Government has pledged £67 million towards investing in full fibre broadband connections through the Nationwide Gigabit Broadband Voucher Scheme (GBVS). Vouchers worth up to £3000 for small and medium sized businesses or £500 for residents will be issued to help bring down the costs of getting gigabit connections.
The scheme forms part of the £200 million Local Full Fibre Networks program – of which £95 million was this week awarded to 13 bidders across the UK.
For residents to be able to qualify for a voucher, a local community group – comprising small businesses as well as residents – must be formed. Vouchers may be pooled in this group although the value of business vouchers would have to exceed the residential total value. This pooling approach can relieve some of the costs where the cost of installation is greater than the voucher issued.
The market trial of the scheme which was running across four areas of the UK saw around 1000 vouchers dispensed to small businesses. The extension of the scheme is expected to go live the end of March and run until March 2021 (providing that funding remains).
Whilst the voucher scheme has been generally very well received, it should be noted that in order to deliver maximum benefits, measures should be in place to ensure that residents and SME’s alike are made aware of its existence. It would appear that Government has learned the lessons of the previous vouchers and sought to structure the scheme to incentivise additional investment in full fibre; done right, these vouchers should make a good contribution towards the Government’s goal of having full fibre available to at least 10 million homes and businesses by 2022.
Ofcom today announced new rules that aim to increase investment in full fibre by reducing the upfront costs that building the broadband network entail.
By forcing BT to make its telegraph poles and underground tunnels available to communications providers, Ofcom estimates that the cost of laying fibre cables could be reduced by 50%.
The Government has published the Terms of Reference for a review into future investment into the UK telecoms sector, led by DCMS. The cross-government Future Telecoms Infrastructure Review will explore what makes investment in full fibre and 5G networks attractive, and what actions Government may need to take in order to deliver on its vision.
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.
It’s fair to say that the UK’s experience of community led broadband schemes has not been evenly distributed. The work of B4RN and others is nothing sort of transformational but there have been other examples of networks collapsing under financial strain or more often simply never getting off the ground. Their reputation was further tarnished by the unsuccessful Rural Community Broadband Fund. One of the complaints from communities was that there were few easily accessible case studies and tutorials. BDUK have now rectified this with a good portal containing case studies and guidance.
A recent study (h/t Computer Weekly) on the economic impact of London’s superfast broadband connection voucher scheme shows that it could bring a £3bn boost to London SMEs within two years. Carried out by Adriot Economics, and supported by Point Topic, The Fifth Sector and Manchester University, the evidence comes from around 500 of the 12,000 London businesses who benefited from the scheme.
The SME Connection scheme was launched in late 2013 as part of the Super Connected Cities scheme. Despite some initial teething problems it quickly picked up speed, benefiting from an advertising push and a streamlined application process that included the ability to aggregate vouchers. When it closed in October 2015 55,000 vouchers – a one-off grant of up to £3000 – had been issued to SMEs in over 50 cities with over 700 suppliers taking part.
This report is the first to attempt to undertake an economic analysis of the scheme – something which the BSG called for in our Small Business Connectivity Requirements Report last year. London’s scheme allocated £18m over the two years with an average cost of £1,500. This resulted in an average speed increase from 15.9 Mbit/s to 86.6 Mbit/s. The range of services delivered can be seen in the graph:
In the short to medium term this resulted in increased efficiency and sales. It also resulted in productivity gains from staff time savings and increased ability for home and mobile workers. The report also identified longer term gains in terms of using this time to increase skills – and having better access to online courses.
On a conservative basis this should provide a boost of £3bn in the first two years and an additional £4bn over five years if the latent productivity gains are realised. In terms of Gross Value Added, the economic benefit is estimated to be £430m for Greater London and an additional 8,118 jobs. That’s an extremely impressive £23 GVA per £1 invested and a cost per job of £2,200.
The report doesn’t cover additional economic benefits such as those delivered to the suppliers, nor the extent to which it stimulated the market to deliver superfast broadband services (in fairness a non-trivial task).
Whilst the report was just focused on London and, by the author’s admission, survey results are still coming in – it does seem to beg the question of should Government have stopped the scheme when it did?
In fairness, Ed Vaizey made clear to the CMS Select Committee’s Inquiry into World-Class Connectivity he wanted the scheme to carry on – he was just unable to get the Treasury to agree. That’s not to say the scheme was perfect – whilst it was born out of the Super Connected Cities Programme, SMEs in rural areas would arguably benefit even more from such a scheme. But it was still a scheme that seems to be delivering economic benefits, popular amongst SMEs and broadly welcomed by the telecoms industry. With loud noises of industrial strategy and regions pushing the message that they are open for business, don’t be surprised if we see this revived in some form…
BT-Openreach Fibre Network passes 25 Million UK Premises as UK Superfast Broadband Coverage hits 90%Charles Wood
In what Openreach describes as “one of the fastest deployments of fibre broadband in the world???, it announced yesterday that its fibre network has passed the 25 million premises milestone, helping to take the UK’s superfast broadband (24Mbit/s) coverage past 90% of premises.
Ofcom today published their initial conclusions from the Digital Communications Review that they kicked off last year. Whilst these are officially their interim findings, the direction of travel is relatively clear; over the next 10 years, the UK will move towards an increasingly all-fibre future, with widespread availability of competing fibre networks driving the take-up of ultrafast services underpinned by a USO. Against the background of convergence, Ofcom will do more to make it easier to compare quality of service across fixed, mobile and bundled offers. Openreach understandably lies at the heart of much of this and whilst BT will be sure to feel additional pain, Ofcom are not proposing full structural separation, yet.
Earlier this month, a survey by the Manufacturer’s Association (EEF) found that internet connectivity was increasingly central to manufacturer’s operations and that Britain’s success in leading the fourth industrial revolution relied on improvements to affordability and internet infrastructure. In a keynote speech at the EEF annual conference today, Business Secretary Sajid Javid announced the review of business broadband “to reduce the barriers to affordable, high-quality fibre-broadband???.
Analysys Mason today published a report comparing the UK’s fixed telecoms market to the five major European countries and several other leading digital countries. It found that the UK is currently ahead of its European competitors on measures such as average speed*, superfast broadband coverage and take-up and will soon be outperforming countries such as Japan and the USA.