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House of Lords votes for 30 Mbps USO in Digital Economy Bill
Wednesday 22 February 2017 19:35:20 by Andrew Ferguson

The Digital Economy Bill has many facets to it, but a debate a couple of weeks ago was held in the House of Lords and now the Lords have followed up with amendment to the USO plans which has gone to the vote today and at 250 votes for and 206 votes against there seems an outside chance the USO may change its nature.

"Lord Mendelsohn

1: Clause 1, page 2, leave out lines 4 and 5 and insert—
  • (2B) The universal service order must specify that the target for broadband connections and services to be provided before 2020 must have—
    • (a) speeds of 2 gigabits or more;
    • (b) fibre to the premises (FTTP) as a minimum standard;
    • (c) appropriate measures to ensure that internet speed levels are not affected by high contention ratios;
    • (d) appropriate measures to ensure service providers run low latency networks.
    (2BA) The universal service order must specify as soon as reasonably practicable that, by 2020, the following will be available in every household in the United Kingdom—
    • (a) download speeds of 30 megabits per second;
    • (b) upload speeds of 6 megabits per second;
    • (c) fast response times;
    • (d) committed information rates of 10 megabits per second;
    • (e) an unlimited usage cap.
  • (2BB) In meeting the obligations set out in subsection (1), internet service providers have a duty to ensure that their networks offer at least the minimum standards specified in subsection (2BA) to every household in areas of low population density, before deploying their networks in urban areas.(2BC) The Secretary of State must ensure that—
    • (a) the premises of small and medium-sized enterprises are prioritised in the roll-out of the universal service broadband obligation;
    • (b) rollout of universal service broadband obligations is delivered on a fair and competitive basis.
  • (2BD) The universal service order shall, in particular, say that mobile network coverage must be provided to the whole of the United Kingdom.
Uncorrected Hansard transcript from House of Lords 22nd February 2017

The amendment seems to be calling for rather than a USO that by being available, rather than on demand as previous Universal Service Obligations have been they want the UK to hit 100% superfast coverage by 2020. Additionally rather than the previous 10 Mbps minimum speed goal, a more ambitious 30 Mbps target for downloads with 6 Mbps upload speeds is favoured. The committed information rate may actually be the hardest part, since if enforced in law would require UK broadband providers to build their core networks such that every customer can download at 10 Mbps at the same time, unless this means just across the access segment as with Openreach GEA products now, where once you reach the ISP you fight for bandwidth as normal.

Ofcom did explore various options for the USO back in 2016, and the House of Lords do discuss this saying 'The economic case for an additional £800 million is extraordinarily well justified' with the £800 million being in addition to a 10 Mbps USO where a slightly better than the bare minimum solution was roughly costed at £1.2 billion.

Those looking at the USO and to date only BT has put its head above the parapet in any official manner were probably hoping to deliver the USO via a mixed technology approach, i.e. some more VDSL2/ maybe using more remote nodes, some fibre to the premises, some 4G, some fixed wireless and for the most expensive maybe satellite. In practice all those technologies can also provide 30 Mbps but you end up having to change the technology mix.

Could the UK deploy 1,160,000 million fibre to the premises connections by 2020, given the money to pay for the labour and a willingness to accept more disruption on rural roads then without a doubt. The big question for the Government if this amendment makes to into law is how to do this without BT (or anyone else who grabs a share of the money) from exploiting the tight timescales, we know BT is planning 2 million premises of pure fibre by 2020 already, but a lot of that looks to be urban where distances are shorter and new build apartment blocks, to deliver to pure fibre to every remote property is a very different task and may see some homes having £30,000 spent to get them superfast broadband when the resident does not even want broadband.

We applaud the ambition of the House of Lords but worry that if the bar is set very high we may end up getting very little, or looking at it another way its signing a blank cheque for BT Group.

The outside in, or inside out approach to the roll-out is potentially a distraction, when what would make more people happy would be if there was a way to prioritise who did get much better broadband, since the USO is not addressing a solely rural problem.


