Towards near universal superfast broadband coveragesamiragazzane
The Government announced an additional public fund of a total of £645 million which will further extend superfast broadband coverage to 98% of UK premises by 2020. This is an update to figures released towards the end of December 2016, indicating that a total of £440 million would help reach premises beyond the 95% target (by end of 2017) under the BDUK scheme.
Whilst efficiency savings have modestly increased since December (from £150 to £180), the additional cash boost is directly attributed to the BDUK clawback mechanism; the return of subsidies by suppliers when customers take up superfast broadband connections covered by the programme. This translated into a reinvestment by BT/Openreach of £465 million (compared to £292 million in December).
Interestingly, coverage (both commercial and publicly-funded) of superfast broadband is improving (94% of premises are now covered by a connection of 24Mbit/s), whereas take-up is slowing down. In its latest Connected Nations report, Ofcom noted that “growth in superfast take-up might be reaching a plateau. Given the relatively high levels of superfast coverage, it is unclear why more consumers are not actively taking up faster services. The adoption of superfast broadband services is the trigger for the reinvestment of BDUK funds to extend coverage so more work needs to be done to explore why superfast adoption is slowing.
Nevertheless, the additional funding announcement is welcome and will help drive superfast coverage well into the last 5%, as well as having a spill-over benefit in decreasing the number of premises which are on sub-10Mbit/s; therefore reducing the potential footprint and cost for the Universal Service Obligation.
It is essential of course to ensure that this investment – as with any investment in infrastructure – can go as far as possible. That is why we are continuing to develop our work around reducing barriers to network deployment so please do keep an eye out on future announcements.
The BSG will be exploring the issue of take-up of superfast services at its upcoming Annual Conference on the 2nd of November.