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.

Broadband speeds are up but UK’s fibre is still lagging

Ofcom has proudly proclaimed the majority of UK can now access ultrafast broadband at home and at work, but its fibre diet still leaves much to be desired.

According to the watchdog’s latest Connected Nations report, 53% of UK properties, residential and commercial, can access broadband speeds of 300 Mbps, often referred to as ultrafast. While this might sound impressive, Ofcom also slipped in that fibre connectivity is now up to 7%, a 1% increase from the last report in September.

“For the first time, a majority of homes and offices can now get ultrafast broadband – which allows people to work, stream and shop online at the same time,” said Ofcom CEO Sharon White.

“We’ve also seen the number of homes that can’t get broadband fall by a third in the last year. I think that progress is really encouraging, but it’s vital we keep it going. So, we’re working with the Government to bring in the new universal broadband service, which will give everyone the right to request a decent connection. We’ll announce who’ll deliver the scheme in the summer.”

As it stands, roughly 95% of the population can access superfast broadband, speeds of 30 Mbps, while 53% can achieve ultrafast speeds, more than 300 Mbps. Only 619,000 premises throughout the country cannot get what is deemed ‘decent’ speeds, more than 10 Mbps, though soon these users will be able to request appropriate connections under the Universal Service Obligation (USO), which is supposedly getting underway in the next couple of months.

Having finished its consultation in February, Ofcom proposed that BT and KCOM should be designated as the Universal Service Providers, though the final decision is set to be published in the summer. This, in theory, should bring the final 2% of premises into the world of ‘decent’ broadband speeds.

Although the availability of ultrafast broadband has increased quickly over the last couple of years, ultrafast connections were available to less than 2% of the population in June 2016, progress on fibre has been sluggish. Since May 2017, fibre availability across the country has increased from 3% to 7%.

While progress is progress, one would have to assume it would have to speed up should Ofcom want to meet government ambitions. The aim here is to have 15 million homes fed a fibre diet by 2025, with the whole country covered by 2033.

Looking at the fibre connectivity conundrum, the results are quite varied. In England and Wales, fibre penetration sits at the average of 7%, while it up to 16% in Northern Ireland and down at 5% in Scotland. Unfortunately for the Scots, 4% cannot access 10 Mbps either, while 5% are living in the slow lane in Northern Ireland.

Looking at how this compares to other countries, it is a bit of a mixed bag and questions the claim as to whether the UK is the leading digital nation politicians often so proudly proclaim.

