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Government announce consultation on Next Generation Broadband fund
Thursday 07 January 2010 12:28:36 by John Hunt

The government have today launched a consultation to work out how money from the Next Generation Fund should be spent. The 50p levy on all telephone lines is the source of the funds and is expected to raise around £175m a year, with £1 billion of this to be used by the government to help provide super-fast broadband to 90% of the country by 2017. Without the use of the fund, it is estimated that next generation broadband, currently available to 50% of the population (thanks to Virgin Media's cable broadband network), would only reach 70% of the country.

"This investment is about bringing the future of broadband to areas of the country that would otherwise miss out. We cannot underestimate the opportunities this will bring for homes and businesses which is why we are taking action to make sure everyone benefits.

"Already the market is delivering superfast internet speeds of 50Mbps to half the country but we cannot be certain that it will reach the communities that are not currently served, which is why we are putting in an extra £1billion to support the market.

"By upgrading our networks we will put the UK at the fore of rapidly developing technologies which will bring jobs, boost business potential and grow our digital economy."

Lord Mandelson, Business Secretary

The government aims to stay technology neutral and is evaluating different Next Generation Access (NGA) technologies including Fibre to the Cabinet, Fibre to the Home, Satellite, WiMAX and Long Term Evolution (LTE) which may be viable options. It's currently uncertain when things like LTE are likely to be deployed so fixed line solutions seem like the likely option in the short term.

One thing to note is that this fund is separate from the USC to provide 2meg broadband to everyone. There may be some overlap in this where the USC will fill in broadband not-spots and may use NGA to do this, and as such, the NGA project should avoid unnecessary investment where this may occur. Another consideration they are making is to whether a 'claw back' scheme should be used. This would enable the government to take back a proportion or the entire amount awarded from the fund should there be a return on the investment greater than a specified level in a certain area. This would help save money in areas where the market can fund next generation broadband itself.

The government are also intending that where money is provided, it should be used to fund an 'open access' network. This would of course mean that it would work in a similar way to existing fixed-line broadband from BT where providers can sell their own broadband services over the BT deployed network, helping to give consumers a choice and produce some competition to the market.

The consultation can be read in full on the Department for Business Innovation & Skills website, and is open for responses until 01/04/10.

Comments

Posted by cyberdoyle over 7 years ago
low income and elderly will be exempt from phone levy. most low income have mobile anyway. if the levy gets through statute many will dump phone line, thus increasing exclusion. Levy would probably only raise £100 million which means it will take another 10 years to raise a billion, and half the country on fibre will soon dump landlines... extending the gathering of the billion even longer. If it only takes a billion to provide NGA how come BT say it will cost up to £30 billion?
Posted by cyberdoyle over 7 years ago
Also NGA is fibre. Not BET, Wimax, LTE or satellite. anything that isn't fibre is just a bit faster. Korea has 1000 meg. never in a million years can 50meg be futureproof.
Posted by yobrenoops over 7 years ago
People aren't going to dump a phone line for 50p a month.

