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Virgin Media lobbying DCMS for changes to superfast city projects
Monday 03 December 2012 10:34:51 by Andrew Ferguson

Both BT and Virgin Media have objected to the granting of EU State Aid for the Birmingham super-connected city project, and it appears Virgin Media is now lobbying the culture secretary according to City A.M.

Virgin Media wants changes made to the way the projects operate, namely that they prove this is un-met demand for the networks and help businesses to exploit the fast networks that are already available in the area.

As the super-connected city projects require EU State Aid approval demand registration and identification of what is commercially available now and likely to be for the next three years are in theory already a pre-requisite, though in the case of Birmingham this still appears to have resulted in a project that at least partially overlaps the existing Virgin Media footprint.

While Virgin Media obviously would stand to gain from making businesses more aware of the existing broadband options, there is also the sense that if all the super-connected cities follow the route of Birmingham and create ultra-fast Gigabit enabled enclaves, that over time businesses will move to these areas, the end result being migration inside the city, reducing business for commercial operators making further commercial investment less likely.

The Autumn statement on 5th December is expected to announce which 10 cities have won a share of the £50m funding, so it seems unlikely much will change in the 50 hours or so before the statement is released.

The recent free WiFi project in Leeds and Bradford also shows that millions are not actually needed to improve aspects of service in the cities and that commercial providers have not given up on cities.

Comments

Posted by herdwick over 4 years ago
I'm no fan of VM (especially their advertising) but I do agree that we shouldn't be taxed in order to provide "council broadband" - with debatable value for money and probability of success - if adequate commercial services are already available.
Posted by chrysalis over 4 years ago
is VM adequate tho?

Personally if I was in a business premises I wouldnt touch VM with a barge pole.
Posted by andrew (Favicon staff member) over 4 years ago
Virgin Media business does much more than just sell DOCSIS 3 services, it can do proper fibre leveraging the duct network that Virgin Media has in theory.
Posted by Kushan over 4 years ago
I'm probably being incredibly naive but I fail to see what the problem is. Is Virgin just throwing their toys out of the pram because it means someone's competing with them?
Posted by andrew (Favicon staff member) over 4 years ago
@kushan A big part of State Aid rules is that it is NOT meant to be used in areas unless there has been market failure.

Whether city centres have had market failure in this respect is a subject open to discussion.
Posted by WWWombat over 4 years ago
I thought the super-connected funding was for ultra-fast services, not just super-fast.

Surely, then, this is about market failure at the 100Mbps+ level - and of services at this speed targeted at mass-market, not one-off leased-line prices.

After all, super-fast *today* qualifies for state-aid in places, even if plain broadband speeds are available, and even where leased-lines could theoretically be ordered.
Posted by WWWombat over 4 years ago
Oh - and VM has a nice little get-out clause in providing business broadband that says "* Our cable business broadband is only available to premises that are already receiving cable services from us or these services have previously been provided to those premises."

I'm not sure that the attitude is quite right there...
Posted by andrew (Favicon staff member) over 4 years ago
Virgin Media offers 100 to 120 Mbps which is ultra fast and Openreach has its FTTP on demand at 330 Mbps previously announced and on its way in 2013.

Also seen as VM Business is offering 1Gig to 10 Gig it is doing a lot more than just cable DOCSIS broadband.
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