Broadband News

Scottish hotel quoted £80,000 for BT fibre optic line

Outrage at a quote of £80,000 for BT to provide a fibre optic line to a remote Scottish hotel, namely the Glen Cova Hotel (DD8 4QS is you want to look it up on a map) means it is likely to become a political cause celebre.

The Telegraph and its political editor Simon Johnson has highlighted the plight of this hotel, but this is not just a plea for better broadband for that hotel as the article appears to be part of the Westminster versus Holyrood sparring that is underway at present.

A quick peak at a map and a check of the address indicates that even getting 0.5 Mbps from ADSL (and it is likely to be the old Exchange Activate service) is actually pretty good for the distance involved and while we know satellite broadband is far from ideal given the location we would recommend that the hotel installs a satellite broadband service and while latency will be a pain, for social media use and guests uploading content it would be vastly superior to the existing ADSL service.

On the £80,000 quote it becomes less gobsmacking when you look at the distance to the current closest VDSL2 or FTTP service and that appears to be some 14 miles away in Northmuir to the south. There are no obvious plans that we can see to deliver FTTC to the Clova exchange and given the size of the exchange footprint which is a thin roughly 12 mile long strip comprising around 30 premises FTTC (VDSL2) would be useless without five or six cabinets and thus a FTTP deployment would be more likely.

In theory the Scottish R100 project should help premises like this, but a lot will depend on the level of funding available i.e. it is possible that a satellite or TV white space (white space tech is much more like fixed wireless so better latency and speeds) will be used to deliver 30 Mbps and faster to such remote locations. NOTE: The same caution over technology applies to the BT USO proposal and pretty much any other USO proposals.

Stories like this are going to be increasingly common in the year, the reverse of what one would expect as the coverage levels increase and that is because until 100% coverage is achieved at a speed that people will be happy with (and that speed varies widely) those who are yet to be reached or helped will feel increasingly ignored, or put another way when two thirds of people cannot get decent speeds it is somehow easier to accept than being in a group of just 1 in 30 or smaller who cannot get decent speeds.

Comments

How stupid. Of course getting broadband in the middle of nowhere is expensive. What do they expect?

Satellite is their option.

  • rtho782
  • 15 days ago

It certainly sounds expensive on a personal level, however, you have to factor in the fact the BT generates in excess of £2000 million profit per year. Next to that £80000 is peanuts.

This isn't really an argument about money, its about whether we consider decent net access and mobile coverage to be a utility these days, what level USO we require and how fast we push BT/Openreach to meet it.

Personally I'd say they could spend an extra £1000 million per year on their staff and infrastructure yet still be vastly profitable. Wouldn't that amount of money help reach those remote areas?

  • adrinux
  • 15 days ago

Of course it is an argument about money. It always has been. Ask all those cable franchise companies that started up in the late eighties and nineties.

http://news.bbc.co.uk/1/hi/business/1964267.stm

  • WWWombat
  • 15 days ago

Some of the problems are that the accountants within the local loop Openreach, can only count on revenue from the elements they charge for, so if they rolled out native FTTP and could do it to those 30 premises for £80,000 in total and everyone ordered a FTTP service they'd have revenue of £2,500 to £3,500 per year plus £3,000 from install fees in the first year.

The public would be paying something like £12,000 to £15,000 per year, the difference being down to the various layers taking their cut.

There is an argument for full vertical integration in some areas to help fund better service.

  • andrew
  • thinkbroadband staff
  • 15 days ago

@thinkbroadband And your point is what ?
If BT have to put duct and fibre on the ground to get to a remote hotel, t… https://t.co/Baq3m37BmI

  • @yorkierich
  • comment via twitter
  • 15 days ago

I think there is FTTC in Contachy which is a bit closer. For where it is and if you took all properties en-route, add splitter and drop wire costs, you could see it being done. If a telephony sunset date helped the case, it should be permitted.

  • ValueforMoney
  • 15 days ago

https://labs.thinkbroadband.com/local/broadband-map#10/56.7708/-3.0837/openreach/ and where is Contachy?

Cortachy is 1 mile north of where I mentioned and cannot see any FTTC live and no late stage roll-out indications either.

