High road or blind alley? BT’s campaign for “open access” to street furniture

Telecoms.com periodically invites third parties to share their views on the industry’s most pressing issues. In this article Antony Tomlinson, CEO of network builder Ontix, which has a concession agreement with the council in Westminster, shares his views on the concession model, addresses BT’s suggestion that they’re the wrong way to go, and explores what we should do to accelerate the roll-out of next-generation networks.

Local councils who want their street furniture to host telecoms equipment have generally chosen to agree concession contracts with wholesale infrastructure providers (or “WIPs”). The WIP takes on the work and the business risk, paying a license fee to the council and charging a wholesale fee to the operators.

BT was party to several such concessions, but now it is opposed to them.  In March, it called for “open access” to street furniture: indeed, it now believes that concessions are a barrier to investment, and it is proposing an alternate model in which operators engage separately and directly with the council.

BT has started an interesting discussion at a pertinent time, now we’re starting to see small cells being deployed in volume. However, if we want more small cells – plus WiFi and other technologies as well – then we can’t expect the operators to build all of it. We need more collaboration, with WIPs providing infrastructure which they can then all share. Unfortunately, BT’s proposal would prevent the collaboration that we now need more than ever.

The BT narrative

BT’s press release was cleverly framed.  It focused squarely on the concession model, as if there couldn’t really be any other reasons why more small cells have not been deployed to date. It chose targets that would resonate: councils, red tape, middlemen. It said it was now clear that concessions were a barrier.  Luckily, BT had the solution: “open access”. There wasn’t much detail on how it would work in practice, but that was for another day. The key message – a proven crowd-pleaser – was that it would “take back control”.

The reaction was interesting. Some readers found it ironic: BT hadn’t shown much enthusiasm for “open access” when other providers wanted to access BT’s ducts and poles. And was BT really negotiating here as it prepares to engage – and maybe displace – incumbent WIPs? However, a number of commentators were cautiously positive, including Jamie Davies in his article for this site (“BT pleads for open access to street furniture”).

We need small cells on street furniture.  Deployment hasn’t happened at the rate we would want to date (although we can see some significant deployments now), so we should absolutely debate what needs to change. But let’s frame our debate right. Unfortunately, BT’s narrative doesn’t do this. Their basic statements simply don’t bear scrutiny, for example:

  • There is no evidence to suggest that concessions have been a barrier to small cell deployment. On the contrary, most – if not all – of the small cells that have been deployed to date have been deployed under concessions, including in the City of London, Hammersmith and Fulham, and Aberdeen.
  • Concessions are “open”: a WIP is incentivised and contractually obliged to provide access and services to all operators on a fair and non-discriminatory basis. It is simply wrong to imply that concessions grant a single player “exclusive access to council-owned street furniture”.

It really isn’t credible to suggest that the reason there are no small cells in Carlisle and Plymouth is because of the concession, as BT has implied. We need to reframe the discussion more realistically, or we will direct friendly fire at the wrong targets.

Reality check

There are some very basic reasons why more small cells haven’t been deployed to date. The operators have been focused on macros, and upgrading them for 5G. Some operators are only just piloting small cells now. Moreover, the vendors are only just starting to produce versions of their small cells that are optimally small. Previous generations of units were often too big and heavy for our street furniture, especially if they also needed separate housings and external antennas.  Maybe we should be more realistic about why we are where we are.

There is nonetheless a more fundamental challenge that won’t fix itself.  Small cells provide less coverage and less capacity than macros, so the TCO and the lead time needs to be reduced proportionately if they are ever going to be a default solution. Unfortunately, the cost and complexity of small cell deployment doesn’t scale down easily due to several factors:

  • Deployment remains complex and costly if an operator has to do it all by itself, ie. building relationships with lots of councils, and resourcing and managing large numbers of small deployments – especially if councils have limited resources to streamline and support the process.
  • Connectivity is a major blocker if an operator needs its own fibre connection to every post.

What do we do?

