The Broadband Stakeholder Group (BSG) hosted its Annual Conference on Monday 31 October 2016 with a focus on what Brexit means for the UK telecoms sector. Our speakers gave their views on where the opportunities and risks could be for the sector pre and post Brexit. We heard from a range of experts about the key role of European national regulatory authorities in shaping EU policies and regulations and how the UK telecoms regulatory system might evolve, in particular in the context of the review of the EU framework for communications.
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.
The first lines of Matt Hancock’s speech to Broadband World Forum last week weren’t shy in setting out the general theme. Hancock’s previous speeches had shown that more than most, he ‘gets’ the role that technology can, does and may play in all of our lives. So did his predecessor Ed Vaisey. But what marked this speech out was an unapologetic focus on fibre; as he described it, the future.
The Valuation Office Agency (VOA) announced last week a fourfold rise in business rates (taxes on the value of real estates) on some major infrastructure providers’ bills. The revaluation was judged “excessive” by BT, whose Bill increases from £165m to £743m per annum, who added that the increase in rates will likely lead to higher prices for consumers and businesses. Virgin Media echoed BT’s concerns on the likely negative impact of the increase on future investment decision in telecoms infrastructure.
Increasing transparency of businesses broadband speeds – Ofcom’s voluntary Code of Practice for ISPs comes into forcesamiragazzane
Under the new voluntary Ofcom Code, Internet Service Providers commit to give businesses “clearer, more accurate and transparent information on broadband speeds before they sign up to a contract”. If the promised upload and download speeds fall below the guaranteed levels, businesses will be able to leave their contract with no penalties. The Code was launched earlier this year but comes into force today.
Comparison website finds that 77% of UK businesses are satisfied with broadband but downtime remains a problemsamiragazzane
The Broadband Genie annual business broadband report published today found that 1.5 million businesses in the UK (23% of all businesses) encounter broadband issues at least once a week, costing them on average £904 for every hour broadband is down. The broadband comparison website surveyed 500 firms from across the UK and also found that nearly half of businesses have no dedicated staff responsible for resolving issues with a broadband connection despite expenses costing between £1000 and £5000 per hour for 16% of businesses.
According to a recent survey by consultancy firm Ernst & Young, the fast evolution of the bundle market combined with significant changes in the broadband infrastructure has translated into a vast array of service offerings. This is a sign that innovation and competition in the market are alive and well, however the complexity of the bundles leave in some cases consumers confused. The report suggests that to turn dissatisfied (and willing to switch) customers into loyal customers, service providers should be doing more to tailor their bundle packages to meet the needs of the diverse range of consumers (from “digital devotees” and “loyal bundlers” to “serious about sports” and “functional users”).
The European Commission published yesterday its proposals to achieve its vision for a European Gigabit society with ambitious targets from 5G coverage to access for all European households (rural and urban) to internet speeds of 100Mbit/s by 2025. Legislative and policy proposals include a review of the EU regulatory framework for telecoms, an Action Plan on 5G connectivity and new financial instruments as well as additional public funding for a WiFi voucher scheme that will benefit 6000 to 8000 local communities in the EU by 2020.
The Broadband Stakeholder Group is delighted to invite you to our free Annual Conference on Monday 31 October 2016.
The outcome of the 23rd of June referendum naturally sparked immediate debate and considerable speculation on the future of the UK post Brexit. The BSG Annual Conference of 2016 will focus on what the telecoms sector is looking for from the UK’s new relationship with the EU – and give a taste of how we will be able to exercise influence of EU decision-making. The all-day event will see experts exploring issues specific to the UK telecoms sector, considering the challenges but also the opportunities for the sector pre and post-Brexit.
BEREC, the European body of National Regulators for Electronic Communications, issued its Guidelines of interpretation of the Open Internet rules (EU Regulation 2015/2120). In implementing the Regulation in the UK, Ofcom will need to take “utmost account” of BEREC’s recommendations. Whilst the Guidelines do not impinge on the UK’s approach to the Open Internet, they build on the new BSG Open Internet Code of Practice, recently reviewed to reflect the requirements of the new EU rules.
Ofcom published last week a summary of responses to its April 2016 consultation on the design of the broadband universal service obligation (USO). The Government proposed last year to introduce a USO of 10Mbit/s available to all premises and tasked Ofcom to produce technical advice and recommendations to support its design. 115 responses to Ofcom’s call for inputs (CFI) were received, highlighting various perspectives and approaches to achieve universal decent broadband coverage in the UK.
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…
Urban Connectivity: The Demand and the Challenges
12 October 2016 10.00-17.00
techUK, 10 St Bride St, London, EC4A 4AD
The UK’s cities are determining factors in our economic well-being, helping to drive growth and create jobs. By their nature they require resilient, high capacity and high quality infrastructure. This applies to digital communication networks as much as it does to transport infrastructure. Indeed, it may shortly matter more.
The City of London Corporation published this week a standardised wayleave agreement which should accelerate negotiations between landlords and broadband providers when agreeing to install fixed line broadband connections. Waiting time for business tenants to access high-speed internet connections should be significantly shortened.
In February 2016, Ofcom published its initial conclusions on the Digital Communications review. Much of the review focused on the need for Openreach to improve the quality of service it delivers to its customers and strengthen Openreach’s independence from BT Group. Ofcom have today set out their detailed approach for how to do this, namely, constituting Openreach as a legal entity within BT Group, stressing however that the option of structural separation remains open in case changes aren’t deemed satisfactory.