Austria Targeting 99% coverage for all by 2020 for ultrafast broadband. Fibre penetration of 1.5%
Bulgaria 100% coverage with at least 30 Mbps until 2020, and 50% take-up rate for 100 Mbps. Fibre penetration of 32.2%
Cyprus At least 30 Mbps for all households and businesses by 2020
Denmark 100 Mbps download and 30 Mbps upload speeds available for all households and businesses by 2020. Fibre penetration of 19%
Finland By 2025 all households should have access to at least 100 Mbps connections. Fibre penetration of 25.6%
Germany 50 Mbps for all households by 2018. Fibre penetration of 2.3%
Hungary 100 Mbps take-up for 50% of the households by 2020
Italy Availability of services above 30 Mbps for all by 2020
Lithuania 100% coverage with 30 Mbps by 2020. 100 Mbps subscriptions for 50% of households by 2020. Currently has fibre penetration of 46.9%.
Malta Already achieved 100% broadband coverage with 30 Mbps
Poland 50% of households should have internet connectivity of 100 Mbps by 2020. Forecasts 100% of households should have access to internet connectivity of at least 30 Mbps by 2020. Only has 5% fibre penetration
Romania By 2020, 80% of households with access to over 30 Mbps broadband and 45% of households with subscriptions over 100 Mbps
Slovenia 100 Mbps to 96% of households by 2020
Sweden By 2020, all households and companies should have access to broadband at a minimum capacity of 100 Mbps and by 2025. Currently has fibre penetration of 43.6%
Belgium Aim is to provide speeds of up to 1 Gbps to half of the country by 2020
Croatia 100% coverage with 30 Mbps and 50% take-up rate for 100 Mbps until 2020. Fibre penetration of 1.9%
Czech Rep 30 Mbps for all households and at least 100 Mbps for 50% of the population by 2020. Fibre penetration of 14.6%
Estonia Full coverage with connections of at least 30 Mbps by 2020 and aims to promote take-up of ultra-fast subscriptions with at least 100 Mbps with the objective that these account for 60% or more of all internet subscriptions by the same year
France Targets of ultra-fast broadband access for all households by 2022
Greece 100% broadband coverage with minimum speeds of 30 Mbps with at least 50% of households benefiting from 100 Mbps by 2020
Ireland 77% coverage of high-speed broadband by the end of 2018 and 90% coverage by 2020
Latvia 100% coverage with 30 Mbps and 50% household penetration with 100 Mbps by 2020. Currently leading the European race for fibre with 50.3% fibre penetration
Luxembourg National broadband plan aims for networks with ultra-high-speed rates, more precisely 1 Gbps download and 500 Mbps upload for 100% of the population in 2020
Netherlands Currently, almost 98% of urban and rural areas in the Netherlands have been covered with 30 Mbps
Portugal 30 Mbps for 100% of the population and a coverage of at least 100 Mbps for 50% of all households until 2020
Slovakia 30 Mbps for 100% of the population and a coverage of at least 100 Mbps for 50% of all households until 2020
Spain 100% coverage of 30 Mbps and 50% take up of 100 Mbps and more of households by 2020. Currently has 44% fibre penetration

This is where you have to be a bit more careful when reading the statistics and claims. Ofcom numbers are suggesting 7% fibre across the country, but this is 7% of premises who have the availability of fibre. The figures in the table, from the FTTH Council Europe, are looking at the number of actual subscribers. For the UK, the FTTH Council Europe estimates the UK has a fibre penetration of 1.5% when you count subscribers.

That said, it is easy to be very doom and gloom here. Ofcom can only force the hand of availability, it cannot force consumers to upgrade to the best available service. As mentioned before, progress is being made, though it is always useful to place these figures into a bit of context.

“While the number of households which can access superfast and ultrafast broadband continues to grow, uptake of these faster speeds remains the challenge for the broadband industry, with fewer than half of broadband users subscribing to the better services,” said Richard Neudegg, Head of Regulation at uSwitch.com.

On the mobile side, coverage is also looking perfectly suitable for the moment. Using crowdsourced data from consumer handsets, Ofcom estimates the signal levels needed to meet targets are available at least 95% of the time.

78% of the UK’s geographic area is now covered by all four operators for calls, up eight percentage points from June 2017, however, 5% of the UK’s geographic area is served by no operators. Outdoor access to decent quality data services through 4G has also increased from 48% to 67% over the same period, varying dependent on the telco. Not-spots in total have decreased to 8% of the UK from 21% in June 2017.

Looking at indoor coverage, 78% of UK premises can now receive a decent 4G signal from all operators, up 14 percentage points from June 2017. This again varies depending on the individual regions, Wales and Northern Ireland are below the national average at 73% and 59% respectively, though the numbers are steadily heading in the right direction.

Finally, the transport network. 57% of all A and B roads now have 4G coverage from all operators, while 4% are designated not-spots. This is for data services however the number drops to 2% when you are looking at calls.

UK advertising watchdog ties itself in knots over broadband marketing

The UK Advertising Standards Authority has ruled that Vodafone’s ‘Gigafast’ service was misleading because some people might reckon that means 1 Gbps.

In reality the brand referred to a range of broadband packages, the fastest of which could still only manage an average of 900 Mbps. Virgin Media thought this was a bit cheeky and so grassed Vodafone up to the ASA, which today upheld the complaint on the grounds that, while some people wouldn’t read much into it, some punters might reckon they would be getting at least 1 Gbps when they weren’t.