Posted by gerarda 2 months ago
30Mbps for all by 2020 just mirrors the EU target, which the Government had quietly dropped from its ambitions.
Posted by ian72 2 months ago
By the looks of 2BA(c) I would think satellite would not be an option for USO? Latency would be too high? Also, what is 2B(a) about? 2Gb/s to whom and under what circumstances? Also 2BA(e) seems to rule out current 4G options as at present it doesn't seem possible to provide unlimited cost effectively. And finally, where are the caps on costs to ensure the USO is affordable to the punter?
Posted by hvis42 2 months ago
10Mb/s "committed" rate is promising. This would not cause Relish & others who can offer over-USO speeds late night and early mornings but only 0,5-1Mb/s at prime time "poison" areas that suffer from sub-USO speeds to receive whatever help or support they decide to hand out for network upgrades.
Posted by craski 2 months ago
2BA "fast response times" leaves far too much wriggle room for the satellite providers to claim they already have this USO covered.
Posted by godsell4 2 months ago
reading the whole hansard transcript may help, though I am still trying to parse exactly the points being made
Posted by themanstan 2 months ago
Some of the wording is interesting...

USO should mean a functional level of broadband, yet Mandelson is saying that 10 Mbps does not provide decent broadband.

To me decent is far above any functional level.

Hence, the difference between a functional haircut and a decent haircut...
Posted by jumpmum 2 months ago
I don't quite understand 2B(a) & (b). Does this mean that any connection provided from now to 2020 under the USO must be capable of 2Gb or more and over FTTP. (This rules out everything bar FTTP!)
And 2BA that this should be available to all households that have below 30 :6 Mb ( the mimimum USO standard)??
Asr as I know no-one provides a 2Gb or more service at present!
Posted by themanstan 2 months ago
The committed rate is the one to hurt the customer the most, irrespective of the service level you want the ISP must provision for every customer 10 Mbps... So B4RN for example who have a 20Gbps (10G peered and 10G tier 1) would have to have 35+ Gbps, originally ~3500 connections now? Almost doubling the capacity would have a huge impact on monthly costs
Posted by andrew (Favicon staff member) 2 months ago
The amendment does appear to require all USO connection to be FTTP based, though am comfused by the wording, as stating its the minimum standard leaves me confused as to what there is above this.

Posted by andrew (Favicon staff member) 2 months ago
As an ambition to get an isolated Scottish premises with FTTP when it has no main roads or mains electricity would make the UK world leading, and even with the B4RN model where they are doing amazing things, expanding that to a scale to handle 1 million plus USO connections would be a very tall order.

Plus with a high USO and the CIR you would be expanding the number to be helped beyond the Ofcom analysis figures.
Posted by jumpmum 2 months ago
Above the minimum would be 2Gb-10Gb which in my opinion is no way a Home seervice at present. Many businesses run way below 1Gb at present as unless they are providing or streaming multiple video services they do not use above 200Mb even for sites with over 100 people. How big would your pipe to the speedtest have to be if 500k connections were at 2Gb??
Posted by godsell4 2 months ago
If this idea is adopted, we can see those in the final 5% having to wait even longer to get anything, because BTO will go back to the start again updating the easy and cheapest to do first. Careful what you ask for!
Posted by ian72 2 months ago
@godsell - how does that work? Surely if the USO is enforced then those 5% would be the ones that had to be done by 2020 no matter what else was going on?
Posted by godsell4 2 months ago
There is confusion about whether the USO will come into law by 2020 or if it will set a target for 2020, which would mean it has to come into law very soon. The text of the OFCOM consultation for USO was erring towards the USO coming into law in 2020 on my reading, others may have read differently.

I wonder if BTO have enough trained staff that would roll this out quickly enough, TBB says 91.8% of premises are now above 30Mb, BTO will servie the easiest and cheapest to reach first, why wouldnt they?
Posted by jumpmum 2 months ago
Godsell, the amendment reads that this would be to all households (!) that can only get under 30:6Mb would be able to ask for a USO service as in section of '2B'. eg an FTTP connection capable of 2Gb min, with kow contention and low latency (last 2 are unspecified quantities!)
Posted by andrew (Favicon staff member) 2 months ago
All depends on how you define 'available', broadband industry definition means can order and minimal work needed, e.g. get a coax/fibre from kerb into the property for FTTP. Thus FoD and CityFibre metro network does not count as available.
Posted by TheEulerID 2 months ago
(2BB) ..."a duty to ensure that their networks offer at least the minimum standards specified in subsection (2BA) to every household in areas of low population density, before deploying their networks in urban areas."...

So does that mean that the no network operator can provide higher speed broadband to urban areas until they've done all the rural ones? That's insane. That would stop both VM Project Lightning and and OR deployment dead.

Posted by victoriaonline 2 months ago
@TheEulerID that is exactly that paragraph that caught my eye when I read it!

As someone who still has very slow broadband and has been told by Connected Counties (Hertfordshire) that "I am afraid that the programme has still not been able to include this postcode at this time"... the paragraph at least gives me hope that perhaps one day my area might get receive "superfast" broadband.

