Businesses in parts of Aberdeen already have access to Gigabit broadband via the CityFibre metro network and now consumers are set to benefit as the ultrafast broadband roll-out is set to hit the city and is being described as reaching almost every home and business in the city.
Our commitment to Aberdeen is further evidence of the action CityFibre is taking to deliver Britain’s full fibre future. Our existing network in Aberdeen provides us with an eighteen-month head-start on a full fibre roll-out to nearly every home and business in the city. With similar FTTP backbone networks already built in over 40 UK towns and cities, our contribution to national full fibre coverage is well underway.
We are getting on with the job of building Gigabit Britain – at full speed. Greg Mesch, Chief Executive at CityFibre
This is now the second area of the UK to benefit from the Vodafone and CityFibre partnership that is aiming to roll-out full fibre to 1 million premises and around 12 cities. Vodafone will market and sell its ultrafast Gigabit service with CityFibre building and operating the local network.
It is said that the roll-out in Aberdeen will involve at least GBP40m of private funds and with over 117,000 premises that gives a per premise estimate of GBP341 which is the ball bark figure for deploying FTTP using techniques like micro trenching which is faster and less damaging to pavements that traditional trenching. The big question is when and work is set to start in July 2018 and one presumes that once Vodafone launches its ultrafast service in early 2019 that parts of Milton Keynes and Aberdeen will be ready for live service. If you are really keen you can pre-register interest at www.vodafone.co.uk/broadband/ultrafast.
Aberdeen City and its broadband statistics already show the city with 96.1% superfast coverage (30 Mbps and faster) but full fibre coverage from Openreach is low at 0.7% but has been slowly changing as new premises are built.
So how much this roll-out will help Scotland reach its R100 all depends on what is actually meant by ‘nearly every home and business will have access to gigabit-speed broadband’, there is no confirmed undertaking in the press release that 100% of those who cannot get superfast now will be covered, so it might be 99.999% coverage or it might be 99% once the project completes will have to wait and see and importantly what will happen with new estates and things like large homes being convered to flats once the CityFibre roll-out has left town.
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Rural homes in Scotland could access superfast broadband through a new 4G antenna rather than underground cables. Mobile provider EE has trialled the service in Cumbria and believes it could connect 80,000 rural homes in Scotland to much faster internet speeds. The company, part of BT Group, installed routers along with an external antenna to connect to its 4G network and recorded internet speeds over 100Mbps in the Northern Fells area of Cumbria.
It said the scheme has been designed specifically as an alternative for those in rural communities that have yet to be connected with traditional fixed line broadband access. Campaigners have argued that poor broadband and mobile coverage is a barrier to economic growth in parts of Scotland, with weak connectivity making it more difficult to attract people to live and work in remote and rural areas.
EE believes the antenna could connect 80,000 homes to superfast internet speeds (Mark Runnacles/PA)
EE’s 4G network covers 90% of the UK’s landmass and the company said there are 80,000 rural homes in Scotland which could benefit from the solution. Managing director of marketing, Max Taylor, said: “As our network continues to expand into some of the most remote parts of the UK, we’ve seen the amazing impact that 4G connectivity can have on rural communities.
“Our newest 4G home broadband router and antenna takes this one step further, ensuring thousands of families in rural areas across the UK could enjoy the benefits of superfast broadband inside their home for the very first time – whether video-calling the grandparents or streaming their favourite TV series.”
Another week another three million premises of full fibre has been announced this time by TalkTalk as a key part of its latest financial results. The location of the three million homes and businesses is unknown as are any time scales for when they will reach the 3 million target, but we presume its a lot faster build rate than the expansion from 14,000 to 54,000 premises in York which is set to finish in 2020. The new build involves setting up an indepedent company with Infracapital who are an equity investment arm of M&G Prudential, with TalkTalk operating as a founding wholesale customer and funding of 20%.