“The ASA considered that many consumers would likely understand the prefix ‘Giga’ to be a hyperbolic description of speed, and would therefore generally understand ‘Gigafast’ internet was very fast broadband,” satated the ruling. “However, we considered that a significant proportion of consumers would have sufficient knowledge of broadband terminology to understand Gigafast Broadband as a reference to a service capable of providing speeds of 1 Gbps (1000 Mbps).”

Contrast this with the ASA’s previous ruling on the use of the term ‘fibre’ in broadband marketing. Its conclusion in that case was that hardly anyone would think fibre meant 100% fibre, so it’s fine to just chuck the term around even if loads of the connection was actually over copper. How come people understand giga to mean 1000 Mbps but don’t think fibre means fibre?

To be fair to the ASA there was an additional complicating factor in this case, which is that Vodafone apparently kept banging on about the £23 price point in its Gigafast marketing, when that price only gets you an average speed of 100 Mbps, with the 900 Mbps one costing £48 per month. That seems to be the thing that the ASA most objected to, implying it’s fine with a 900 Mbps average service being called gigafast despite having previously ruled that ‘up to’ claims weren’t allowed.

“Although we considered that the website made clear that Vodafone Gigafast referred to a range of packages which were not all capable of providing 1Gbps, because it implied that consumers could get a service that offered speeds of 1Gbps for £23 per month, when that was not the case, we concluded that it was likely to mislead,” concluded the ruling.

The ASA seems to be increasingly confused about broadband marketing. It seems fine with labelling a package of services, the fastest of which only averages 900 Mbps, as Gigafast and with calling a partly copper connection fibre. At the same time it objects to the use of ‘up to’ in describing broadband speeds and is touchy about ambiguous pricing claims. It needs to either be laissez faire or authoritarian, but right now it seems to jump between those positions on a case by case basis.

CityFibre calls BS on high court fibre ruling

The UK high court has rejected CityFibre’s appeal against an ASA ruling that it’s OK to market copper connections as ‘fibre’.

Back in 2017, while ruling that the use of ‘up to’ speed claims was misleading, the Advertising Standards Authority also concluded it’s fine for advertising to refer to fixed line connections that contain some copper as ‘fibre’. The rationale seemed to hinge on some research that concluded consumers aren’t very influenced by the term and that it’s just a generic indicator of superior speed anyway.

These are clearly highly questionable conclusions. Fibre obviously refers specifically to optical technology that produces far superior performance to even the most advanced copper. Furthermore if consumers don’t know that surely at least part of the reason because they’ve seen copper referred to as fibre. Lastly if it’s of so little consequence in influencing consumer buying decisions then why is it so widely used in marketing?

Fibre specialist CityFibre wasn’t happy with this woolly definition of fibre, quite reasonably concluding that it presented a direct threat to its main unique selling point, and managed to get the high court to conduct a judicial review of the ASAs conclusions on fibre marketing. Yesterday Justice Murray announced his conclusion that he had no problem with the ASA’s decision.

“I am not persuaded by the claimant that the Decision was irrational,” wrote Murray. “It is clear from the evidence that the ASA had regard to the recognised benefits of full-fibre. The differential between part-fibre and full-fibre broadband services was, in fact, reflected in the guidelines set out in the ASA’s conclusions in the Decision. The ASA’s conclusion that the technical superiority of full-fibre over part-fibre was not relevant to the question it had set itself (namely, what consumers understand by fibre claims in broadband advertisements) was not irrational.”

“We are disappointed by today’s result because we continue to believe it is not right for consumers to be misled into thinking copper-reliant connections are ‘fibre’ broadband,” said Greg Mesch, CEO of CityFibre. The decision is particularly disappointing in light of the recent progress made in other countries which have restricted misleading advertising and established clear rules to distinguish full fibre from inferior copper-based services. We are currently considering appealing the judgement and would like to thank the thousands of people that joined our campaign and signed our petition for change.

