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EU poised to give state aid approval to BDUK projects
Monday 08 October 2012 09:15:54 by Andrew Ferguson

The Financial Times has learnt that at least one EU commissioner is happy for state funds to be used on the BDUK projects and the approval of the others is likely during October.

Joaquin Almunia, the European competition commissioner has indicated that all that is needed is some relatively minor changes to the schemes design and it will tick all the boxes and receive its rubber stamp.

The State Aid hurdle has been delaying work on the BDUK projects, though some such as North Yorkshire have received approval already. While the FT suggests that some areas are well ahead of the others, the reason for this is mainly because the advanced local authorities were those announced as phase I & II trial areas.

One recurring theme amongst coverage of the BDUK projects is that it is often called a rural broadband project, when the reality is very different. The aim is to extend superfast broadband coverage to a minimum of 90% of the UK, from the commercial promise of 66%. As we cover on page 6 of our broadband factsheet only 13% of the UK live in what the EU define as rural areas, the vast majority of those to receive superfast from the BDUK projects will be people in the suburbs or fringes of cities (27% of the UK is considered to be living in suburbs and 60% in urban areas). Some projects are pushing very deep into the final 10 percentage points of coverage with superfast speeds, but this coverage in excess of the national target depends very much on individual negotiations with BT, and the level of funding the authority wants to make.

The true rural broadband projects are those getting funding from the much smaller £20m RCBF (Rural Community Broadband Fund), which is targeting the hardest to reach parts of the UK.

Hopefully as part of the demand stimulation schemes in the projects, local authorities will insist on better information being made public on roll-out timetables, in our recent poll on this a 61% rated the current Openreach information as confusing or not helpful and 89% wanted more granular information i.e. on specific cabinets. If local authorities can get good take-up levels then depending on the precise contract there is actually a possibility they will claw back some of their investment, which could be re-invested to push coverage closer to a full 100% at superfast, rather than the mediocre 100% at 2 Mbps which is the current goal.

Comments

Posted by WWWombat over 4 years ago
The report on the pilot projects shows that it is vital to get both residents & businesses to engage in the demand for decent broadband.

It also shows that the authorities under-estimated how time-consuming this was.

Yet demand - and subsequent take-up are vital for helping get NGA deeper & deeper into the country.

Report: http://www.culture.gov.uk/images/publications/BroadbandPilots_lessons_learnt-Dec2012.pdf
Posted by Bob_s2 over 4 years ago
The wway to get Boadband to the non commercial areas should be a mixture of driving up demand and subsidy. A danger with subsidies though particulary with a monopoly operator is there is no real incentive for them to drive down costs

At present there has been little focus on driving up demand in rural areas

Posted by GMAN99 over 4 years ago
How can you drive up demand? If it isn't there it isn't there
Posted by Spectre_01 over 4 years ago
Drive up demand by using overused buzzwords, much like Bob's post.

Real life, unless your going to build more council estates and connect them to the un-economical cabinates and give the people living in said estates more benifits so they can afford faster internets then...
Posted by WWWombat over 4 years ago
I guess the point of this kind of report is for the mainstream BDUK projects to learn from the pilots - that driving the demand *is* needed, is key, and is harder than thought.

Another aspect of the report is that, currently, businesses don't understand what they can do with the increased capacity, and need to be taught. If you can show a direct line from capacity to profit, the businesses will certainly "demand".
Posted by andrew (Favicon staff member) over 4 years ago
Demand stimulation is actually a requirement of getting the state aid approval, to avoid totally unused projects being built, that look good, sound good but no-one uses.
Posted by New_Londoner over 4 years ago
@Andrew
What like the giant vanity project that is the South Yorkshire Digital Region?
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