Fundamentally, the operators need someone independent to deploy and manage shared infrastructure that they can license, so they don’t have to build their own “DIY”.

BT’s proposal cannot help here: it leaves operators doing it all DIY.   But the concession model can help – and it really does. In Westminster, where Ontix has a concession with the council, we are building a hybrid fibre/microwave network (“Metrohaul”) to provide high capacity / low latency / low cost connectivity to connect street furniture across the borough for different operators and different technologies – and on lead times that would otherwise be unthinkable. We are also planning a new shared antenna solution in Oxford Street, so that different operators can use the same new street furniture when the area is redeveloped. These are things that wouldn’t happen in a model that left operators to deploy on a DIY basis.

Of course, the concession needs to be set up right. The council’s priority should be the public benefit: and the WIP should be neutral.  But if it’s done well, a concession can unlock potential that would be lost in a DIY model, where operators would spend their time and money trying to landgrab assets and then build duplicate infrastructure because there was no larger strategy.

We aren’t suggesting that concessions are the only answer, or that every council should do exactly the same thing. It takes time to run a tender for a concession like Westminster. A “concession lite” might be more appropriate for a town where there’s less demand but the council wants to contract resource instead of building up its own team. Maybe some councils don’t need a concession at all. But we are suggesting that, far from being void, the concession model is very relevant.

The councils themselves are really best placed to determine their own approach, so let’s encourage them to do something – but give them the latitude to decide what to do and how to do it.

UK telcos ask for clarity sooner rather than later over Huawei – report

The UK’s largest mobile operators are reported getting tired of Government indecision, drafting a letter to Cabinet Secretary Mark Sedwill requesting clarification on the situation.

The BBC is claiming to have seen a draft in which a decision has been urged. As it stands, the MNOs are in the telco version of purgatory. The 5G world is fast approaching, but with the Government getting comfortable on the fence, no-one will want to make any investment decisions, a wrong-turn could prove to be very expensive.

In response to the rumours of such a letter, the UK Government has asked for patience.

“The security and resilience of the UK’s telecoms networks is of paramount importance,” said a Government spokesperson. “We have robust procedures in place to manage risks to national security and are committed to the highest possible security standards.

“The Telecoms Supply Chain Review will be announced in due course. We have been clear throughout the process that all network operators will need to comply with the Government’s decision.”

What is worth noting is the BBC coverage perhaps reflects a sense of urgency which is not felt by the telcos. Having reached out to contacts in the industry, the tone of urgency which has been reflected in the article does not seem to represent the climate for the telcos. It is a sensitive issue, and the message seems to be clear; we’re not going to force the hand of the Government into a speedy decision.

“We do not comment on draft documents,” said a Vodafone spokesperson. “We would ask for any decision regarding the future use of Huawei equipment in the UK not to be rushed but based on all the facts.”

“We are in regular contact with UK Government around this topic, and continue to discuss the impact of possible regulation on UK telecoms networks,” said a BT spokesperson.

That said, a decision needs to come sooner rather than later.

Currently the MNOs are in a bit of a bind. Money needs to be spent and networks need to be built to ensure connectivity in the UK meets the standards demanded of the digital economy. However, as there are so few vendors in this segment of the industry clarification on the Huawei situation is critically important.

Without Huawei, the threat of decreased competition might lead to less attractive commercial terms, which could lead to increased prices for the consumer as telcos drive ROI. Telcos will want Huawei to be included in these talks. Right now, no decisions can be made. If the telcos go forward without Huawei, they might be missing a trick, but if they do and the Supply Chain Review bans the firm, the cost of ‘rip and replace’ would be painful. The telcos are just sitting and waiting.

The outcome of the review has already been potentially leaked, suggesting Huawei would be given the greenlight. This leak from the National Security Council led to former-Defence Secretary Gavin Williamson being sacked, though this is not to say the leak is accurate. Last week, the UK hosted US President Donald Trump, and while there was no eureka moment, who knows what was discussed behind closed doors.

The US is sticking by its anti-Huawei position and has even suggested with-holding access to security data from countries who are exposed to the vendor.

