Broadband debates are often now the most scintillating event and many
conferences feature the same faces, but the House of Commons Committee of
Public Accounts session in July 2013 was the exception. BT and the BDUK itself
got a firm talking to and while the meeting lasted nearly
four hours there was still lots of discussion needed. Now we have the copy
of the Twenty-fourth Report for 2013-2014 from the Committee entitled The
rural broadband programme, which should be on the must read list for all
those campaigning for better broadband, politicians and those working in the
Update 8:45am For those that want to read the report
themselves, it is available online
now and includes transcripts from the streamed committee session.
Several recommendations are made in the report, whether the Government pays
heed is of course another matter:
- The Department (DCMS) should not spend any of the further £250 million of
public money until it has developed approaches to secure proper competition and
value for money for improving superfast broadband after 2015.
- The Department's (DCMS) assumptions in its 2011 business case about the
respective capital contributions of the public and private sectors were widely
inaccurate. Before contracts are awarded for additional broadband coverage from
2015, using the additional £250 million, the Department should improve its
modelling work, and when negotiating levels of private sector investment, the
Department should push for contributions that take account of the long-term
value of the assets to the supplier.
- The Department should insist on a higher standard of cost transparency
before contracting. Where contracts are not yet signed for the current
Programme, the Department should secure BT's agreement to improve cost
transparency, for example by omitting the non-disclosure agreement between
- The Department should set out how it has assured itself that local
authorities will be adequately resourced and supported to carry out adequate
checks on BT's costs and take-up rates during the project.
- Overall, BT is supposed to deliver at least 90% coverage in rural
areas but the Department did not secure sufficient transparency from
BT about precisely where it intends to roll out superfast broadband within each
area. The Department should, as a matter of urgency, publish BT's detailed
roll-out plans so that other suppliers can get on with trying to reach the
remaining 10% of the population that will still be without superfast
- As part of its current review of the broadband market, Ofcom should
explicitly address the impacts on competition of BT's wholesale pricing
structure and of the terms and conditions attached to accessing BT's
infrastructure. (tbb Note: It is believed this is referring to PIA (duct and
pole access rather than VULA, i.e. GEA-FTTC/P products)
With the main BDUK roll-out very much underway, there is little that can be
changed without introducing delays, but reading the full report from the Public
Accounts Committee there are various assumptions and misconceptions that have
very much now entered into the area of because it was said at a Committee it
must be 100% true. Some examples are:
- Overall, BT is supposed to deliver at least 90% coverage in rural
areas: This is not what the BDUK project was meant to achieve, some believe
the goal was 100% coverage at superfast broadband speeds, but research
indicates that apart from one document where you can see how some people have
interpreted what was meant to be a description of the Universal Service
Commitment has been taken to refer to speeds significantly faster. The BDUK
project was often called the final third project earlier in its life,
reflecting its aim of building out from the mainly urban commercial roll-out
(which sits at 73% currently) to making superfast available to 90% of the UK
and 2 Mbps as a baseline to everyone else.
- The Department forecasts that it will complete the Programme in March
2017, 22 months later than originally planned. is quoted several times and
is largely based on the National Audit Office report and the latest DCMS estimates say 95% by 2017. The 90% target is
likely to be late by 12 months, not 22 and the 95% target cannot be late as no
money has been allocated to meeting it yet.
- The report title is misleading, The rural broadband programme,
particularly with the 90% target for superfast broadband. Ofcom states that 14%
of the UK population is rural, 51% are semi-urban and the remainder urban.
Generally the BDUK roll-outs to date have helped the semi-urban population on
the edges of towns and there are several cities accessing the fund. A clear
definition of what is rural/urban we would have thought key to understanding
the costs involved.
- The lack of mapping data from BT and the councils. There is an increasing
amount of mapping information from the projects and if you take time to look at
the dates these appear generally it is a few months after the contract was
signed, i.e. one BT has actually started working with the local authority.
Potentially the BDUK could force BT to publish its own model for a county at
the time of contract signing, but this removes flexibility and with unknowns
like ability to get planning permission for a location for a chamber/cabinet
and the cost of power supplies. One side to this are that it allows BT
flexibility so that if one cluster of homes is very expensive to at the full
planning stage to prioritise spending elsewhere where it can serve more
households and businesses. The flip side is that it can allow BT to adjust its
plans to react to previously unannounced roll-outs and act as a vampire death
squid (to borrow an illustration from the committee meeting).
- The report glosses over the varying targets across the UK, some counties
signing contracts covering work till 2017 and 100% superfast coverage already,
and others going for greater than 90% and some aiming at below than 90%. To the
extent that someone using just that report to assess the UK broadband picture
could be misled.
At the end of the day the Government announced the amount of money it
wanted to spend for a target and the risk appears to be on BT to meet that
target. The experience from Digital Region has made the Government and Councils
very risk averse and other projects where subsidies have been provided to bring
service to an area for an operator to withdraw once funding runs dry. The most
overlooked aspect of the BDUK process, is that the money is £230m of surplus
from the Digital Switchover Fund and £300m from the TV licence fee, with the
money for 2015 onwards also coming from the licence fee.
The example may be extreme, but essentially what we have is a triage system
working to try and deliver a target and there appears to be no extra resources
on the way, so its try and spread out what is available to cover the widest
In a traditional situation the Government would have waited for the
commercial roll-outs to complete and get a better idea of what take-up levels
were, but the rapid growth in the digital marketplace meant the pressure was on
to do something sooner rather than later, and it could be said that the decade
of lobbying by campaigners finally got through to the politicians, but not with
the result that pleases everyone.
There are various high profile what-ifs raised by the report, e.g. £150m of
lost investment in North Yorkshire from UK Broadband, and Fujitsu saying they
might invest £1.5 billion. The problem here is that the Fujitsu bid relied on a
much larger project size, apparently requiring around four counties to get the
volume required and the mixture of technologies was unclear (supposedly FTTH to
80% coverage - and other technologies beyond there) and with the UK Broadband
bid for most people this committee meeting will be the first time they have
heard of them. UK Broadband is behind the 4G LTE fixed wireless network in
Swindon, which based on complaints about broadband in the
area may not be available on the large new build estates.
Sitting in the middle as we do, we can see on one hand those wanting the
best technical solution no matter what price or effort is required and the
majority of the public who just want to know when they can order off
their existing supplier. Perhaps we should ask how much the report has
cost to create, and what are the cost implications for the changes they
For all the problems there are with BT, it is clear that some County
Council's are able to do things differently, e.g. the use of fixed wireless in
parts of Lincolnshire, some have used satellite broadband for the areas they
are likely to reach last with their project and the widely varying levels of
information from them. The 21st century rally cry is really 'we want our
broadband and we want it now'.