC is no different from a contention point of view than ADSL whereas I thought there was an element of contention between cabinet and exchange.

It does still of course put greater stress on backhaul and perhaps network core. Not just the step increase (up to 8Mb/s --> Up to 40Mb/s) but a step increase in the average. I'm guessing 4Mb/s -> 20Mb/s at least.
Posted by cjbell68 over 7 years ago
Yes - if I understand you correctly there will be a higher proportion of users actually realising the headline speeds with the shorter loop lengths?
Posted by mikeblogs over 7 years ago
I was surprised by the emphasis Richards places on his average speed research. There is no truth in averages, but perhaps just a bit more that the 'up to' claims.

On 2mbps, I have seen a 21C def for 2mbps (line speed dependent) delivering a download experence of 2Mbps for 90% of the peak three hours. There is still only a peak hour allowance of 30-35Kbps per user.

So the best way to desribe the USC sercice would be to describe a browsing experience with a peak hour allowance and a download experience averaged over the peak hours.


Posted by mikeblogs over 7 years ago
The other that must be done is to describe how these services degrade as load increases.

Oh And it is all best effort and engineered to make sure you need to keep your legacy voice bills.

I wish Ofcom would stay away from the propaganda on averages.
Posted by AndrueC over 7 years ago
@cjbell68:That's what I'm assuming but it's only a guess. If I'm right that would exacerbate the backhaul upgrade requirements. Either way they need to be upgraded and it'll be very interesting to see how the ISPs respond to that :)
Posted by Somerset over 7 years ago
Article says:

BET is the current proposal by BT Openreach to widen this copper pipe. However, one of the key problems is that this very pipe is shared. It is shared, not only with your direct neighbours, but with all the other people in your vicinity (i.e. everyone who is on the same BT exchange). So, whenever they want to use it, you get less. Simples!

What does that mean?!
Posted by cjbell68 over 7 years ago
@AndrueC - hopefully a greater demand for higher bandwidth services will stimulate people to pay for larger usage allowances if not indeed paid for content on top. Which should permit investment in backhaul to support. However it seems to be a bit chicken and egg...

@Somerset - I read that part about BET too, implies shared lines? Is that this DACS thing I hear about - don't know if that's relevant, I assumed you could have 1mbps on a single pair with BET or 2mbps with a two pairs bonded - but hadn't considered it needed to be a shared service? Need to know more about BET to be sure.
Posted by Dawn_Falcon over 7 years ago
Somerset - It's rubbish. Party lines went out decades ago.
Posted by Somerset over 7 years ago
Chris Doyle (Cyberdoyle) wrote my quote in the article at http://media140.org/?p=252. She has a problem understanding the local end and backhaul from exchanges.

BET is one solution that will help some people.

Dawn - who is talking about the old type of party line?
Posted by AndrueC over 7 years ago
That blog and it's comments are an interesting read. You're right though that Cyber still seems confused about backhaul. She's right to be concerned about it but she keeps linking it to FTTx as if she thinks that the backhaul is copper as well. She's almost suggesting that FTTx will 'cure' backhaul problems.

@Cyber (if she's reading this):Is that what you think?
Posted by Dawn_Falcon over 7 years ago
Somerset - That's the only "shared" line type which was used by BT
Posted by Somerset over 7 years ago
Dawn - DACS is shared. Party lines 30 years ago were shared. What's your point?
Posted by chrysalis over 7 years ago
I have heard quotes it cost £3000 per line to enable BET, and there is no future proofing in that investment. If BT are even considering spending £3000 per line for not spots then surely FTTx is a no brainer more longer lasting investment.
Posted by chrysalis over 7 years ago
I thought about this and I think the solution to BT milking taxpayer money to lengthen life of copper is that that there is an enforcement the 50p tax can only be used on FTTx rollouts, no substitutes. In addition where it is used the taxpayer takes a cut of revenue so they are paid back aka not a free gift to BT etc. Unfortenatly the status quo have won this battle and the UK has a poor future in the digital economy.
Posted by Dawn_Falcon over 7 years ago
chrysalis - Great, so the people who'd otherwise get BET simply won't be offered broadband. You've *really* helped them.

It's basically one way, regulation and sharing from BT without the funding they should be getting for it.
Posted by CARPETBURN over 7 years ago
^^^ Still daydreaming a PRIVATE company should get funding??

How about you send me millions i got a private company also.
Posted by Somerset over 7 years ago
BT is not a private company, unlike yours.
Posted by CARPETBURN over 7 years ago
Well if its not a private company what is it? Its certainly not publically or government owned.
Posted by Somerset over 7 years ago
It's a public limited company.

British Telecommunications plc (BT) is a wholly-owned subsidiary of BT Group plc and encompasses virtually all businesses and assets of the BT Group. BT Group plc is listed on stock exchanges in London and New York.
Posted by Dawn_Falcon over 7 years ago
Carpetburn - Do you have regulation specifically and only costing your company, and no other, money?
Posted by CARPETBURN over 7 years ago
quote"It's a public limited company."

So not a Publically owned company, so explain again when they should get funding???
Posted by CARPETBURN over 7 years ago
quote"Carpetburn - Do you have regulation specifically and only costing your company, and no other, money?"

Although that makes no sense ill do the best....
A) Regulations?? Of course every business has regulations it must legally follow
B) Regulation requirements that only cost the company??? Of course, insurance, various business taxes, ill leave it there to keep it short
Posted by Somerset over 7 years ago
Cb - what's your solution then?
Posted by CARPETBURN over 7 years ago
quote"Cb - what's your solution then?"

Solution??? Not sure what you mean, if Virgin can roll out a 50Mb service there is no reason BT cant do the same by there self, is there???
Why would they need additional funding??? H20, Virgin and satelite providers didnt get additional funding for there new services did they??? Or if they did it certainly is nowhere near the amounts BT keep sniffing for.
Posted by Somerset over 7 years ago
BT is rolling out to the areas that ISPs like Talk Talk want. But so far not to rural areas, just like VM etc.
Posted by CARPETBURN over 7 years ago
quote"BT is rolling out to the areas that ISPs like Talk Talk want. But so far not to rural areas, just like VM etc. "

Indeed so why should any of them get funding?
Taking rural out of the equation atleast other companies are trying to provide services with faster speeds even if its not to the whole country, BT just want us all to fund it for them and even then i doubt rural areas would see vast improvement.
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