That said, there might have been no material conversations held on this topic over the course of the visit. Theresa May is no-longer the political leader of the UK and Trump might have thought it nothing more than a waste of hot-air. This is perhaps one of the biggest issues which the country is facing at the moment; who knows who is going to be leading the Government over the next couple of months.

The Tory party members are going to be choosing the next leader of the Conservative party over the next few weeks, and the tone of 10 Downing Street might change. May seemed to have a much more internationalist approach to politics, though certain candidates are much cosier with the White House. Bookies favourite Boris Johnson is certainly chummier than most with the US President, though others will be in deeper conversations with US delegations than some. This could have an impact on the relationship with China in the long-term, and subsequently, on any decisions made surrounding Huawei.

The consequence of this decision is not only impacting the future of networks in the UK, but also the past. Yes, telcos are reluctant to spend now, but any decision banning Huawei would result in ‘rip and replace’ programmes. Vodafone has already stated it has Huawei equipment on 38% of base stations around the UK and having to replace RAN equipment would set its 5G ambitions back two years. Telcos would also have to consider 4G investments made over the last couple of years.

Although the other telcos have not been as forth-coming with their exposure to Huawei equipment, it would be a fair assumption the vendor’s kit is scattered throughout the network. This is not just a challenge for Vodafone or EE alone, this is an industry-wide worry.

This is not to say the UK would turn into a massive not-spot, but it would have severe implications on the connectivity ambitions of the country.

Some might have expected a decision from the Supply Chain Review in May, but we are still waiting. External factors have perhaps taken priority, the next Prime Minister and the Trump State Visit for example, but that will come as little consolidation for the telcos who are prepping investments.

The UK should not rush this decision, but the longer it leaves the telcos in purgatory the more the country slips behind in the 5G race. Uncertainty is the enemy of telcos and who knows which way this decision will go.

Broadband universal service becomes a thing in the UK

UK telecoms operator Ofcom has officially launched something called the broadband ‘universal service obligation, that supposedly entitles everyone to decent broadband.

The minimum download speed required of a broadband connection under this scheme is 10 Mbps, which really shouldn’t be that much of a problem for Openreach, especially considering the obligation doesn’t kick-in until March of next year. Having said that there are apparently 600,000 homes and businesses that still don’t have broadband up to that standard.

Despite the fact that it’s the dominant broadband supplier in the UK, BT still seems to thing being chose by Ofcom to deliver this bare minimum is a big deal. “BT is very pleased to have been chosen by Ofcom to deliver the government’s promise to connect the UK,” said BT boss Philip Jansen. “It’s great news that the majority of homes and businesses in rural areas can choose a fixed wireless service from EE to solve the problem of slow broadband and get speeds way faster than 10Mbps.

“Through Openreach we are now extending our fibre broadband network to reach an additional 40,000 premises within the USO area for whom FWA is not the answer. We’ll continue to drive discussions with Ofcom, Government and industry to explore alternative options to connect up every property in the country and ensure no-one is left behind.”

“Connecting the UK with decent broadband is absolutely key to ensuring that Britain’s digital infrastructure is fit for the future,” said John Lamont MP, Chair of the All-Party Broadband and Communication Group. “Fixed Wireless Access is already transforming people’s lives, providing a fast and reliable service that means they can do everything from everyday online tasks like banking or shopping to streaming films or playing games. There’s still lots more to be done, but this is a positive step forward in the right direction.”

It’s interesting that even the MP is banging on about FWA, presumably having been asked to do so by BT. It makes sense that BT would favour this as a cheaper way of connecting remote locations, but it still reckons over 100,000 of those will be too costly to connect to qualify for this broadband USO without chipping in themselves. So, in summary, around half a million locations that don’t currently have at least 10 Mbps broadband will be able to demand it of BT next year.

BT to close 90% of UK office locations

BT’s cost-efficiency strategy has managed to avoid the headlines in recent months, but today it has announced it will be shutting down 270 of its 300 office locations around the UK.