The immediate effect of this is that the dividend is temporarily reduced as an initial GBP200m is raised and as we guess a sign of commitment the Executive Chairman and other Directors are to contribute up to GBP40m. No contracts appear to have been signed but what is described as ‘heads of terms’, which in non city speak means things have been agreed in principle. Of course more full fibre is welcome news, and this new rush has been many years in coming and for those saying rule changes and other factors are the reason why, while they may have a part to play, the fact that superfast roll-outs are almost over in the urban areas of the UK and as TV viewing as emerged as the killer app broadband operators are keen to roll-out networks that should provide a TV platform as reliable or more reliable than the existing cable TV network and while the broadband is unlikely to be a big source of profit for many years, the profits in the short to medium term will come from selling access to movies and boxsets.
Another factor is that the revenue from telephone calls has vanished and from 2006 onwards the profit was not the broadband but from the call revenue. What is most interesting is that the York full fibre trail was in partnership with CityFibre, but this latest announcement does not mention them and means that while the Gigabit City labels of CityFibre give a clue as to where Vodafone is likely to go with its 1 million premises, there are no clues for the TalkTalk roll-out. By creating this new venture it also makes it easier to be acquired and the equity investors to get their return once the full fibre market starts to merge, this might be a decade away but the experience from the cable franchise market suggests we will reach that point eventually.
After more than two years wasted by many operators who were campaigning for the full seperation of Openreach from the BT Group, we are now looking at a situtation where the only major broadband retailer outside BT Consumer who is not embarking on their own full fibre roll-out is Sky and thus we are looking at a scenario where Openreach is regulated heavily but only has 1 or 2 major wholesale customers, while competitors have masses more freedom to do as they wish, either operating vertically integrated networks or wholesale services on their own terms. One almost thinks that the campaign for a split was more about limiting what Openreach can do to respond to these networks rather than creating a services that would be attractive to retailers. We predict that if Sky announces a full fibre build or intent to be a big customer for one of the competing networks that BT will be looking for lots of rule changes in the areas the new networks are emerging, e.g. full commercial freedom in areas where cable and a full fibre operator are present.
Predicting the coverage levels for full fibre broadband across the UK is becoming impossible now as we expect there to be massive overlaps, but the danger with the overlaps is that the nimby factor will have some residents blockading the second or third operator to bring their trenching machines and fibre down their street. To some extent there is already a steady trickle of complaints over the Virgin Media expansion and in some areas where full width re-instatement is insisted upon expansion may stop in some areas. For any public funded roll-outs in procurement in 2018, e.g.
Wales and Scotland the indicators are very much that if there is not a high proportion of full fibre involved the procurement could be described as a failure.
We strongly welcome this commitment by Talk Talk to take full fibre broadband to 3 million homes and businesses in the UK. This investment will make significant strides in giving Britain the connectivity we need to be fit for the future. It’s fantastic to see Talk Talk stepping up to the plate – we want a healthy, vibrant, competitive next generation broadband market and are working hard to deliver the investment and good jobs that comes with it.
DCMS Secretary of State Matt Hancock
Back to the TalkTalk of today and its Q3 financial year 2017 results, their added some 37,000 on-net customers during the quarter, which is the fourth quarter of growth after a turbulent period and the fixed low price plan (FLPP) means that they have 1.8 million customers in contract (61% of the retail customers) and people are fixing their prices for longer periods 18 and 24 months, rather than the shorter 12 month. This is not that surprising as wage growth for many is still a dream and fixing the cost of utility bills helps with budgeting and a Friday night in with a boxset binge is vastly cheaper than a night out. The VDSL2 (FTTC) services are growing with 89,000 additions in the quarter and for customers joining TalkTalk 40% of new customers take a fibre based service.
There will be a few York FTTP customers but no specific numbers are given other than to say customer satisfaction is high and churn levels are minimal, given how good FTTP is meant to be one would hope for zero churn levels, but the network does overlap in places with other superfast and ultrafast options so it does have price and bundle competition.