I didn't read it as the providers would have to stop ultrafast deployment to more populated areas, just they must not leave out those rural areas that have currently been left out.
Posted by andrew (Favicon staff member) 2 months ago
Wording does carry an implication since which providers would this apply to? Will Virgin Media have to do deep rural areas too?
Posted by TheEulerID 2 months ago

I can't see how that can be read any other way than service providers have to bring rural areas up to that 30/6 standard before deploying into urban areas. It's pretty well exactly what it says.

If it was for state-assisted projects, that would be one thing. Governments can set priorities for state money. However, it's a very different thing to tell commercial companies how they must invest.
Posted by andrew (Favicon staff member) 2 months ago
All hinges on who takes on the USO mantle, or if no-one wants it.

Of course if the cost threshold was £4,000, suspect many of the deeply isolated won't want to stump up another £1000+ install fee.
Posted by TheEulerID 2 months ago

That's assuming it's going to be voluntary. The PSTN USO wasn't. Of course, it's highly debatable if Ofcom have the power to impose a BB USO on a network supplier, and certainly not without being able to demonstrate it can be internally financed due to the existence of SMP in the relevant area (as happens with OR & PSTN).

However, that consideration goes away with primary legislation which is only limited (for now) by EU laws.
Posted by TheEulerID 2 months ago

I'd also say that Ofcom also have no power to impose any industry levy to fund a USO. That too requires primary legislation. In that case I'd expect the USO responsibility to fall on some form of quango to fulfil using this revenue stream, presumably by contracting network operators to provision it. With increasingly fragmented areas, that could be a logistical nightmare.
Posted by ValueforMoney 2 months ago
It seems reckless to attempt to write a USO before the Ofcom WLA consultation 2017. That ought to set the correct signals for the outcomes desired.
Posted by godsell4 2 months ago
Is there an online version of the Digital Economy Bill with or without these suggested amendments? I want to read it in context of the rest of the bill.
Posted by themanstan 2 months ago
Posted by godsell4 2 months ago
Thanks Stan
Posted by TheEulerID 2 months ago

For once we are in agreement. Passing acts before the Ofcom have produced the report on the options is clearly the wrong way of ordering things. The Ofcom report was a public consultation, and plenty of time for input from politicians. Later on they can look at any required primary legislation.
Posted by andrew (Favicon staff member) 2 months ago
My understanding original USO aim was to set the framework and base this around a 10 Mbps base line (which is different from a target) and use secondary legislation which is faster to enact to ramp up the speed over time.

The amendment seems to be going for the believed future proof arrangement from day 1.
Posted by TheEulerID 2 months ago

That was my understanding too. However, that does leave an issue in that the use of (mostly) LR-VDSL approach to squeeze in a reasonable approximation to a 10mbps USO will not really provide a method of going beyond that in the last few percent (although it should increase the 30mbps coverage markedly).

Even with LR-VDSL that last few percent can only be lifted with radically different (and probably disproportionately expensive) approaches.
Posted by TheEulerID 2 months ago
If secondary legislation is going to be used to radically uplift the USO such that it is capable of financing such large (and subsidised) investment, then they are going to have to build that into the enabling primary legislation, even if it's not enacted at the start.

I also suspect that OR would be looking at that very carefully as there's a danger they could be left with stranded assets if overtaken by some new, subsidised investment.
Posted by godsell4 2 months ago
I guess setting the USO to 30Mb, would force the turn off of ADSL which would help the use of and rollout of LR-VDSL. With LR-VDSL being an upto 40Mb connection which gives 30Mb at distances up to 1.5km is going to get good coverage. What percentage of lines are within 1.5km of a cabinet? I assume it must be into the high 90's which leaves a small percent that would go straight to FTTP.
Posted by TheEulerID 2 months ago

Andrew has already estimated what proportion of properties could reach 30mbps with 100% LR-VDSL. 94.1% on existing live cabinets, 96% for all PCPs, live or not.

I suspect it's politically unthinkable to force LLU operators to drop exchange ADSL within 3 years. They'd want compensation for the stranded assets.
Posted by TheEulerID 2 months ago
In addition, the remaining 4-6% would require either FTTP or active nodes further into the network and, pretty well by definition, those will be the most remote and expensive to serve and probably very scattered. Fibre would be going down road past properties on FTTC.
Posted by andrew (Favicon staff member) 2 months ago
The 94.1% is probably higher now, as we've seen more infill and EO rearrangement cabinets appear in those six months.