Unions have been very vocal opponents of the strategy, suggesting it is the telco’s way of spring cleaning, taking the opportunity to shepherd out old bodies. This announcement might be one of the first steps in the consolidation plan, as new CEO Philip Jansen looks to shore up the spreadsheets and finally realise the potential of the £12.5 billion acquisition of EE.

Snuck in with an announcement about modernising eight offices, BT will close 270 of its 300 office locations around the UK in pursuit of a more attractive profit column. If it is any consolation for the members of staff involved in the re-shuffle, these eight refurbed offices will have 5G connectivity.

Belfast, Birmingham, Bristol, Cardiff, Edinburgh, Ipswich, London and Manchester have been identified as key locations for the business moving forward. In some cases, the same office will be used, though details have not emerged on which staff will be moving into a new space.

“The Better Workplace Programme is about bringing our people together in brilliant spaces, and transforming the way we work,” said Jansen.

“Revealing these eight locations is just the first step; we have dedicated teams working on identifying the best buildings to move into and which ones to redesign for the future. As a result of this programme, BT people will be housed in inspiring offices that are better for our business and better for our customers.”

In all honesty, this is a process which BT has been forced into more than making a choice. The telcos is one of the least profitable in the larger segment, while difficulties in managing the relationship with regulators.

Redundancies and restructuring strategies are never pleasant topics to discuss, however BT does need to ensure it is a business built for the next generation of connectivity. The world has changed dramatically and at an astonishing pace over the last decade, forcing telcos to make some difficult decisions.

13,000 redundancies were announced in May last year, and there have been rumours Jansen might be preparing for another announcement in the future. The last financial results passed without any new cuts, but that is not to say there won’t be more in the future. Most of these cuts will be made in the back-office and middle-management functions, with the UK workforce taking the sharpest part of the blade.

Closing offices and consolidating operations is a sensible business decision, few companies will be blamed for making such financial decisions, though it seems to be more of a material development here. The restructuring strategy of BT is becoming very real.

BT looks to Juniper to trim the network bloat

BT has opted for Juniper Networks to deliver its Network Cloud infrastructure initiative, paving the way for BT’s Network Cloud roll-out.

The platform itself is designed to offer BT a number of different upgrades to its current position, including improvements to converged fixed and mobile services rollout to consumers and businesses, faster time-to-market for network services and improved voice and video deliverability and scalability.

The initiative will hope to roll BT’s networks including 5G, Wi-Fi and fixed-line into one virtualised service, a common framework which can be shared across all BT offices nationally and globally. Moving into the single framework will also help BT deliver cost efficiency saving, a key component of recent strategies to make the telco into a leaner machine.

Aside from the EE component of the business, BT has been one of the more sluggish players in the telco space, with the spreadsheets bearing the brunt. If BT is to make the most of up-coming connectivity evolutions, IOT and 5G for example, the business needs to be in a fitter position. This initiative is one of the strands of this plan.

“This move to a single cloud-driven network infrastructure will enable BT to offer a wider range of services, faster and more efficiently to customers in the UK and around the world,” said Neil McRae, Chief Architect at BT. “Being able to integrate seamlessly with other partners and solutions and aligning with our roadmap to an automated and programmable network is also important.”

“By leveraging the ‘beach-front property’ it has in central offices around the globe, BT can optimize the business value that 5G’s bandwidth and connectivity brings,” said Bikash Koley, CTO at Juniper Networks. “The move to an integrated telco cloud platform brings always-on reliability, along with enhanced automation capabilities, to help improve business continuity and increase time-to-market while doing so in a cost-effective manner.”

For Juniper, the bean-counters will be happy with the win, with numerous services being undertaken across different aspects of the network. Contrail Networking will be used for dynamic end-to-end networking policy and control for telco cloud workloads, AppFormix will run the cloud operations management suite, while the QFX Series also features.

New BT logo looks more like a warning than an invitation

British Telecom has filed for a trademark on a new logo but it’s a bit rubbish and the internet is ridiculing it.

