Skip Navigation


Community chooses Openreach and raises £15,000 of gap funding
Wednesday 10 December 2014 11:04:56 by Andrew Ferguson

ISPreview spotted an interesting situation, where a village that has just entered the demand led registration scheme for Gigaclear Gigabit FTTP has actually chosen to pay Openreach to bring superfast fibre based services to the village of some 120 homes.

The village website includes some more detail, and that among the 120 households the target of £14,800 was raised in under four weeks. An October newsletter reveals that the figure needed would have risen to £47,000 if the contract had not been signed quickly, since there are efficiency savings if the village is enabled at the same time as existing plans for Medbourne where the actual exchange is based.

We believe the roll-out is an FTTC based one which should be available in the 2nd quarter of 2015, and the wording from the newsletters suggests that the ability to choose from various retail providers was a key driver for some and also the worry that across the Gigaclear demand area that the 35% registration level would not be reached and it might therefore be 2017 before they see improvements.

"After the open Market Review in May 2014 Northamptonshire County Council granted Gigaclear permission to provide FTTP (Fibre to the Premises) to Ashley and other Northamptonshire Villages in the Welland Valley on a commercial basis. That decision precluded us from getting any money from NCC to fund the funding gap of £14,800 which we are presently trying to raise so that BT’s OpenReach can provide our entire village with FTTC (Fibre to the Cabinet) superfast broadband."

That decision by NCC gave Gigaclear a 3 year window of opportunity for them to secure the 35% interest that they require to make a viable installation in the Northamptonshire part of the Welland Valley.

We understand that Gigaclear will be dropping their sales and marketing literature through both our doors and other Northamptonshire villages in the WVBG to ascertain whether they can secure that 35% interest. If that level of interest was achieved and if residents wanted the services of Gigaclear after they had laid cables through the village, a connection fee of £100 would be payable by each resident requiring the service then an optional minimum of £95 to connect the service to our property depending on the distance our houses are from Gigaclear’s street connection points

If they fail to secure the 35% level of interest needed, they will at some point during their 3 year period of opportunity inform NCC of this. When that decision would be made is uncertain but once taken it would then trigger another Open Market Review by NCC.

Extract from Ashley October Broadband Update

The village appears to be ideal for a FTTC roll-out, as it appears the cabinet is centrally located and every premise served by it is within 500m so should get very good speeds of more than ten times the current 3 to 4 Mbps they experience.

Comments

Posted by WWWombat over 2 years ago
The availability of a variety of retail ISPs seems to be a key driver within the North Yorkshire BDUK project too. It seems to be a crucial requirement to achieve significant buy-in by the public.

It demonstrates that altnets have a huge hurdle to overcome. People have to be really pretty certain that they will *never* get a service with a choice of ISP before they choose a serious lock-in - even if the service offered is extremely capable.

I wonder how much the funding differential played here - £123 per property to fund a cabinet, vs the £195 installation fee for Gigaclear.
Posted by ValueforMoney over 2 years ago
So £14.8k for a cab and fibre (1-2km?) back to the exchange, that's ok as BT contrib for 120 homes will be small. So what economies of scale drive the price from £47,000 to £14.8k? The spine and handover point are already in.
Posted by WWWombat over 2 years ago
The latest newsletter shows a bunch that are very happy to retain access to the "free market pricing".

They are also not happy at the lack of support from Northants CC: perhaps because giving Gigaclear the right to seek a level of interest also locked out the ability for NCC/BDUK to fund any of the project.
Posted by TheEulerID over 2 years ago
@VFM

That difference is huge isn't it? The cynic might think it's exaggerated to encourage a decision. I imagine there might be savings in coordinating surveying, roadworks, planning, workforce availability, project management but £30k+ is a bit of a stretch.
Posted by WWWombat over 2 years ago
@VFM
Good question.