Sunset dates on phone services - by the time the various consultations are run, and many thousands spent on accountants and layers likely to be later than 2021

  • andrew
  • thinkbroadband staff
  • 15 days ago

Cortachy Cab 3 is currently being built for FTTC under Scotland Superfast's programme and is due to be completed next year.

It's still a substantial distance to cover and no wonder the cost is so high.

  • AndyCZ
  • 15 days ago

"Stories like this are going to be increasingly common...."

Of course they are. Once you get down and dirty among the last 5% the cost per connection is going to be mega. Did anyone not understand that?

And satellite isn't the answer

  • 961a
  • 15 days ago

@thinkbroadband What was this quote actually for? FTTPoD or leased line?

  • @timmay2
  • comment via twitter
  • 15 days ago

Could they only afford 1 drone for Wales?

  • ZenUser27
  • 15 days ago

This appeared on 'Call kaye' on Thursday morning (BBC Radio Scotland chat show). Then the journalist raced off to get the 'scoop'.

Interesting that the Angus MP (Conservative) is blaming the SNP in what is primarily a BT / UK Gov matter. Can only guess the 95% 2017 target is looming, and they want to sharpen the knives on the devolved Gov, rather than take any stick.

  • camieabz
  • 14 days ago

Pointless articles like this make me mad. Go ask a cable company for the same thing do you think it will be any less
BT is a private company same as any cable company treat them the same. if thats what it cost to provide a fibre in the middle of nowhere its not the fibre companies fault. Get Real

  • tally100
  • 14 days ago

Andrew / AndyCZ .. if there is 30 premises en-route, if a distance based charge from the splitters is introduced, if BT contributes its £300-£400 per FTTP connection, the project should be added to the Scottish work and benefit from the cost based state aid conditions. Plenty of this going on elsewhere, this is a resource rather than a budget issue.

  • ValueforMoney
  • 14 days ago

@VFM

That's the role of Digital Scotland. They will have their own criteria for what is value for money based on contracts signed. Even if a BT contribution drops the cost to public funds to about the £70k mark, as your number suggest, that's still quite a subsidy per property passed and it might well deny service to several times that number of properties. I've no idea why you think budgets are not an issue unless you think this is just one of a small handful of similar cases.

Locations like this are always going to present problems of who pays.

  • TheEulerID
  • 14 days ago

EuerID - The monies owed are huge and these costs should be averaged across the whole intervention area. The budgets were generous and allocated on that basis. The incremental approach was more of how BT decided to respond in a manner that failed to plan sufficient FTTP and in-fill. Digital Scotland criteria are pretty much the same as everywhere else but they have to suffer the BT gambit like everyone else.

  • ValueforMoney
  • 14 days ago

@adrinux

Regarding decent Internet and mobile coverage as being regraded as a utility, I am amongst many people in the Southeast who have lousy Internet, no mobile coverage unless standing in a specific field, and no mains gas.

The FTTC has been "being built" for over a year, so not holding my breath on that one.

  • Thumper
  • 14 days ago

@VFM

"The monies owed are huge and these costs should be averaged across the whole intervention area."

That's impossible. The money owed by BT under gainshare is attributable to individual projects, of which Digital Scotland is just one. Given that much of the money was local match-funded, it's not going to get re-averaged. The same with costs - do you think some local BDUK project is going to happily accept being charged more to subsidise another project?

There were differential allocations recognising local conditions, and that was when the original budget allocation was done.

  • TheEulerID
  • 14 days ago

@VFM

I should also add that it's generally recognised that if all the gainshare money is reinvested, then that might get as far as 98% coverage. Remote locations like this are very likely to be in the past couple of percentile cost wise. As far as we can tell, there isn't sufficient money to get to 100% (even the voluntary 10mbps USO recognised a further £600m for the tail, and even then there would have been a cost cap).

  • TheEulerID
  • 14 days ago

I also suggest @VFM looks at what is planned in some parts of Scotland, still areas with FTTP planned under what looks like the Digital Scotland scheme. So work in Scotland is far from finished.

Of course as the delivery has not been a disaster and BT have not spent all the money on champagne and deep fried mars bars some seem unhappy.

Can you imagine a project to build an aircraft carrier where there was cost under runs, and there is scope for building a few extra smaller ships with the savings?

