US security concerns rubbished by industry and academic feedback

If you thought the UK’s Supply Chain Review was coming to an end, think again as policy makers have been given more food for thought as part of the 5G infrastructure and national security inquiry.

Entitled ‘Ensuring access to ‘safe’ technology’, Parliament’s Joint Committee on the National Security Strategy has opened itself up to public comment. Although it comes as little surprise, the feedback is relatively consistent; let the industry work with Huawei and take a risk-based approach to managing infrastructure and networks.

For those looking across the Atlantic, there might be some hurt feelings. Business and academics from across the UK have largely panned concerns, albeit in very polite wording, suggesting that while there are security standards and regulations to ponder, the US rhetoric is largely not supported by evidence and undermined by its own actions.

Submitted to the inquiry mid-way through last week, the team at Oxford Information Labs makes a very valid point regarding Huawei’s entry onto the Entity List:

“The ban was immediately suspended for 90 days, and that suspension was continued for a further 90 days in August 2019, casting doubt on whether Huawei really did represent an immediate ‘national emergency’ as originally claimed.”

Many might have contemplated this opinion, but few have vocalised it. If Huawei is such a threat to US citizens and business, why has the US Government so easily allowed it to continue to do business within its borders? If the White House propaganda is to be believed, Huawei should be erased from the Land of the Free, though the US Government has continued to validate its presence through the two exemption periods.

There is of course the damage to US businesses to take into account but suspending the enforcement of the ban does undermine the insistence that Huawei is the tip of the Chinese sword.

Another point to consider, which is constantly overlooked, is the depth of evidence to support the wild claims of the White House.

“The US Congress has a long history of making accusations against Huawei, though it has never produced any technical evidence to show that it has undermined the security of its network equipment or that it has impaired the performance of or shutdown networks using its equipment,” said Ewan Sutherland, a telecommunications policy expert from the University of the Witwatersrand.

From a personal perspective, your correspondent feels this is an element of the saga which should be taken very seriously. Due to market consolidation and the intensive R&D demands of 5G, there are already few suppliers for the telcos to consider. If one or two of the major players are to be removed from the supply chain, this is a significant decision to make. Evidence should be at the heart of these actions.

This is an element of the debate which everyone should take into account. Huawei has no material presence in US networks, aside from working with a small number of regionalised players. The US does not have to take an evidence-based approach to banning Huawei, as there is little consequence. Other nations, who have existing relationships with Huawei, must take a much more contemplative approach as there are much more serious implications.

The call for Huawei to be managed as opposed to banned is one which has echoed out of the offices for some time. Vodafone has consistently called for a risk-based approach to procurement, while Three in its evidence to the inquiry has demanded the delay to deployment be minimised. This would appear to be the rational approach, though the UK Government does seem hard-pressed to support it.

This is where the telecommunications industry has backed itself into a corner. In the pursuit of a more cost-efficient supply chain, consolidation has been rife. Alcatel, Lucent, Motorola and Nortel were all victims of the consolidation trends, streamlining the number of suppliers who can offer services to the telcos at scale. Telcos now have to look at Chinese vendors to ensure there is competition.

In an ideal world, the UK or US Government might be able to point to a domestic supplier and suggest more products and services are sourced there. This would allow the Government to have more of a handle on development requirements, and despite the suggestion of a new player emerging, this is unlikely to have any material impact on 5G.

“Perhaps, the United States will push or support the creation of a new manufacturer of RAN, though it would need to be for 6G or 7G, rather than 5G,” said Sutherland.

The likes of Huawei, ZTE, Ericsson and Nokia have been investing in 5G R&D for close to a decade and have already begun 6G investigations. What chance would a new, standalone player have in penetrating this market within the next 10-15 years?

Looking through all the submissions, there seems to be a consensus. There are only three network vendors who can realistically support rapid 5G network deployment at scale, and Huawei happens to be one of them.