“Full fibre infrastructure is being deployed at pace in the UK and will soon be within reach of millions of consumers. We welcome the Government’s recognition of the need for clarity in broadband advertising to ensure consumers can make an informed choice. We are also encouraged by DCMS’s focus on this critical issue in its proposed Statement of Strategic Priorities. The technical benefits of full fibre infrastructure are unquestioned and we will continue to work closely with DCMS, Ofcom and the ASA to ensure consumers are able to distinguish full fibre networks from copper-based alternatives.”

“We welcome the Court’s decision which finds in the ASA’s favour on all grounds and dismisses CityFibre’s arguments,” said an ASA statement. “The review of the evidence we undertook to arrive at our position on the use of the term ‘fibre’ to describe part-fibre services in ads was based on robust methodology and open minded analysis of all of the arguments. The process we followed to test if the average consumer is being misled by the use of the term “fibre” to describe part-fibre services is the one we have used to protect UK consumers from misleading advertising for many years and we are pleased that the Court has supported our approach after a hard fought legal process.”

While we’re the first to call out Mesch and CityFibre for excessive moaning it’s hard not to feel sympathy for them in this case. While the average consumer probably won’t know much about the underlying technology, if they buy something sold as fibre, they presumably expect it to be fibre. Since it’s known that the presence of and copper significantly reduces the performance of an otherwise fibre connection, for the term to mean anything it should surely mean 100% fibre.

Trump calls for US 5G leadership once more

At a press conference the US President endorsed FCC plans to improve the country’s position in the global 5G race.

President Trump likes to cherry-pick the people who stand behind him when he is public speaking and, as well as FCC Chaiman Ajit Pai, on first glance he had what appeared to be a Village People tribute band in attendance. As you can see from the video below, however, they turned out to be telecoms engineers and some kind of rural broadband lobby group.

The main theme of Trump’s introduction to the latest 5G initiatives was the need for the US to be the world leader in 5G technology. He apparently views 5G as a key component in his geopolitical tussle with China and had previously tweeted his enthusiasm for the technology, even going so far as to bring up 6G in the process, a step too far he seemed to acknowledge in this speech.

He then made way for Pai, who announced a bunch of initiatives designed to make Trump’s 5G dreams come true. This wouldn’t be the US if the plan wasn’t encapsulated by a forced acronym and in this cast we have FAST, which stands for Facilitate America’s Superiority in 5G Technology. Here are the essentials of the FAST plan, which you can read more about here as well as watching Pai’s presentation below.

Spectrum

Later this year, the FCC will auction the upper 37 GHz, 39 GHz, and 47 GHz bands. There were only vague aspirations offered about mid and low band spectrum as well as unlicensed spectrum

Infrastructure Policy

They’re trying to make infrastructure investment more attractive as well as reducing the bureaucratic hassle around deploying small cells.

Modernizing Outdated Regulations

This includes the net neutrality dispute, ease of access to cell sites, investment in fibre and of course the ongoing matter of keeping Chinese companies out of the network.

Since you have all the footage below we won’t bother extracting any written quotes, noting only that Trump moves on to troll critics of his immigration policy towards the end of the speech, which is quite amusing. The most substantial criticism of the FAST plan seems to be the lack of activity around mid band spectrum which will, initially at least, be much more useful for 5G than all that millimetre wave stuff they’re currently focused on.

 

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.

Virgin Media rumoured to be considering Openreach competitor

Virgin Media is sitting firmly in the middle of the rumour mill, with reports suggesting the team is considering opening-up its network as a wholesale connectivity competitor to Openreach.

For the majority of ISPs in the UK, there is very little option aside from working with Openreach. This position lead to a prolonged battle between Openreach parent company BT and the UK Government in an effort to separate the wholesale business from the group, and while the dust has settled, most feel the outcome is rather unsatisfactory. However, according to The Telegraph, Virgin Media is considering creating competition in this segment.

Should the move turn out to be true, it would be welcomed by many of the ISPs around the country. That said, Virgin Media and its parent company Liberty Media are keeping coy on the situation.

“We have the best broadband network in the UK and everyone knows it,” a spokesperson said. “We’re not surprised by this speculation but have no comment.”