Whatever the reason, does it further show that splitting BDUK into two or three projects might have added serious costs because of similar discontinuities? Logically, you'd say it has to.
Posted by TheEulerID over 2 years ago
@WWWombat

There's also a big problem with those Altnets in receipt of public money, like Cotswold Broadband. To comply with EU state aid laws, they have to provide wholesale services, but that's a huge system integration issue for retail providers if they have to deal with many small providers, each of which has only a few thousand customers.
Posted by TheEulerID over 2 years ago
It's also extremely interesting to see the impact of OMR where a commercial interest was declared and granted. I assume that commercial plans have to be credible, but it also looks like they can also be conditional (like the 35% takeup threshold).
It's notably B4RN apparently didn't make any OMR submissions (hence the "double FTTP provision" issue that has arisen in one village).
Posted by fastman over 2 years ago
it is also very dependant on which way the spine routers from the headend to the serving exchnage ie Route A does not go past the Village (you then have to get to the vilage from the exchange) - route B goes past entrance to village and can you intercept it (there could be massive differences in those figures depending if it A or B
Posted by TheEulerID over 2 years ago
@fastman

Good point, we forget these things are interlinked and if they are planned separately as different projects you can get very different solutions. It may well be the cheapest way to enable Melbourne individually would make it much more expensive to enable Ashley as a separate project.
I bit like FTTP being much cheaper per property than one-by-one implementation using FTTPoD.
Posted by ValueforMoney over 2 years ago
@fastman - but total spine cost is still divided by as many cabs in a 40km radial distance from a nominated handover point as is possible to squeeze. The routes from exchanges to handover points ought to be in reasonable nick.
The £2.5bn became c£1.3bn because it was cheaper and easier and the FTTP target disappeared. This is why £15k makes sense while an average subsiy of £40k+ does not.
Posted by WWWombat over 2 years ago
@Euler
Agreed. I think one of the "£10m innovation fund" projects is about a wholesale platform for wireless ISPs, so we know concerns have risen to central level.

I think it was also mentioned (by the local BDUK project) as an aspect in the IF project given to NYorks - which is headlined as a way for Airwave to try out 4 different wireless projects.
Posted by WWWombat over 2 years ago
@VFM
Remember that the £15k is a differential for just the one cabinet, added to a project that is otherwise already adding both spine and headend into the area.

Your so-called £40k average includes the money for headend and spine in the first place.

(And that £40k average is only valid within one county; while that county is anything but average within the country)
Posted by WWWombat over 2 years ago
Oh ... and every property is within 500m. They'll all do pretty well once vectoring is here.

They did tick the box asking for vectoring to be installed from day 1, didn't they?
Posted by MCM999 over 2 years ago
@WWWombat "The availability of a variety of retail ISPs seems to be a key driver .... It seems to be a crucial requirement to achieve significant buy-in by the public." It is for exactly that reason that our development of 75 EO lines in central London went for BT at a cost of c£18K inc VAT rather than Hyperoptic whose quote was less.
Posted by TheEulerID over 2 years ago
@WWWombat

That makes sense. I did wonder about the possibility of a common broker system for Altnets to which they and SPs could subscribe. Not an easy thing to do, as it will need abstracted models for billing, configuration, problem reporting, orders, changes, ceases and much else. These issues are non-trivial and unless they are bought under control there will be untold problems in the future.
Posted by mdar5 over 2 years ago
Gigaclear were going to partner up with Fluidata to provide for access to other ISP's over their fibre network.
Never heard anything more about it so one presumes either it is still 'work in progress' or has been quietly dropped.
Posted by ValueforMoney over 2 years ago
@MCM999 Did 75 EO lines involve inserting a VDSL cab for £18k including VAT, or was FTTP offered? Could you post your invoice for others to see. EOL changes are commanding a premium when paid for by the state.
Posted by fastman over 2 years ago
VFM network rearrangement is determind by how diverse the EO clusters ae and where the Fibre and Copper is located -- one size does not fit all -- these are bespoke engineering challenges and each once needs to be looked at (in BDUK its about max premises for X envelope
Posted by TheEulerID over 2 years ago
The other thing that might impact on this is the take-up rate. If those 75 lines at all signed up for FTTC, then that could make a difference to the financial calculations.
Posted by ValueforMoney over 2 years ago
@fastman sure - but £18k minus 20% VAT= £14,400 which includes copper re-arrangement perhaps on a single 100 pair cable, plus cab (2 cards) power, tie cables, plynth, connection back to exchange and habover point
So this is good and Openreach need to be appluaded.
I have seen the same in rual - 1x100 pair cable, guaranteed 60 customers for £30k which was also good as it needed work to handover point and power was an estimate.
But this is light years away from the milestone payments imposed by BT Group on BDUK.
Posted by TheEulerID over 2 years ago
Another price point, is Islip in Oxfordshire. Their community funded contribution was £11,000 to enable a cabinet. I think Islip roughly the same size.