Whichever brand consultancy BT has hired, presumably at great expense, to refresh its logo presumably either couldn’t be bothered to think about it properly or was given bad advice by its client. The result is simply the letters ‘BT’ with a circle around them. Black letters, black circle, white background, that’s it. Even the font is boring.

The Guardian was one of the first to cover the filing and marketing mag Campaign pointed out that its seems to be an even more stark and boring version of a rebrand it was planning three years ago, but wisely put on the back burner. At least that one had some colour in it. Unsurprisingly the internet has been quick to mock this feeble effort, with a great piece of opportunistic guerilla marketing from Poundland our current favourite.

“We’ve shared our new logo with our colleagues today and will consult them on the detail as we gradually roll it out towards the end of the summer,” a BT spokesperson told the Guardian. “Our CEO has been very clear that the new mark symbolises real change. Making every BT employee a shareholder in the company is the first step towards transforming BT into a national champion that exceeds our customers’ expectations.”

While it’s understandable that new CEO Jansen would want to spray his scent on his new company we think he can afford to take a bit longer over such a momentous decision. Right now it looks at best like a functional street sign designed to warn the unsuspecting punter about BT rather than endear it to them. Not all change is good, Phil, and you might want to give the whole thing a rethink on your summer holidays.

The real branding challenge faced by BT is how to incorporate, if at all, EE. Its brand currently goes heavy on the letters-in-a-circle theme, albeit with a bit more creative flair, so maybe BT is trying for a bit of geometric alignment or something. But as we move into the 5G era, Britain’s biggest telco should think twice before rebranding itself to look like a speed limit sign.

BT reports flat full year numbers but feels bullish about fibre

UK telecoms group BT revealed flat revenue growth on its full year 2018 report, but its new CEO said all the right things about investment.

Revenues were down a percent, but earnings per share were still up 6 percent. Of the business units only the biggest – consumer – showed any growth, with all the B2B units showing small declines. BT expects the 2019 financial year to deliver more of the same, because reasons. It said it has raised its capex guidance to £3.8 billion, but it ended up spending almost £4 billion in the 2018 financial year despite guiding £3.7 billion a year ago.

BT FY 2018 table

“BT delivered solid results for the year, in line with our guidance, with adjusted profit growth in Consumer and Global Services offset by declines in Enterprise and Openreach,” said new Chief Exec Philip Jansen.

“We need to invest to improve our customer propositions and competitiveness. We need to invest to stay ahead in our fixed, mobile and core networks, and we need to invest to overhaul our business to ensure that we are using the latest systems and technology to improve our efficiency and become more agile.

“Our aim is to deliver the best converged network and be the leader in fixed ultrafast and mobile 5G networks. We are increasingly confident in the environment for investment in the UK. We have already announced the first 16 UK cities for 5G investment.

“Today we are announcing an increased target to pass 4m premises with ultrafast FTTP technology by 2020/21, up from 3m, and an ambition to pass 15 million premises by the mid-2020s, up from 10 million, if the conditions are right, especially the regulatory and policy enablers.”

Those infrastructure ambitions are laudable, and were echoed by Openreach CEO Clive Selley, but don’t seem to tally with previous statements on the matter. A year ago Selley said “This year we’ll double our FTTP footprint and by 2020, we will have built it to 3 million homes across the UK. We want to reach 10m premises by the mid-2020s, and believe we can ultimately fully-fibre the majority of the UK under the right conditions.”

So the mid-2020s bit is fine but the 4m promise now has a revised deadline of April 2021, a year and a quarter later than the previous 3m promise. Now we might be missing something here but rather than increasing the target, all BT/Openreach seems to have done is insert another milestone a bit further down the line, which feels a bit deceptive.

“In cut throat market like the UK, there are few opportunities to grow,” said telecoms analyst Paolo Pescatore. “Moves to accelerate plans for its fibre broadband rollout, 5G and cross selling existing services can help increase the group’s bottom line but also require significant investment. The lack of any significant shift in strategy is unsurprising as it’s still early days for Philip Jansen.”