The £30 billion is for FTTP for the entire country. And its £28.something billion.
Posted by Somerset over 7 years ago
What's the applications for more than 50M?
Posted by themanstan over 7 years ago
Why do you keep quoting Korea and panning BT because they won't do the same?
You do know that the Korean government is spending $24B on this? Also they benefit from double the population density. I don't know any telecom that could afford to do that kind of investment... So start panning the government and regulators, where the problems are!
Posted by AndrueC over 7 years ago
@Somerset:Nonexistent.
Posted by cyberdoyle over 7 years ago
the better the service a country has the faster the kids will innovate and the market will grow. either we do it, or we let the other countries do it and we become the poor relation. koreans download a film in 58 seconds, but here we are happy to wait days or hours, yet pay £30 to sky - if we all had decent broadband our combined bills would be much lower. course sky won't be happy...
we can always stay in the slow lane. but ffs don't think we will have next gen, cos we won't. The copper bottlenecks will remain. holding us back.
Posted by cyberdoyle over 7 years ago
I pan bt cos they tell govt it will cost 28billion. they already own the poles and ducts. and they also tell gov BET is a solution. It isn't. I pan gov and ofcom too. ;)
The job needs doing, and we need telcos to stop protecting their copper cash cow, and govt to stop procrastinating and doing all these damned stupid consultations and JFDI. It is in govt interest to finance it and reap the benefits. The country has virtually ground to a halt with this snow. Kids could be attending lessons via broadband now if it worked. People could be working from home. etc.
Posted by themanstan over 7 years ago
blah blah blah.... every country with great broadband has bad great support from goverenment in the hundreds if not billions of £/$/euros... that is the only way it happens... all the countries mediocre broadband, have governments that demand market model... wake up!
Posted by Dixinormous over 7 years ago
There are other ways to support broadband than throwing government money at it themanstan, and ways to do it when you do. Ask Amsterdam why they invested, it was to make a profit. You'll also find most of these countries with 'great broadband' the investment tends to be in pushing urban areas to FTTP, rather than supplying about 20% with FTTC or similar.
Posted by Dixinormous over 7 years ago
Oh themanstan while I'm thinking about it the Korean government isn't spending 24 billion dollars, the Korean government are footing less than 4% of the cost - 1.3 of 34.1 trillion won - with the other 96% from the private sector. It can't be compared to this though, that is upgrade of urban networks with 10Mbps wireless pushed out to rural areas. Rural areas here will kick and scream at that prospect so *must* be equalised with urban areas, at the tax payer's expense, while urban areas fall further behind our peers.
Posted by themanstan over 7 years ago
I stand corrected, apologies... still, a little over £1B is still the government putting it's money where it's mouth and making an investment in the country for the future...
Posted by Somerset over 7 years ago
So downloading a film in 58s is the best reason Chris Doyle can come up with for 1G.

The government should come up with the money for BT to do FTTx virtually everywhere.
Posted by mishminx over 7 years ago
Half assed, twice the cost and of course at our expense. Still so long as it sounds good then champagne socialists will be happy.

Bread and jam for the masses... Perhaps if Labour win the election they could upgrade it to cheese on toast.
Posted by Dawn_Falcon over 7 years ago
Of course there are Dixi, but BT was not allowed to invest in combined services and they can't offer cable TV services of their own down the fibre pipe.

And yea, they're pushing FTTP in city cores, shame about everywhere else. Gosh forbid that broadband have a wide reach as well as high headline speeds.

But you left the country, and don't have a stake anymore so why are you commenting anyway?

mishminx - So you'd like to, what, cut broadband provision outside the towns?
Posted by Somerset over 7 years ago
Isn't the ISPs, not BT, pushing for areas where they have lots of potential customers for FTTx? Hence starting where VM are.
Posted by AndrueC over 7 years ago
@Cyberdoyle:Several other countries have faster connectivity - we all know and accept that. They've had it for several years now. They are countries with a reputation for technical innovation and development.

So..why haven't they come up with anything better than watching TV?

It'd be nice to think that only the UK could figure out what to do with 100Mb/s but that's crap. Anyone could do it..but they haven't yet.
Posted by Dixinormous over 7 years ago
Dawn, if you read my post instead of assuming that I'm dissing BT and diving in to kiss their arse you'll note I'm not really criticising anyone apart from our government.

Oddly I don't see any FTTP anywhere near me, single exchange in N London and one in MK. No FTTC in this London Borough current or planned either. Must be too far from the 'city core'.

It should also be noted that coverage and high speeds are not, as you regularly claim, mutually exclusive. As I've said many times we advocate a shallow and wide approach which appears to end up with mediocrity for everyone.
Posted by Dixinormous over 7 years ago
Oh this is quite interesting by the way while you're bleating about wide reach, etc.

http://www.oecd.org/dataoecd/22/1/39574951.xls

We have the 5th highest population density and the 5th highest DSL coverage, so nothing exceptional there. It's headline speeds where we drop from that 5th position. Korea incidentally has better coverage than we do.

