Comments from Scottish Rural Economy Secretary Fergus Ewing raise more questions than answers

We have had years of reading press coverage of the superfast broadband projects and sometimes where projects are very clear about targets e.g. % premises above 15 Mbps all too often this has morphed into the word superfast and thus creating confusion and expectation down the line. The R100 project may be suffering from this already, or there is the possibility that the write up in the Evening Telegraph does reveal some nuances that are worth highlighting.

The cash boost, included in the Scottish Government’s draft budget, forms part of a plan to roll out the technology to all homes and businesses in Scotland by 2021. In a statement at Holyrood, Rural Economy Secretary Fergus Ewing said the initial phase would focus on rural areas as he believes coverage gaps in cities “should be filled by commercial suppliers”.

He said procurement for the new scheme is likely to take at least a year but he expects suppliers for each of the three regional sections to be ready to start building by spring 2019. Mr Ewing said the new programme would build on the current broadband scheme but include the need to provide backhaul in rural areas – connecting the core network with access points. He said: “The GBP600 million investment that we will make is fantastic news for Scotland’s rural and island economy and a real statement of the Scottish Government’s intent to make Scotland a truly world-class digital nation.

“This investment will transform the economic prospects of rural Scotland.” He added that around 245,000 premises in Scotland currently cannot access superfast broadband and the initial investment will cover a “significant proportion” but the rest would be covered in future phases.

The points of note are:

  1. The by 2021 is actually by the end of 2021
  2. The clause about the central belt area not covering urban 1 areas is what is being referred to and thus is going to be reliant on what the EO infill work BT does in the current contract and expansion from operators such as Virgin Media and Hyperoptic. There are parts of the city centres marked down for FTTP and this may actually be commercial Openreach as part of their 2 million expansion.

    Clearly this is something that we need to keep eye on.

  3. Including backhaul, seems an unusual comment to make, since you would never expect an operator to win a contract and wire up an area and have not thought of how to connect this back to the broadband providers. This may be a recycle of the old ‘digital pump’ phrase that was popular in 2009/2010. Another posibility is a consortium with a large metro fibre provider who deliver long distance dark fibre for smaller local providers to then build out with a mixture of full fibre via the metro providers contractors or their own fixed wireless network.
  4. Describing the GBP600m as initial investment is somewhat worrying and what is a significant proportion, this suggests that the Scottish Government is expecting this intervention to need topping up beyond the GBP600m and they are already caveating that while they may hit 95% superfast in March/April 2018, it may only push onto 99% or similar for 31st December 2021.

The timing of the release Ofcom Connection Nations 2017 report is not helping as we have politicians if they want figures to look bad picking the Ofcom data analysis which is based on coverage data supplied by providers in April/May 2017.

BT in Scotland in particular has ramped up its delivery of EO cabinets, infill and FTTP has started to appear since May 2017 and this explains why the gap between England and Scotland has narrowed in the last 8 months. We would add that while the 95% superfast target is expected to be met in 2018, we do expect BT to carry on with both commercial and additional phase I work in Scotland until the end of 2018, since as with all the other areas of the UK there are VDSL2 cabinets that get pushed to the back of the list due to issues such as roadworks/power supply issues and with the priority of work for several years being on the BDUK contracts it is common to see old commercial cabinets finally being enabled five or seven years after those living in the area first got wind of being in the commercial upgrade programme. Based on past BDUK contract delivery timelines, if the R100 contracts are signed in November 2018, we would not expect any significant volume of work until the summer season, particularly if the contracts don’t go to BT as other infrastructure operators will need to do a lot of survey and ground work.

All these questions are perhaps why Westminster has gone with the LFFN expansion scheme for anything beyond the existing BDUK contracts in England and the broadband USO once it is set into concrete, i.e. with a voucher scheme you don’t have lengthy procurement processes but once the same operator(s) starts to get lots of vouchers in an area there may be challenges over State Aid.

It is also much harder to measure what has and has not been delivered for the money.


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