BT is hardly alone in hedging any investment pledge, however vague, with the caveat that it all depends on the regulatory environment. At least it has stopped openly begging for public money, for now. But the barely adjusted capex outlook implies even that pledge is trivial and Jansen might need to test his own investors’ patience with a more aggressive approach once he’s fully up to speed.

BT gets personal on speed guarantees

BT has announced a new initiative, Stay Fast Guarantee, which will aim to hyper-personalise speed guarantees for new and re-signing customers.

When a new customer signs-up for BT’s broadband service, or an existing customer renews a contract, they will be given a bespoke speed guarantee for their home based on the estimated capability of the line. Should the service fall below these expectations, the customer will be able to apply for a £20 refund.

The initiative also promises that if it is believed a broadband customer could get a faster line speed, BT will first remotely optimise broadband performance, or an engineer will be dispatched to improve performance.

“With our new Stay Fast Guarantee, we don’t just guarantee customers’ broadband speeds, we constantly check and optimise them, so they’ll get reliable broadband speeds all day every day,” said Kelly Barlow, Marketing Director at BT.

“If a customer’s broadband falls below their personal speed guarantee then we have an expert team of service agents on hand to get things back to normal as soon as possible – ensuring they get the best and most personal broadband experience.”

While it does sound like a promising initiative, as with all these glorious promises the fine print has to be examined.

Firstly, BT is giving itself an exceptionally wide-berth to fix any faults. Customers will only be eligible to receive the £20 refund should BT not be able to fix the fault within 30 days of it being identified. Whether this is considered a reasonable window is open to debate, though for us BT should perhaps hold itself more accountable to deliver the promised performance; 30 days is a long-time for a customer to wait for the service he/she has paid for.

Secondly, customers can only apply for the refund four times a year. If problems persist, customers are left in the lurch until the end of their contract.

Finally, ‘outages, connection faults and home wiring outside of BT’s control’ will be excluded from the refund. Although this is commonplace for all telcos when offering some sort of refund, the generic and all-encompassing nature of the language offers a lot of wiggle room.

Where BT should be congratulated is on the attempt at personalisation. Catch-all statements and promises generally fail to deliver, therefore such a granular approach to performance and customer satisfaction should be applauded.

Slowly the telcos are staggering towards what would be deemed acceptable customer service. This is a good example of such initiatives. More of the same please.

BT shows off its shiny new Nokia silicon

UK telco BT is one of the first customers for Nokia’s catchily-named 7750 SR-14s IP routing platform, which features its special FP4 chip.

Nokia first announced all this shiny new core gear a couple of years ago, but it looks like the sales cycle for this sort of thing is fairly protracted. So this is an important deal win for Nokia, but perhaps even more so for BT as it’s a clear statement of intent when it comes to investing in its core network. Apparently traffic through the BT network is growing by 40% annually so it needs to show it can handle it.

“BT’s FTTP footprint is growing on a daily basis, and we are launching 5G this year in the busiest parts of 16 of the UK’s busiest cities,” said Howard Watson, BT Group CTIO. “These technologies create an amazing customer experience, and drive people to watch more, play more and share more. We have to stay ahead of the massive traffic growth that this will bring, and Nokia are a key part of that, giving us the capacity and automation that we need.”

“Nokia’s 7750 SR-s platform, based on our FP4 silicon, will offer BT’s network the enhanced capabilities and automation needed to address continuously mounting capacity demands as it moves toward 5G,” said Sri Reddy, Co-President of IP/Optical Networks at Nokia. “Our exclusive partnership will allow BT’s converged core network to grow, and move to a programmable, insight-driven network architecture, creating a platform for BT’s growth to continue as demand for its services in FTTP and 5G expands.”

As you can see there’s a fair bit of buzzword-dropping in the canned quotes. The significance of FTTP and 5G in this context essentially amounts to the fact that network traffic is likely to keep growing rapidly for quite a while. For Nokia this is a juicy deal win in a core network market that, admittedly, is largely denied to one of its biggest competitors.