Broadband News

£5 billion Project Gigabit launches with £1.5 billion to spend

The Government ambition to ensure that home owners and businesses can get an affordable Gigabit connection no matter where they are in the UK is progressing. For those with long memories all this re-announcement of funding as more details emerge is extremely reminiscent of 2010 to 2012 period as the old BDUK process got underway and while the Project Gigabit will operate differently there are a lot of the same hurdles to work through.

So what is new today?

  • More then one million properties earmarked for Gigabit roll-out using a subsidy scheme comprising of £1.2 billion of funding at present.
  • Gigabit Voucher Scheme that was set to end as the 2020/2021 financial year ended is relaunched for 2021 with another £210 million of vouchers. The aim being to help those who are not immediately going to be part of the wider subsidy programme in rural areas.
  • £110 million to fund Gigabit connectivity for up to 7,000 rural GP surgeries, libraries and schools.
  • Call for evidence on using satellite and 5G technology to study how it can be used to reach the hardest to reach areas.

Project Gigabit is our national mission to plug in and power up every corner of the UK and get us gigafit for the future.

We have already made rapid progress, with almost 40 percent of homes and businesses now able to access next-generation gigabit speeds, compared to just 9 percent in 2019. Now we are setting out our plans to invest £5 billion in remote and rural areas so that no one is left behind by the connectivity revolution.

That means no more battling over the bandwidth, more freedom to live and work anywhere in the country, and tens of thousands of new jobs created as we deliver a game-changing infrastructure upgrade.

Digital Secretary Oliver Dowden

Project Gigabit is the rocket boost that we need to get lightning-fast broadband to all areas of the country. This broadband revolution will fire up people’s businesses and homes, and the vital public services that we all rely on, so we can continue to level up and build back better from this pandemic.

Prime Minister Boris Johnson

The target for 2025 is 85% Gigabit coverage and as of this morning our tracking is 39.06% of UK premises, 21.16% of this is FTTP the rest being DOCSIS 3.1 from Virgin Media (some properties already have a choice of DOCSIS 3.1 and FTTP).

With the vouchers and LFFN type funding this means £1.5 billion of the £5 billion has been allocated and this is set to deliver an additional 3 percentage points of Gigabit coverage. We are expecting as that more areas and money may be released from the £5 billion late in 2021, ie. once the initial contracts have gone through the bidding process and the appetite of commercial operators to take on the contracts with the level of subsidy has been tested.

There is some broad detail for some 510,000 premises which are set to be the first areas to benefit from the procurement.

  • 110,000 to 130,000 premises in Durham, South Tyneside & Tees Valley and areas of Northumberland - including Darlington, Stockton, Hartlepool, Middlesbrough, Redcar and Cleveland, Sunderland, Gateshead and South Tyneside
  • 60,000 to 80,000 premises in West Cumbria including in the Lake District National Park
  • 30,000 to 50,000 premises in North and West Northumberland and East Cumbria - including Brampton and Rothbury
  • 120,00 to 140,000 premises in Cambridgeshire and adjacent areas - including Peterborough and parts of Northamptonshire, Essex, Hertfordshire and Rutland
  • 40,000 to 60,000 premises in East Cornwall - including Launceston, Callington and Looe
  • 30,000 to 50,000 premises in West Cornwall - including in Cambourne-Pool-Redruth and Penzance and the Isles of Scilly

Looking at just the first block which seems to be basically the North East region, 130,000 premises equates to 13% of the region and with 2.2% of properties in the region not getting any superfast options at all this may represent a chance to get that 2.2% down to below 0.2%. Alas there are no guarantees and while there is the political will to go as far as possible it is reliant on contract bidders and the winners actually successfully building the networks.

The tenders will emerge in Spring 2021 for these areas and do not expect work to start until the first half of 2022 i.e. April to October 2022. We would add beyond those dates DCMS included in the release that from the start of roll-out operators generally take between 3 and 12 months before people can actually order a service.

A further announcement is expected in June that should cover something like 640,000 premises in Norfolk, Shropshire, Suffolk, Worcestershire, Hampshire and the Isle of Wight.

Further local contracts are expected in Essex and Dorset, additional the Scottish R100 project will boost Gigabit coverage as its roll-out will be dominated by FTTP. There is also the 3rd phase of the superfast roll-out in Wales which is also delivering FTTP.

The old BDUK Superfast programme continues and a mixture of gainshare and possibly other sources funding totalling £490m are apparently set to deliver 172,000 premises of Gigabit connectivity in Scotland, Cheshire, West Yorkshire, North Yorkshire, Lincolnshire, North Lincolnshire, Devon and Somerset.