http://www.computerweekly.com/news/2240176052/Islip-puts-up-cash-for-fibre-broadband
Posted by ValueforMoney over 2 years ago
@fastman sorry habover should read handover, and rual should read rural.
I have also got quotes for single site multi tennant location in London for £35k, but there are private circuits revenues to protect so I guess that increases the cost.
Posted by fastman over 2 years ago
eulier islip is a bit different they were lucky they had fibre close but they are a much bigger community than you would expect
Posted by fastman over 2 years ago
VFM gap will be gap based on the specifics and premises -- dont hing other revenues come into this as that is a community engagement direct with openreach
Posted by fastman over 2 years ago
VFM the gap will be ex VAT
Posted by ValueforMoney over 2 years ago
@TheEulerID and Iwade Kent was £13k for a extra FTTC cab and extension. Rural ELO costs, (copper arrangement + cab power outside exchange building, were quoted in evidence to House of Lords at £30k a go (£90k for 3) by Rory Stewart MP and cohorts. This was deepest Cumbria.
Posted by ValueforMoney over 2 years ago
@fastman I look for evidence of any gap being paid and have been unable to find a reference anywhere in BT slides.
I understand BT capitalisation of labour at c60% (half direct and half indirect) is the highest of its peers in Europe so seeing how the gap is calculated would be interesting.
Posted by ValueforMoney over 2 years ago
@fastman - the £35k ex VAT quote was a community effort with 100+ tennants, 5 of whom had bought private circuits to get more than 10 Mbps data path - ADSL was 1-2MBps. The BT request has to cover the potential loss of that PC revenue however it is presented. Re-arranging copper and supplying VDSL cabs is not a regulated market.
Posted by themanstan over 2 years ago
@VFM

I don´t think any of BTs peers in Europe have been required to create a subsidiary company of their infrastructure division, this does load up the costs through duplication.
Posted by fastman about 1 year ago
VFM what the community have in terns of current view has no effect or impact -- however miuch you migh like think - the gap is the gap is the gap
Posted by ValueforMoney about 1 year ago
@Fastman the gap is the gap.. so your a tease as well. No problem with the Openreach quotes with or without gap, but their is a problem with the BDUK milestone payments.
Posted by fastman about 1 year ago
prviate funding is nothing to do with BDUK and no public money is involved
Posted by snaylor about 1 year ago
To clarify on behalf of the County Council, Gigaclear's plans were not 'granted permission' by NCC, they were assessed as credible as part of an Open Market Review process of all commercial telecoms interests in the county. This informed our State Aid Public Consultation on the Intervention Area for the next stage of Superfast Northamptonshire. Public funds should not be invested where there are credible commercial plans. NCC welcomes private telecoms investment & competition in Northamptonshire from operators who can help us move closer to our full coverage target for superfast broadband.
Posted by Gadget about 1 year ago
I think the difficulty might arise in what is defined as a "credible plan" by one might be a "shot in the dark" to another. For my money a credible plan has a commitment to deliver not predicated by any demand constraints. I can imagine the disappointment in Ashley if, after 3 years of waiting they only reach 34%, not securing a firm commitment to build by Gigaclear and having had BDUK in all its phases pass them by.
Posted by ValueforMoney about 1 year ago
@Fastman Indeed but the components are the same and state aid conditions for GAP funding means there should a relationship between the two.
Posted by rtho782 about 1 year ago
I may be missing something but why would one care about multiple retail providers reselling the same service, over a technically superior product.

It's like Jaguar offering to build a dealership with enough interest, but instead paying £15,000 for Ford to open a dealership nearby that sells nothing but Ford Mondeos with a choice of Ford, Citroen, Peugeot, VW, or Audi badges stuck on the front.