Regulators do need to have a much more considered approach to acquisition and mergers in the future, if not for any other reason as to avoid the bureaucratic congestion which we are seeing through this entire Supply Chain Review process.

Another interesting takeaway from the evidence which has been presented, is the desire to remain closely aligned with Europe following Brexit. This should not be considered new either, though perhaps this could build a bridge to repair the damage done by posturing politicians during the Brexit negotiations. Let’s not forget, Europe is the UK’s largest trading partner, and this will not change any time soon; relationships will have to be re-forged following the divorce.

Last week, the European Commission collated all responses from member states into a white paper which said very little which was not already known. 5G presents more of a security threat than generations prior, while state-sponsored attacks are becoming more of a risk. While this might have been seen as busywork, it was a necessary step in the bureaucratic maze to getting something done.

Over the coming months, member states will submit more evidence and recommendations to create what could become a pan-European approach to mitigating risk and rolling out 5G networks. What the submissions are suggesting to the UK Government is that any future proposals on the Isles align as closely as possible to what our European cousins are suggesting. Not only does this provide international consistency, it is a sign of good faith for future trade and political relationships.

Although this is not the end to the protracted evaluation of Huawei and the role of Chinese vendors in the UK network infrastructure segment, it does paint a very strong case for inclusion.

Europe has proven to be a key battle ground in the increasingly fraught conflict between the US and China, and few companies are more exposed to the risk as Huawei. This is a vendor which captures billions in profit in its domestic market, as well as across Asia, though Europe contains a significant number of very prominent customers. However, the trends do seem to be heading the right direction.

Germany has recently said it would not legislate Huawei out of the country, Italy signed a Belt and Road Initiative deal with China in March 2019, Belgium has conducted its own review without consequence to the vendor, while France and the Czech Republic have given warnings but not definitive action. While it is still anyone’s best guess, the UK looks like it is heading towards a risk-based position, potentially enforcing a multi-vendor approach to procurement.

Of course, while logic and behaviour suggest this is the most likely outcome, there is a lot which can go wrong. The UK will have to balance up the impact on existing and potential relationships, especially its standing in the valuable Five Eyes intelligence community.

At some point in the future, the Government is going to have to make a decision. The prolonged review of the supply chain does not sit beside political ambitions for a rapid rollout of 5G or the accelerated timeline for a full-fibre nation. The longer this review takes, the less likely it is the UK will be a major player in the digital economy.

India promises spectrum reform as telcos bemoan status quo

The Indian Government has promised it will reform the pricing structures of spectrum auctions over the coming months as telcos cast their eyes to the 5G horizon.

Speaking at the India Mobile Congress, Telecom Minister Ravi Shanker Prasad suggested a new wave of spectrum auctions would take place over the next 12 months, and much to the happiness of the telcos, the team will work to make it cheaper.

While numerous nations around the world have been pushing forward with their own spectrum auctions to ready economies for the 5G euphoria, India is one where progress has been incredibly sluggish. There have been attempts to get the ball rolling, however industry has pushed back due to the high base prices which were set by the Government.

In 2016, 2354.55 MHz of spectrum ranging across the 7 bands was auctioned off, with many of the telcos applying to participate. Unfortunately, the end result was only 40% of the licences being allocated, with price seemingly being the reason.

In 2017, another consultation process was launched by the Telecom Regulatory Authority of India (TRAI), with the aim being to push out 5G spectrum and the unallocated assets from the 2016 edition. No further action was taken following the end of the consultation, with industry requesting the auction be pushed back.

The comments from Prasad might well be a watershed moment in the stalemate. It seems the Government was the first to twitch on the pricing conundrum.

Speaking at the same event, Vodafone Idea Chairman Kumar Mangalam Birla said, “while we stand committed to support the growth of the industry, we seek enabling regulatory environment to ensure that necessary investments are made.”

Reliance Jio board member Mahendra Nahata also suggested pricing for 5G spectrum should “critically looked at”. The general feeling appears to be the Government is not looking at the big picture, targeting revenues derived from spectrum sales in the short-term, instead of looking long-term at national economic growth which can be achieved through the continued progress being made in the connectivity world.