While it is a slightly playful comment which will bring a smile to some faces, the firm has stopped short of out-rightly denying the report. This might lead some to believe there is an element of truth to the reports, others will simply suggest this is PR 101.

Although Openreach is still in an incredibly dominant position when it comes to the wholesale business, pockets of competition are emerging. CityFibre is leading the charge here, using an injection of funds from Goldman Sachs to built on its fibre footprint across the UK. CityFibre now has fibre infrastructure projects across 51 towns and cities, providing active and dark fibre services, most notably to Vodafone which is building its presence as an ISP.

The idea of emerging competition does seem to be spurring the sluggish Openreach into action, as the team has announced one million homes now fall into its fibre footprint. Openreach, and BT as the guiding hand, has often been criticised for lack of foresight when it comes to connectivity. For years, the team pursued fortunes via G.Fast while the industry was demanding fibre, with this inaction perhaps creating the fuel for the emerging competition.

While CityFibre still has the tag of a plucky outside bet, Virgin Media would certainly provide more food for thought. With 14.4 million homes passed throughout the UK, roughly 50% of households, it is a genuine alternative for ISPs who have nationwide ambitions.

We suspect such conversations are taking place behind closed doors in the Virgin Media offices. The UK infrastructure wholesale market is certainly primed for a shake-up, and Virgin Media has the footprint to capitalise.

Toob joins the UK alt-net revolution

Portsmouth start-up Toob is the latest to cash in on the consumers fibre appetite with £75 million of initial funding, backed by Amber Infrastructure.

Focusing on Portsmouth, the firm will aim to build a network to support 100,000 fibre connections by 2021, with the first to be hooked up by the end of 2019. The start-up was founded by former Vodafone executives Nick Parbutt, who will act as CEO, and Mike Banwell, CFO, while experienced executive Charles McGregor will act as Chairman.

“We are delighted to be partnering with Amber Infrastructure and to have secured Charles as Chairman. toob now has the right people, the right plan and the right funding in place to capitalise on the exciting opportunity ahead of us,” said Parbutt. “We want to enable families, businesses and communities to live, work and play in ways which are only made possible with the advent of gigabit broadband.”

“The amount of internet data used by people in the UK is growing by around half every year,” said Jonathan Oxley, Ofcom’s Competition Group Director. “So, we’ll increasingly need full-fibre broadband services like this to provide faster, more reliable connections and capacity to our homes and offices. These plans are another example of full-fibre being used to build broadband that can support the UK’s digital future.”

The alt-net revolution is starting to roar, and the signs are looking much more positive for fibre-enthusiasts across the UK. Although the UK is currently one of the least equipped to handle the blossoming digital economy, despite what politicians say to you, the industry is starting to get itself into shape. The alt-nets can claim some of the plaudits for this progress.

Although CityFibre developed a reputation for being a bit of a victim in years gone, the proposition was ahead of its time. Few other operators in the UK considered fibre as a priority, though CityFibre focused on developing fibre spines in large towns and cities across the country and is now reaping the benefits. The success has spurred confidence in other alt-nets such as Hyperoptic and Gigaclear, though more are emerging every year.

The issue some of these businesses might face in the future is scale. Fibre is an expensive segment to operate in, and the demanding nature of the UK consumer is forcing the price of connectivity down each year. CityFibre is in a strong position, the tie up with Vodafone is important as are other enterprise relationships, while Hyperoptic and Gigaclear also have established businesses now. Those who are late to the party, might have trouble achieving scale when the price and civil engineering complications are considered.

While the alt-nets are critical in accelerating the pace of change and rollout of fibre across the UK, there might need to be some consolidation should more small providers emerge in the future. This of course will not matter to the UK Government however, which has been searching for ways to entice the industry onto a fibre diet.

Back in 2015, the then Chancellor of the Exchequer George Osborne floated the idea of a new fund for alt-net providers, perhaps realising there was a need to force change through competition and the threat of loss. What should be worth noting is Openreach’s decision last week to launch an industry consultation on the switch to full-fibre, the first step in retiring the legacy copper network.