  • andrew
  • thinkbroadband staff
  • 14 days ago

TheEulerID - Digital Scotland budgets are generous and do not underestimate how the funds being returned from urban areas can be res-distributed.
It is worth while to call for LA Investment Account balances to be published - post phase 1 true ups, so these funds are not lost and can be re-cycled. The £150m for NI (see BDUK procurement tab) is likely to be part of this.

  • ValueforMoney
  • 13 days ago

Andrew .. indeed it is far from finished and you may find that these 'fibre ribbons' or fibre extensions become the norm.
These are not savings or efficiencies just the monies intended to do about 12% FTTP in-fill in the intervention area. If you think these are savings and keep reporting them as such then you are being misled.
The only mystery will be why more was not planned in the first place, especially FTTP in business parks.

  • ValueforMoney
  • 13 days ago

And where is this documentation indicating 12% FTTP was planned for the Scottish Intervention areas? No sign of that sort of volume in build at all.

I guess fibre ribbons are like digital village pumps.

  • andrew
  • thinkbroadband staff
  • 13 days ago

VFM. There may be 30 premises in the exchange but they are hardly passed en-route to the hotel. there are about 5 on or near the road. Some are on the other road the opposite side of the river a couple are further up the valley and the rest appear to be in the other direction from the exchange. To cover all 30 with FTTP could cost double to treble the quote. On top of that they would still have to get fibre to the exchange building from Northmuir ( I think it is still a Cu fed building). The premises are so separated satellite is the only cost effective, if very unpopular, option.

  • jumpmum
  • 13 days ago

jumpmum

You describe many locations in Scotland where connecting properties basically means doing one by one. Very expensive, but everybody has known this is the difficult end.They shouldn't all have been left till last. (Hoping to forget them?)

Using a drone is a good idea & can save money. Since we are promised faster speeds still as technology progresses, satellite is not the answer

Taking the total cost of 100% of premises in UK (many costing peanuts)the whole venture is cost effective even if the last ten cost half a million each

  • 961a
  • 13 days ago

late th the party here but some years ago we (Kijoma) attended a meeting in Glasgow with the Scottish Executive about Broadband roll out there. There were many attendees from big and small providers alike.

The result was the SE declared zero interest in any submissions from the smaller providers. Despite us and other providing offers of solutions to the locations they had identified at the time.

If the money is only ever going to be given to the behemoths and squandered where a profit can be made for them then this situation will continue for years to come.

  • kijoma
  • 11 days ago

Andrew - the proof is in the budget, .. subsidy for cabs was £600-£800m the remainder FTTP and other in-fill. Double digit needed FTTP on the in-fill. Your suggesting there was a plan to exclude folk.

Jumpmum - you may be right, it would be good to see a distribution of splitters needed, but £80,000 is a lot less than other quotes seen for less challenging areas. if as you say then it could be handed off to Kijoma and not gamed.

  • ValueforMoney
  • 11 days ago

20 units. Say 200 days a year. Depreciatie over 4 years, it's about a pound a night. Not bad considering what some organisations charge for internet access.

  • roberts-end
  • 11 days ago

Oops bad maths. Scratch that.

  • roberts-end
  • 11 days ago

How can subsidy for cabs be £600m in Scotland? That is more than the BDUK contract value.

Oh and turns out the quote was for a leased line service specific to the hotel, rather than a GEA build

  • andrew
  • thinkbroadband staff
  • 11 days ago

I'm unsure how you could split any subsidy between technologies accurately without knowing the details, except by making some assumptions which would still need pretty detailed information about the specific network solution

  • Gadget
  • 10 days ago

Andrew - 12% ish all UK.
Gadget - Once upon a time, BT offered a mixed economy solution where the mix percentages featured and limits of cabinets solutions acknowledged. Of course it was crude and imperfect, but the ambition was catered for and budgeted accordingly.

  • ValueforMoney
  • 10 days ago

Andrew - leased line v GEA, another upside to build upon.

  • ValueforMoney
  • 10 days ago

So you think the BDUK money that has not been spent is enough to deliver 3,480,000 premises of FTTP? So how much is left? Presume this is your £477m figure.

Seems a tall order given the costings appearing from both Gigaclear and BT in phase II and later projects, or are you asserting that both operators are over estimating the cost of delivering.

If there was a chance that the BDUK money was going to deliver 12% full fibre I'd have expected a minister to have seized on that chance give the love shown for full fibre as an example of how perfect they are.