This ignores availability of other technologies, cable and fibre, both of which are more widely used in many other countries than here.

I can comment if I choose, my apologies if what I have to say is disagreeable to you.
Posted by Dixinormous over 7 years ago
In terms of advertised speeds we come 15th - http://www.oecd.org/dataoecd/22/1/39574951.xls - in terms of achieved speeds this is quite well documented and we are significantly lower than 15th by that measure.

According to the Cisco / Oxford University quality study 31st for quality in urban areas, 28th in rural areas, 48th digital divide, best 3rd of nations as expected given >80% ADSL2+ coverage.

So it would seem to me that headline speeds are precisely the thing we fail on, and I've provided the stats to back it up. Do you have anything besides an opinion to offer to the discussion?
Posted by drteeth over 7 years ago
Any govt could not organise and excess drinking party where beer is made! All they have to do is reduce the tax on laying fibre and pick up the loss if income by the extra VAT generated my people having and wanting a better product. 50p per phone line will not even raise a smile.
Posted by ElBobbo over 7 years ago
Dawn - The restriction on BT's abilities in the television sector was lifted in 2001, see http://news.bbc.co.uk/1/hi/business/1354686.stm. You've been told that before - last time you tried to use it as an excuse - so it's obvious you're being duplicitous. Why should anyone bother to listen to you?
Posted by CARPETBURN over 7 years ago
^^^ Indeed while others provide evidence to back up their claims as you have ElBobbo, others seem to be allowed to randomly LIE
Posted by Dawn_Falcon over 7 years ago
The restriction on BT offering competitively priced triple play services was lifted only in September 2009. There are many news articles referencing this. More restrictions were dropped well after 2001, such as the 2006 lifting of price caps.

All very well documented. I am not the one lying (again).
Posted by Dawn_Falcon over 7 years ago
Dixi - And of course you're cherry picking stats. Headline speeds are not, and have never been, the be-all and end all of services. I could go on, but your agenda against expanding who can get broadband is bluntly old.

That you're now pursing it from another country is seriously eye-raising. (And of course it's nowhere near you, as you said you left the country. Sigh...)
Posted by wirelesspacman over 7 years ago
Dixi - "In terms of advertised speeds we come 15th - http://www.oecd.org/dataoecd/22/1/39574951.xls"

This is the same link as the other previous one (ie coverage not speed).

Correct link is http://www.oecd.org/dataoecd/10/53/39575086.xls

Also, here is a link to the main page showing lots of other stats to chew over!

http://www.oecd.org/document/54/0,3343,en_2649_34225_38690102_1_1_1_1,00.html
Posted by Somerset over 7 years ago
So they looked at 16 adverts and calculated 10M, really useful.
Posted by mikeblogs over 7 years ago
I think overall this is fantastic. NI Gov/BT seem to be getting FTTC to 85% of NI population at a cost of £90 per premises passed. NI Gov deal (£30m) extended FTTC to 128 non llu exchanges (34% of premises), most catorgorised as rural.

It will interesting what impact on long term operational costs this investment will have.

The opportuntity to add apporiate radio at the end of these fibers looks to good an opportunity to miss, thus creating a fixed and mobile data transport fabric.
Posted by mikeblogs over 7 years ago
Has any body seen anything from BT on the small exchanges in Dean, Calder Valley and Taffswell? What's the learnng?
Posted by Dixinormous over 7 years ago
Where I am in the world is irrelevant to my being able to post on here Mr Falcon. I claimed plans to leave, which have been delayed for personal and family reasons not that it's in any way relevant.

What BT Retail were able to do also irrelevant given this discussion relates to Openreach and infrastructure.