Will see if I can remember to give it a run again in a month or two.
Posted by godsell4 2 months ago
@TheEulerID the companies with LLU assets are all the same who want cheaper access to GEA-FTTC so I think they will not complain too much, they have to make a choice. That captial equipment has been installed for a few years now and has been written off by now I would hope, it will be in 3 years time.

Also those in remote areas, the most likely to need LRVDSL, are on Market A exchanges where there is no LLU equipment and turning off ADSL should happen ASAP.
Posted by AndyCZ 2 months ago
Wouldn't most LLU exchange assets have been fully depreciated by now anyway?
Posted by TheEulerID 2 months ago

I rather doubt it. I suspect some of those LLU operators will have chosen deliberately optimistic views about asset lifetime as that makes them appear to come into profit earlier. The trick is always to look at cashflow first. How profits are calculated is something of a company presentation choice; cashflow is rather more difficult to disguise.

nb. HMRC calculate taxable profits rather differently, and they take no account of depreciation. They have their own capital allowance system which is often wildly different to depreciation.
Posted by themanstan 2 months ago
OFCOM need only apply the rules it applies to Openreach... i´ve seen 8 years being applied...
Posted by godsell4 2 months ago
And here is link to the section of the Communications Act which is proposed to be modified by the DEB
Posted by ValueforMoney about 1 month ago
I am sure these will be reduced to things for Ofcom to consider when it is empowered to design a USO. Ofcom will not be in any hurry to so do so, where some basics are agreed for 2020 with some review dates.
Telephony USO was written once the engineers had finished, and written the manual the lawyers could refer out too. The 4g coverage obligation due this year should act as a rehearsal for Ofcom enforcement.
Posted by ValueforMoney about 1 month ago
Euler ID - we do bicker on the gaming of costs, we are now £325m closer together and for each of the next 4 quarters at least, we will be closer still.
BT/BDUK will need some means of crediting fibre extension activity against the Capital Deferral, perhaps post Brexit.
Posted by rtho782 about 1 month ago
By the wording of this, if me and 5 friends decide to set up our own little company to supply ourselves broadband, we aren't allowed until we've supplied 30mbit+ to every rural property in the UK. Which is plainly ridiculous.
Posted by Blackmamba about 1 month ago
Hi Broadband Watchers.
The results for the Surrey OMR Gainshare are on their website today and they cover the above remarks and the work has been programmed up to 2020. I feel with all the new systems G/Fast FTTC LN 3DB the EU 30 meg will be meet on the post codes.
Posted by andrew (Favicon staff member) about 1 month ago
Why are you talking about 30 Meg they are mentioning 24 Mbps, alas nothing for me, which is OK as borderline but part of postcode is down in the 20 Meg, and I was 15 Meg until picked a better VDSL2 modem
Posted by andrew (Favicon staff member) about 1 month ago
I've also found postcodes not in the plan that fall below the 15 Mbps threshold
Posted by Blackmamba about 1 month ago
Hi. Broadband Watchers.
I have also found Post Codes next to a FTTC there are also Post Codes not on the list serving approx 200 customers UG and overhead on one Cab this may be still in the commercial section. I feel it will be fibre all the way covering a large loop. I used 30 meg because there is not many yards between 30meg--24meg in a cable run. Remember I have the GPS positions of the post codes and the Old Cabs in my D/base.
Posted by andrew (Favicon staff member) about 1 month ago
I suspect so do Surrey, as evidenced by their maps.
Posted by Blackmamba about 1 month ago
Hi Broadband Watchers.
So which maps are correct is it TBB or SCC stating the GPS positions of Post Codes and the MP,s areas.
Posted by andrew (Favicon staff member) about 1 month ago
Are you saying that Surrey County Council map and ours do not agree on postcode positions? A few quick checks suggest they do agree, but with 15,000 premises not superfast as identified in the OMR and a gainshare deployment of 6,000 there are going to be ones not covered.

Posted by Blackmamba about 1 month ago
Hi Andrews staff.
The Waverley area borders are Ok on TBB but the area borders are different on the SCC maps so Waverley losses on the premises covered in the Cranleigh exchange area thus effecting the % at 15 meg. In doing so this does not highlight Ewhurst problems because they are tied to the Guildford area. I was caught out when I thought JH was watching the cranleigh area.
Posted by andrew (Favicon staff member) about 1 month ago
@Blackmamba And area borders are relevant how?

I could draw the area borders in yellow marker pen and it would make no difference to how our data is crunched. The postcode to council/district/council is using the standard ONS data
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