  • andrew
  • thinkbroadband staff
  • 10 days ago

Because of the Pareto nature of the costs the average cost to date is unlikely to be a good indication of the cost of those areas as yet not covered.

  • Gadget
  • 10 days ago

Andrew -12% of the intervention area. Please.
Gadget - this is more about BT wishing to mis-sell a private circuit where GEA could be extended.

  • ValueforMoney
  • 9 days ago

My figure was based on your statement "Andrew - 12% ish all UK." so don't please me, I simply did the maths based on the facts as presented to me.

So still waiting to learn if this 12% is in some actual contract, or is just the musings of an individual who extrapolates a lot and thinks this would a nice goal to target.

  • andrew
  • thinkbroadband staff
  • 9 days ago

VFM - how can it be mis-selling, if the customer can ask for a quote for a private circuit or initiate a community fibre deployment by their own choice.

Clearly the location has not only failed commercial deployment criteria but also the Scottish BDUK criteria as well.

Only options I can see are Private circuit, community fibre, gainshare reuse by local authority or R100

  • Gadget
  • 9 days ago

Hotel website says:

PLEASE NOTE THAT THERE IS NO MOBILE PHONE RECEPTION IN THE GLEN AND THE HOTEL HAS LIMITED WiFi ACCESS

  • Somerset
  • 8 days ago

Gadget - It is mis-selling, if the GEA extension as an option is not outlined. Digital Scotland is tied to the limitations imposed by the phases. There will be many more phases.

Andrew.. you will not find 12% specifically, you will find the intent to do in-fill and to go as far as the monies will permit. Within that GEA extensions ought to feature more widely rather than mis-selling a private circuit.

Somerset .. There is now public subsidised fibre with reach. Adding a femto cell to a functioning GEA connection will enable some mobile service.

  • ValueforMoney
  • 7 days ago

As I understand it the EAD option quote was what was requested by the customer, they could easily have opted to explore the Community Fibre route which is available to anyone not in a build programme, but apparently did not for their own reasons.

Given AndyCZ's comment above I cannot see how you can claim there is fibre within reach???

  • Gadget
  • 7 days ago

@VFM - How far is the public subsidised fibre from the hotel? 16km to Cortachy along narrow roads that would be fun to block during installation. Maybe part of the reason for the high cost.

  • Somerset
  • 6 days ago

The quote was for a 100 Mbps EAD circuit and as pointed out 16km is a pretty long run.

I don't like satellite solutions, but given location not having one seems daft given the improvements it should offer compared to 0.5 Mbps ADSL.

And back to the 12% so if its just an intent where does the 12% come from? Is it an extrapolation of yours or has some elected official or current BT employee stated it as an aim for intervention areas?

  • andrew
  • thinkbroadband staff
  • 5 days ago

Andrew, thanks for the clarification about the circuit.

What concerns me is that the EAD on it own would not deliver any internet access - at the distant end you would either need to provide internet via an ISP, or arrange for your own internet access direct (effectively becoming your own ISP). I wonder if all that was also included in the £80k?

  • Gadget
  • 5 days ago

80k would likely be the install cost of the leased line. Monthly rental from the service provider who arranged the quote would include the connectivity.

  • ribble
  • 5 days ago

@VFM - To repeat - where does 12% come from, it's an exact sort of number?

  • Somerset
  • 4 days ago

Somerset - the workings were as follows, 25,000 cabs x£25-£30k average= c£750m, - £1bn subsidies for FTTP in-fill. 10-15% of 6m lines provides a range if 600k-900k provides a healthy budget. 12% was a sensible point to aim at. Why else the match funding if not for infill. Add to this the BT Capital Contribution and you ought to see the potential. Why let the money to be tied down? Why not plan the in-fill and allow the costs to be averaged?

  • ValueforMoney
  • 3 days ago

So this 12% is a figure you alone are creating and does not reflect anything that the BDUK teams/Government/BT aimed for and said officially at any point?

In your extrapolation where does the cost of the undersea fibre in Scotland factor in?

As for planning the infill, you do realise that BT is massively out of favour these days, as a result of years of complaints over wasting money and not delivering full fibre everywhere. So there is a shift in direction and thus existing contracts may not be used to their full extent any more.

  • andrew
  • thinkbroadband staff
  • 3 days ago

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