Given you claim cherry picking if you have statistics similarly well regarded that disagree I would welcome them.
Posted by Dawn_Falcon over 7 years ago
Of course it's relevant. And right, you lied about leaving. np, just so we have that out in the open.

And of course it's relevant what BT were able to offer retail. ISP's in other countries have been able to pay for their fibre rollouts on the basis of being able to offer multiple services and get a decent rate of return, which BT (unlike any other UK telecoms company) have until very recently been unable to do!
Posted by CARPETBURN over 7 years ago
quote"Given you claim cherry picking if you have statistics similarly well regarded that disagree I would welcome them."

Asking them for evidence is like getting blood out of a stone, pointless and impossible, as is evident by every post they make in every news item. Do yourself a favour Dixi, ignore the idiot.
Posted by Dixinormous over 7 years ago
Well your amusing accusations about my honesty or otherwise aside which I don't have to explain away to you given your pathetic attempt to points score as you can't answer the post in question I again ask for statistics please if mine are so wrong.

BT's TV restrictions or otherwise don't strike me as an issue for Openreach and indeed should not given the two are supposedly operationally separate. Openreach are required to invest on their own returns, not what they think Retail can get out of them.

Still amused you kicked off just because you *thought* I besmirched BT. You're funny :)
Posted by CARPETBURN over 7 years ago
We are not allowed to ask Dawn Falcon for evidence of their accusations Dixinormous doing so is seen as having a bad attitude.
Posted by Dawn_Falcon over 7 years ago
It's a statement of fact, not an accusation. And your attitude is why I don't linkbot things you can find in 5 seconds on google for you.

Of course BT's TV restrictions are an issue.

Without the ability to offer packages, that cuts off one of the major ways in which a fibre rollout can be justified in ROI.

The artificial separation between branches is yet another restriction on BT's ability to operate, right. And then people whine because BT has to respect said limits.

And of course people can ask, Carpet, and if they're polite I'll do it. Wrong *again*.
Posted by CARPETBURN over 7 years ago
blah blah same rubbish new lie
Posted by whatever2 over 7 years ago
Another statement of fact, without actually stating a fact.

Just a troll.
Posted by Dawn_Falcon over 7 years ago
Actually reading Carpet's statement literally he's actually right for once, that is a typical post of his.

:)
Posted by wirelesspacman over 7 years ago
"The restriction on BT offering competitively priced triple play services was lifted only in September 2009"

Ok, taking you at your word...

... would you mind posting a link for this please? I for one thought this had been lifted a long time ago :-)
Posted by CARPETBURN over 7 years ago
Dawn Falcon doesnt link, hasnt mastered the copy and paste function.
Posted by Dixinormous over 7 years ago
The most amusing thing about the whole thing was that the discussion kicked off after I complained about government regulations and lack of support for the private sector to invest along with a little bit of complaining about the perceived digital divide and DF thought I was besmirching BT and leapt in to defend. All amusing :)
Posted by Dixinormous over 7 years ago
Back to the topic I will ensure I have given appropriate feedback. Needless to say I disagree with it on many levels.
Posted by CARPETBURN over 7 years ago
quote"...DF thought I was besmirching BT and leapt in to defend. All amusing :)"

I see nothing amusing about DFs causing other users such as yourself, myself, whatever2, wirelesspacman and many others both in this news item and many others to become annoyed with their dis-information, unproven remarks and bare face lies. The only humour i see is they are so deluded they probably believe half of what they continue to spew.
Posted by Dawn_Falcon over 7 years ago
wirelesspacman - http://www.domain-b.com/companies/companies_b/British_Telecom/20090916_restrictions_2.html

Dixi, you were going on again about how other countries were doing great, without bothering to research *why* those particular fibre services are economic to roll out.

It's the same old attack. It never varies. You can drop the pretence now.


Carpet - Oh look, a link. Wrong *again*. And no, other people are not multiple personalities, I know you've said that you are but this is not generally applicable. Wrong *again*.
Posted by ElBobbo over 7 years ago
What you said was "...they can't offer cable TV services of their own down the fibre pipe."