The call for evidence for the hardest to reach areas includes the belief that there will be 100,000 premises (approx 0.3% of UK properties) that fall into this very remote category i.e. where spending to deliver a fixed line service is exhorbitantly expensive. In the past the Government has talked about a final 1% that may not see Gigabit funding from Project Gigabit so it is unclear whether the numbers have been crunched differently or this is just a worst of the worst scenario. Remember though that while the ambition is 85% Gigabit coverage for 2025, the timelines beyond that date are very flexible, it might be 2030 or it might be 2035 that the UK reaches something like 99% Gigabit coverage.

As with all press releases there are some points that need a bit of clarity added, and in this case we want to ensure everyone knows three things:

  1. Where Gigabit connectivity is rolled out there will be no need to pay for a Gigabit speed. Contract winners must offer a wholesale option and this will invariably a variety of speed and price points will be available. The key with the Gigabit roll-out is to get yourself switched over to the new connectivity which will invariably be full fibre and gain the reliability of FTTP.
  2. While the UK has jumped from 10% Gigabit coverage in 2019 to almost 40% today, this rapid pace is going to fall off a cliff once Virgin Media completes its DOCSIS 3.1 roll-out. After the DOCSIS 3.1 switch on is complete a lot of the FTTP being built commercially will be in cable areas and thus we will get to 63% Gigabit coverage in 2021. The  next 22% needed to hit an 85% target is going to be pretty much just FTTP.
  3. While Gigabit connectivity offers the option for 900 Mbps speeds, this is not a guaranteed speed the issues of shared capacity at a local or regional aggregation point where 1000's or 1,000,000's of customers connections meet will mean that slow downs due to a very busy period will still be possible. For many FTTP networks they are so new and take-up is below the planned capacity invariably so for a few or two performance will be very good. The level of contention is going to be the differentiator between networks and retailers in the future.

With the 510,000 and 640,000 premises that this announcement covers if this 1.115 million properties are being funded by the £1.2 billion that we believe this means a subsidy of just over £1,000 per property and while this is generally more than the original subsidies that happened when VDSL2 was the dominant technology it is lower than the Scottish R100 project and suggests that a lot of the early areas built to will be those just outside the reach of commercial FTTP in rural areas, rather than a handfull of lone properties spread over several square miles. Or put another way if you tried for the broadband USO and are still in shock from a £100,000 FTTP quote you may be part of the chunk of the UK waiting until well past 2025.

On the 5G and satellite evidence call, it is a basic reality of physics that the 700 MHz 5G spectrum will not deliver Gigabit speeds and while low earth orbit solutions are changing the face of satellite broadband (Starlink and OneWeb) they are going to struggle to deliver Gigabit speeds. As measures of last resort they are a significant step up from geo stationary satellite services and vastly better than ADSL/ADSL2+ services.

Comments

Really pleased to see Northumberland included, but alas I suspect this rollout will be to the rural tory voting parts of the county rather than the urban (but still not commercially viable) south east of the county.

The only FTTP around here is in the few new builds.

  • Kr1s69
  • 28 days ago

Would be that be the urban south east of the county that did a smash and grab on Tynedale's £30million pound reserve when it was forced into a unitary authority because that would improve services only for residents in Tynedale see their services get markedly worse very quickly but nicely fixed their financial woes? I could wax lyrical about the urban south east of Northumberland and the detrimental impact they have on the rural west and north till the cows come home. Oh and I never have and never will vote Tory.

  • jabuzzard
  • 27 days ago

Wansbeck council also had a surplus that disappeared into the unitary authority.

Wansbeck constituency has about 3.5% FTTP with Blyth and Hexham constituencies around 7.5% and Berwick 11%.

We benefited from commercial rollout or FTTC but since then we’ve had no visible improvement in broadband infrastructure, with no GFAST or FTTP.

  • Kr1s69
  • 27 days ago

It never ceases to amaze me that 50 years ago the GPO managed to install a copper cable to my house to give me a telephone line. Yet to replace this old cable with one made of fibre seems to utterly confound those in charge of todays communications infrastructure. I fear I am one of the last 3% and so may never get to enjoy a gigabit service. I remain bemused at the talk of getting it to libraries - they closed down ours at least 5 years ago. Just one of many services we no longer enjoy in our rural community.

  • galacticz00
  • 25 days ago

It is not knowledge or ability to do the work, it is who pays for it in terms of labour costs being the largest chunk

  • andrew
  • thinkbroadband staff
  • 25 days ago

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