Meanwhile, the Jaguars are no more expensive than the "Fords" and perform much better.
Posted by Michael_Chare about 1 year ago
35% is a very high take up rate. More than Gigaclear have wanted for other projects. Gigaclear want a connection fee of £100 which includes a router and a cable. Then you can either pay Boxcom to complete the installation to a property which is likely £95 or more or take a DIY approach. They did well to raise the £14,800 so quickly
Posted by MCM999 about 1 year ago
@rtho782. "I may be missing something". I believe you are. Try getting people to not only pay up but also to move from their pet ISP be it Sky, BT, TT, EE, Plusnet, etc., each with their own assorted offerings, not just a connection, and getting everyone to agree to dump their existing ISP and move to an unknown (to them) provider with little or nothing to offer above a fast connection. I can assure you it's difficult if not nigh on impossible.
Posted by mdar5 about 1 year ago
And you can add into that mix that they would loose their ISP's email which many average consumers still have.
Plus the point that people know that installation of FTTP across verges and gardens causes mess.
It all just adds up on the aggro front.

Posted by cyberdoyle about 1 year ago
Their money, their choice. I just wonder if they know what opportunities they have lost. They could have speeds like this http://www.pinterest.com/pin/126734176988539702/ for less money than infinity will cost them. And there is no upgrade path for them if they settle for cabinets. They may be ok for now, but the future is fibre. Not old phone lines. Just sayin.
Posted by TheEulerID about 1 year ago
@cyberdoyle

Do you think most of the residents care about boasting rights on speed? They now have a pretty well cast iron guarantee of decent broadband by May next year (and be sure somebody's neck will be on the line if it isn't there on time).
It may not be the sexy option, but it's the safe one. From the size of the village, it looks like most will be able to either get 80mbps, or close to it. If/when vectoring arrives, 100mbps might be on offer. Good enough for most.
Posted by Gadget about 1 year ago
@CD - I think they did understand what was on offer since their local news item indicates that Gigaclear presented to them:
http://www.ashleyvillage.co.uk/images/Broadband/Ashley%20Broadband%20Update%20-%2010%20October.pdf
Posted by MCM999 about 1 year ago
@mdar5 In our case it would have meant Hyperoptic running Ethernet cables across the front of all the houses plus in two places the cable would have crossed internal roadways on catenaries.
Posted by herdwick about 1 year ago
Gigaclear also declared a commercial interest in the Kings Cliffs area of Northamptonshire where a small shed exchange only offers Upstream albeit in the main at >5M sync but with many reporting contcontention issues at peak time.

The BDUK project wasn't going there and Gigaclear hit their sign up target aand have started ripping up pavements
Posted by herdwick about 1 year ago
IPStream of course not upstream!
Posted by WWWombat about 1 year ago
@MCM
Where you more pro-Hyperoptic or pro-BT yourself? How much weight do you think your voice had with other residents?
Posted by MCM999 about 1 year ago
@WWWombat. An interesting question and one difficult to answer. Initially Hyperoptic as they were initially the only ones to come forward but from the start was worried about how they were going to route the Ethernet around the development. BT then came on the scene (thanks Andrew) but wanted £25K plus VAT against Hyperoptic's £20K or so ...
Posted by MCM999 about 1 year ago
.., at a resident's meeting in Nov 2013 there was little support for faster broadband and I stopped working on it. Hyperoptic came back mid-year with new proposals and improved infrastructure. I posted some details here and was contacted off-list by a BT staffer who said he felt the £25K+VAT was an error. I became involved again and a new BT proposal using a 96 port All-in One cab was proposed at £15K plus VAT. ...
Posted by MCM999 about 1 year ago
.. I then again stood back leaving matters with our agents (we own our site and employ agents to manage the development). At our recent AGM shareholders who had previously been negative towards the proposals raised the subject and it was back on the table. In truth I just want to see faster broadband, the majority, no all, of the shareholders wanted to go the BT route due to a) choice of ISP, b) minimal external works. I "found" the money (I manage the development's finances) and BT won.
Posted by MCM999 about 1 year ago
To conclude. I lobbied for faster broadband, I liked the idea of FTTD (D = Development) but was concerned about the visible infrastructure involved with Hyperoptic. What I think determined the outcome was that by going BT nothing need to change with the properties and each user could upgrade their connection via their ISP when wanted. Me. I just want a decent connection. :-)
Posted by Scuffers about 1 year ago
Just to update this story, Ashley's cab is not installed and working (all be it with some delays due to planning etc.)

Personally, gone from ~5M ADSL Max to 76M FTTC (and Openreach will be enable Vectoring shortly)

In the mean time, still no sign of Gigaclear doing anything other than advertise.
You must be logged in to post comments. Click here to login.