BT have been able to provide cable TV services down a broadband connection since 2001, and they have done with BT Vision since 2006 through a DTT/IP/PVR set top box that uses streaming over broadband.

Preventing BT from providing a bundle discount with line rental given their overwhelmingly dominant position is not the same.
Posted by Dawn_Falcon over 7 years ago
"Was", ElBobbo. Past tense.

Overwhelmingly dominant? Oh right, "limiting their investment in the future". Gotcha.
Posted by wirelesspacman over 7 years ago
@ Dawn_Falcon

Many thanks, appreciated.
Posted by Dixinormous over 7 years ago
No Dawn I didn't say anything about why other countries were doing great I suggested that there were alternatives to mass government investment and mentioned that they tended to consist of pushing FTTP to urban areas rather than wider reach of other products and mentioned that it's difficult here to do that due to the perceived 'digital divide' but whatever.

Again, Openreach are required to invest in plant upgrades depending on feedback from BT Wholesale and LLU operators not BT Retail.
Posted by Dixinormous over 7 years ago
If you would read http://forums.thinkbroadband.com/general/t/3777704-re-former-lord-calls-landline-duty-a-new-poll-tax.html you would note I'm actually all in favour of reducing barriers to investment.

My post to stan pointed out that the example he gave was incorrect and that the Amsterdam muni project is there for profit. I also pointed out that we have issues with digital divides here and it being almost rude to suggest urban areas be allowed to excel.
Posted by kijoma over 7 years ago
I have corresponded with the people behind this consultation and they have declared that ONLY fibre will be considered for funding as they don't consider wireless and other mediums capable of NGA.. the document of course shows they never consulted any of the high speed NGA capable providers outside Fibre and instead included "wifi" community mesh , a sure fire way to justify the argument they are putting forward.
Posted by kijoma over 7 years ago
..... So whatever tax is levied on the people, it will contribute to potentially pushing Fixed wireless providers out of business as they will have to provide their service unsubsidised.. well done for joined up government. ho hum.
Posted by ElBobbo over 7 years ago
Dawn - I don't know what tense you think "they can't offer cable TV services of their own down the fibre pipe" is - and take this from me, it's not past tense, regardless of how delusional you are - they're only just rolling out fibre products... good try at covering yourself though.

As Dixinormous has pointed out - and you've ignored several times - "Again, Openreach are required to invest in plant upgrades depending on feedback from BT Wholesale and LLU operators not BT Retail." BT Retail is treated like any other ISP by Openreach/BTW.
Posted by ElBobbo over 7 years ago
kijoma - do you see wireless as being NGA? What solutions would you propose that would qualify?
Posted by CARPETBURN over 7 years ago
Dixi, ElBobbo give up its now also clear DF cant even recall exactly what they stated.
Posted by mikeblogs over 7 years ago
Given most connectivity constitutes a cable and a radio at the end, then there is room to interpret.

If I can pushing a Cable through duct and feed a village, then what I use at the end of that ought to be anything that can make connectivity better.

I would hope it should include whatever is available, copper and radio at the minimum. It should not be designed to limit our use of the available medium.
Posted by quenticimo over 7 years ago
I don't have mains gas, so can all gas users be charged 50p so I can have mains gas in my house?
Posted by Dawn_Falcon over 7 years ago
Dixi - Yes, and those alternatives require a company able to offer them at a competitive price. The UK system is *set up* such that if you want mass FTTH, you need government money.

It's beyond me why you defend that.

ElBobbit - So you don't recognise "was" as a word. Most interesting.
Posted by ElBobbo over 7 years ago
"Can't" is not "was". Can't is present tense.
Posted by Dixinormous over 7 years ago
Dawn - I don't defend it. I want the UK system changed. A combination of market-lead FTTH in the urban areas alongside local municipal networks with regulatory and practical barriers to both such as business rates on fibre and the complication and cost of gaining permission to do civils removed.