The alt-nets have been a contributing factor to the changing of the status quo, demonstrating there is a consumer appetite for fibre connectivity, but also highlighting the poor position of Openreach.

There are of course those who would suggest fibre connectivity is not necessary, though a decade ago who would have said we would have been craving the speeds of today. The issue is not whether we need the speeds fibre promises, but readying business and people for the usecases of tomorrow. Who knows what wonderful ideas will emerge, but when the creatives and innovators get their hands-on fibre connectivity speeds, but they will design products and services for these speeds. Fibre connectivity today is more about readiness.

For those who are desperately preaching the case for fibre connectivity, the alt-nets seem to be a perfectly suitable catalyst for change. The UK is still miles behind the rest of Europe, data from IDate suggest fibre penetration in the UK is only 1.3% compared to 44% in Spain, but there does seem to be progress being made.

Openreach dares to contemplate retiring its copper network

UK fixed-line wholesaler Openreach has launched an industry consultation into the switch to ‘full fibre’, which would involve retiring the legacy copper one.

There’s not a lot of point shelling out for a fibre network covering the whole country if a bunch of people don’t use it. Furthermore the cost of maintaining two parallel networks would be prohibitive, so Openreach seems to be saying full fibre will only happen if everyone is fully committed to it. The purpose of this consultation seems to be to chuck that idea out there and see what the rest of the industry, including the government and Ofcom, has to say about it.

“…we’re consulting with broadband providers to decide how and when we upgrade customers to even faster, more reliable and future-proof, full fibre broadband,” said Katie Milligan, MD for Customer, Commercial and Propositions at Openreach. “We believe this consultation is crucial to that process, and it will support further investment from across the industry. We’re really ambitious about upgrading the UK to the fastest, most reliable broadband there is.”

These are the three main areas Openreach wants feedback from UK CSPs on:

  1. How it builds the new network
  2. How the industry should migrate customers smoothly onto the new network
  3. How Openreach should eventually retire the existing copper network

Getting buy-in from the CSPs is vital, of course, because they and their customers are ultimately the ones that will pay for this network. The above points are all essentially about money: how are we going to pay for this network and make everyone use it? On top of those Openreach flagged up a few more specific ‘guiding principles’ that also need to be considered:

  • Building contiguous footprints within its exchange areas to avoid creating new not-spots
  • Working closely with CPs to upgrade every customer in those areas quickly once the new network is built
  • Offering a compelling, simple portfolio of products that supports new retail voice and broadband services
  • Upgrading the large majority of people voluntarily, whilst developing an industry process for late adopters
  • Withdrawing copper-based services progressively
  • Developing a consumer charter with industry and Ofcom that encourages transparent communications to homes and businesses affected, and includes protections for vulnerable customers

In other words those pesky ‘late adopters’ would eventually be given no choice but to upgrade. This is what Openreach had to say about the copper situation: “The process would start with a ‘no move back’ policy for premises connected with FTTP, followed by a ‘stop-sell’ of copper services to new customers, and ultimately a withdrawal in full.”

It seems a bit authoritarian, but if the economics of maintaining the copper network don’t add up then it’s hard to what alternatives there are. The danger of forcing consumers to take a service is that CSPs could take that opportunity to over-charge, so Ofcom will want to keep an eye on that side of things. The government, as ever, will ride on the coat-tails of the process in its never-ending search for cheap political capital.

“We’re building a Britain that’s fit for the future, and our plans for a national full fibre broadband network underpin our modern industrial strategy,”  said Minister for Digital Margot James. “Upgrading to gigabit capable connections will benefit homes and businesses all across the UK. I welcome Openreach’s consultation on how to make this process as simple and efficient as possible whilst ensuring a competitive market is in place for all consumers and infrastructure providers.”

Openreach also recently announced Salisbury is going to become the UK’s first place to get FTTP across an entire town, which will be complete in April 2020. It seems to be setting this up as an exemplar of how great everything can be if we all cooperate on this stuff and reap the consequent connectivity rewards. This consultation will be open until 3 May, after which Openreach will let us know how it went.