While the Summer 2015 Budget was a bit of a non starter in terms of broadband infrastructure a new HM Treasury document suggests a lot with its 'Fixing The Foundations' title, but a read of the index page alone which shows the 77 pages cover digital economy, tax, universities and the Northern Powerhouse should tell everyone that any single area is only going to get minimal mention.
"Productivity is the challenge of our time. It is what makes nations stronger, and families richer. Growth comes either from more employment, or higher productivity. We have been exceptionally successful in recent times in growing employment. We are proud of that. But now in the work we do across government we need to focus on world-beating productivity, to drive the next phase of our growth and raise living standards."Extract from HM Treasury paper foreword
The specifics of broadband are that the 90% superfast target gets no mention, with the 95% target being the main mention, a key thing is that it is says 'ensure superfast broadband (at least 24Mbps) is available to 95% of UK households and businesses by 2017;'. We are expecting the UK to hit 90% in Dec 2015 or January 2016, so hitting 95% before the start of 2017 would be surprising.
We had really hoped the Budget would expand on previously announced USO intentions or the ultrafast help for broadband providers, but be prepared to be disappointed, while there is talk of near universal 4G and ultrafast broadband there is almost no substance. While dissapointing it should be pointed out this is very similar to the situation exactly 5 years ago when the original superfast targets were being talked about and so it may be that if the political machine follows the same pattern we will see ultrafast projects starting in 2017 to 2018. In theory commercial coverage due to expansion plans from Virgin Media, Hyperoptic, Gigaclear should mean we have ultrafast available to two thirds of premises by then, i.e. exactly same scenario as superfast went through.
"7: World-class digital infrastructure in every part of the UK
Our digital infrastructure is improving fast, but there are still too many businesses hampered by slow connections, and households who cannot play their full part in the digital economy. The government will:
- ensure superfast broadband (at least 24Mbps) is available to 95% of UK households and businesses by 2017; the government’s superfast broadband programme is passing an additional 40,000 premises every week
- support the market to deliver near universal 4G and ultrafast (at least 100Mbps) broadband coverage
- make it easier for the market to roll out the fixed and mobile infrastructure the UK needs, including through proposals to reform planning rules on taller mobile mastsHM Treasury on broadband
In terms of the FTTH/FTTP future for the UK, as things stand around 1% of UK premises have access to Openreach native FTTP and Hyperoptic is close to covering 0.5% of UK premises. KC in Hull contribute around 45,000 premises and then Gigaclear with a good few thousand premises is the next largest. The unknown quantity that may be the game changer is CityFibre and the Sky/TalkTalk joint venture if that can go from zero to 20,000 premises passed in York in 2015 and then expand further we might see the commercial appetite for FTTH pick up.
The policy question is really will simpler red tape and planning be enough to stimulate firms, or will the key driver be an attempt to gain larger shares of the pay TV market by Sky and TalkTalk. Sky is already dominate in the pay TV market, but by being involved in FTTH it ensures that if satellite TV does start to fade they will be in a good position still. The Virgin Media cable expansion plans have the investment underwritten by the UK Government, will others now be able to get the same advantages and how far will they go and what will the Government believe to be a near universal coverage amount.
Update Tuesday 14th July KC has been in touch with an updated coverage figure for their Lightstream product of 45,000 premises passed. We are now just waiting on a set of postcode data so we can update our availability tracking.