An acceptance that 'mass' FTTH is, in the short term, not possible would also be useful. It will be confined to urban areas bar local municipal actions.
Posted by Dawn_Falcon over 7 years ago
Well yes, I want a market-lead approach as well, which is why I oppose regulations specifically aimed at any given company.

And I'm certainly not going to argue with the issue of civil access (some councils are routinely rejecting anything but critical work!)

Afaik, though, I'd rather have 90% FTTC than 50% FTTH.
Posted by Dixinormous over 7 years ago
If the government deal with the regulation and the ridiculous artificial barriers along with an appropriate regulatory framework for any NGAs and guidance to local areas who may wish to do their own thing there is no real pervasive reason why 80+% FTTC *and* 25%+ FTTH isn't quite feasible.
Posted by Dawn_Falcon over 7 years ago
Of course there is. We've gone over and over this - FTTH requires certain market conditions which don't exist here OR government funding in some form. Regardless of regulations.
Posted by kamelion over 7 years ago
DF What you propose is an oxymoron. You can't lead the market by sitting back you have to innovate.

I don't have the figures to hand but I'm sure that if VM didn't think there was a market for 50meg+ BB they would have just sat back on their 20 meg product and waited until they had reduced their debt a little more.
Posted by Dawn_Falcon over 7 years ago
And the market works on ROI, not wasting cash on products which because of market conditions are a net loss. That's what the BT-only regulation has produced here and now.

VM are interested in pushing headline speed figures, and most people on overloaded UBR's are lucky to see a fraction of that speed.

There's a reason they are losing market share!
Posted by Dixinormous over 7 years ago
VM's market share is largely dropping due to their being almost exclusively in saturated areas, growth is slowing across the board but is slower in urban areas.

The thoughts on viability of FTTH are purely your opinion. It is certainly viable in some areas for example the millions of homes in London with no cable. BT certainly appear to consider it viable in some areas given they have increased their brownfield FTTP deployment. Regulation reduction will improve the maths even more.
Posted by Dawn_Falcon over 7 years ago
VM's market share is dropping because they are offering a sub-par service compared to LLU ADSL2 broadband.

And if you can come up with a counter-example to my "thoughts" on FTTH rollouts, I'd be glad to see it. BT are deploying it on a VERY limited, cherry-picked basis.
Posted by CARPETBURN over 7 years ago
quote"VM's market share is dropping because they are offering a sub-par service compared to LLU ADSL2 broadband."

Dont agree with you often but must agree with that. LLU ADSL2+ for people close to an exchange is also much better value than 20 and 50Mb services from virgin. Considering 20Mb from virgin will cost you £20 with extra for virgin phone or £30 with no virgin phone service and they limit thruput at certain times, if you dare use your connection too much its not exactly good value compared to some LLU
Posted by CARPETBURN over 7 years ago
As to others and all this persistant FTTH talk, for most its not gonna happen so get over it.
Posted by Dixinormous over 7 years ago
I can't say I agree that 50Mbit for 28GBP a month with no limits or throttling is poor value, or the opinion that VM offer substandard service relative to LLU ADSL2+. It's hard to say LLU close to the exchange is better value than 50Mbit from Virgin as there simply isn't a non-FTTC service that matches up to its' downstream. Still, YMMV.
Posted by CARPETBURN over 7 years ago
quote"I can't say I agree that 50Mbit for 28GBP a month with no limits or throttling is poor value,"
Except thats the price for the service with an additional £11 a month phone service from them so its not really £28. (Extra is also charged for non Direct Debit payment) The 50Mb will have limits applied sooner or later (they said they were not going to limit 10Mb, then they said the same about 20Mb, so 50Mb and no limits... yeah FOR NOW) All virgin services vary, some areas are terrible and unable to give more than 10Mb at best, walk round a corner though and the next street gets full speed.
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