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Rural broadband needs competition, not cash

Wednesday, March 5th 2014 by Hannah Langston
Fast broadband can be delivered to rural areas, but not by BT alone.

Another week, another tale of rural broadband woe. Property expert Henry Pryor has revealed houses without broadband could be worth 20% less than similar properties with a fast connection[1]. This isn’t surprising to those of us who consider broadband to be ‘the fourth utility’ but unlike the water, electricity and gas supplies to our homes, broadband is not yet available to everyone and for many users in rural areas, slow speeds make it pretty much useless.

The government has made clear that fast broadband for rural communities is a priority by throwing £1.2bn of taxpayers’ money into the pot. However, the pot currently belongs to BT, having won all of the UK’s rural broadband contracts so far, and it’s looking doubtful that anyone else will get a share. Originally 16 organisations had shown interest in the rollout[2] but all apart from BT have pulled out. The reasons why are purely speculative but a key question remains: can BT alone solve our rural broadband woes?

The answer is a simple no. Healthy competition is key to ensuring consumers receive the best possible service. When you open the rural broadband market up to competition then every area of the UK has the potential to receive fast broadband and in fact rural areas could get speeds up to ten times faster than their nearest cities.

Enter the little guys – the community broadband initiatives or ‘altnets’ that can deliver speeds of up to 1Gbps in their local area. Broadband for the Rural North (B4RN) is bringing an up to 1Gbps service (noticeably higher than BT’s top speed of 300Mb and Virgin Media’s 152Mb offering) to 350 homes in the Forest of Bowland and the Lune Valley. The majority of these projects deliver Fibre-to-the-Home (FTTH) broadband whereas BT’s infrastructure relies on the old copper wires to take fibre from the green street cabinets into customers’ homes.

Crucially, altnets can install fibre broadband for around 34% subsidy while BT’s rollout demands nearly 90% state aid[3], according to the Independent Networks Cooperative Association (INCA). BT has kept tight-lipped about it’s costings and how the 1.2bn will be divvied up – a move which received criticism[4] from both the National Audit Office (NAO) and the Public Accounts Committee (PAC) who expressed concerns over BT’s apparent lack of transparency[5]. PAC Chair Margaret Hodge MP previously blasted BT for threatening to only install fibre in non commercially viable areas if there was taxpayer or government funding available. Tech blog Br0kenTeleph0n3 accused the provider of making it difficult for altnets to provide coverage without overbuilding BT’s subsidised coverage areas[6].

Along with BT, local authorities have a key part to play in fuelling competition. Recently, the Cotswold broadband scheme in West Oxfordshire and the Trailway project in North Dorset were dropped by their respective councils. The latter was told that BT was intending to upgrade the same area and had already signed a contract with the council[7]. Authorities need to consider alternatives that represent value for money and demand clear information from BT regarding coverage maps and timescales. Greater technical training among council representatives can help them to identify the best option for their residents.

Let’s not forget that the government’s BDUK project covers 90% of the UK. In hard to reach areas, local initiatives are going to be the only way communities can keep up with the rest of the country’s speeds. Take B4RN for example who are covering an area that doesn’t feature in BDUK’s rollout plans and would otherwise have been left to suffer with slow speeds for the foreseeable future. These little guys are filling the gaps BT will leave – we need to start giving them some credit.

The rural broadband community fund, although heavily criticized, is now starting to back such projects – with funding pledged to schemes in Rothbury in Northumberland and Northmoor in West Oxfordshire. But a collaborative effort is needed from all three parties: councils, BT and government, to encourage competition. Without it the UK’s target of having the ‘best superfast broadband network in Europe by 2015 2017’ could slip further away.

References

  1. http://www.theguardian.com/technology/2014/mar/02/fast-broadband-vital-to-homebuyers
  2. http://www.managementtoday.co.uk/news/1189166/super-fast-broadband-rollout-super-slow-says-audit-office
  3. http://www.inca.coop/inca-statement-rural-community-broadband-fund
  4. https://www.nao.org.uk/report/the-rural-broadband-programme/
  5. http://www.parliament.uk/business/committees/committees-a-z/commons-select/public-accounts-committee/news/rural-broadband-report/
  6. http://br0kent3l3ph0n3.wordpress.com/2014/02/27/how-to-get-better-value-from-that-250m-for-rural-broadband
  7. http://www.bbc.co.uk/news/technology-24919148

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