This is of course an equation which is difficult to balance. The telcos will always want to make sure they are paying as little as possible for spectrum licences and will promise the difference will be invested in network deployment. This is a reasonable assumption, though there is no way to prove charging less for spectrum licences would result in increased network deployment. The telco might well have spent the same but is trying to reduce expenditure.

Industry is of course perfectly entitled to push back against what it would perceive as pricing structures which are too expensive, but this will have a negative impact on the business and the nation. Pricing of spectrum is very difficult balance, as there is no rule which can be applied everywhere.

India is a very unique market, as while it has the second largest population of consumers worldwide, it does also have low ARPU and significant expenditure to make on network deployment.

While telcos moaning about the price of spectrum is nothing new to consider, a slight concession from the Indian Government is certainly a step in the right direction. There will be months of negotiation and research to understand what a suitable pricing structure actually is, but this is a much more promising sign that spectrum auctions in the near future will be successful.

Government deals with difficult landlords

The UK Government has unveiled new rules which will allow telcos to speed-up the process of dealing with non-responsive landlords.

One of the challenges being faced by telcos in upgrading broadband across the country is gaining access to the right properties and land. Multi-dwelling units seem to be the biggest challenge, as some property owners are less than helpful when granting access. The new rules will speed up the process of seeking access through the courts for telcos.

“We’re pushing ahead with delivering the digital infrastructure that will underpin the UK’s future growth and boost our productivity,” said Digital Minister Nicky Morgan.

“We’ve just announced £5 billion so that people in rural communities will get gigabit speed internet at the same time as everyone else. And we’re now making sure people living in blocks of flats and apartments are not left behind either and can reap the huge benefits of the fastest and most resilient internet connections.”

Telcos claim that 40% of requests to enter a property are left unanswered by the landlords, and while we suspect this number has been inflated for the purpose of the lobbyists, access to multi-dwelling units is a persistent complaint.

“This new law is something Virgin Media has long called for – it breaks through a major broadband barrier as we invest to bring gigabit speeds to our entire, ever-growing network,” said Lutz Schüler, CEO of Virgin Media. “Giving broadband builders clear and efficient access rights will mean the many forgotten flats across the country can get the next-eneration connectivity they deserve.”

Under the current rules, telcos can petition the courts for access to properties should the landlord be unresponsive, though this process can take up-to six months and cost as much as £14,000. The new rules offer a streamlined service, reducing the action time to 6-7 weeks, and the cost to £300 per case.

Although this is only addressing a single challenge in the digital economy, it is one of the issues which has been highlighted in recent months by the telcos. Should these companies have any chance of meeting the Government’s exceptionally aggressive full-fibre deployment objectives, there are a lot of regulatory barriers which will have been be broken down. This is one, demonstrating the Government is perhaps listening to the appeals of industry.

UK, US and Australia demand security delay from Facebook

Politicians from the UK, the US and Australia have penned an open letter to Facebook CEO Mark Zuckerberg requesting the team delay end-to-end encryption plans.

Signed by UK Secretary of State Priti Patel, US Attorney General William Barr, Acting-Secretary of Homeland Security Kevin McAleenan, and Australian Minister for Home Affairs Peter Dutton, the letter requests that before any encryption technologies are applied to messaging services Facebook includes a means for enforcement agencies to access the content transmitted across the platforms.

Once again, politicians are defying logic by requesting the creation of a backdoor to by-pass the security and privacy features which are being implemented on messaging platforms and services.

“We are committed to working with you to focus on reasonable proposals that will allow Facebook and our governments to protect your users and the public, while protecting their privacy,” the letter states. “Our technical experts are confident that we can do so while defending cyber security and supporting technological innovation.”

It is as if the politicians do not live in the real world. We understand governments have a duty to protect society, and part of this will include monitoring the communications and activities of nefarious individuals, but this is not the right way to go about doing it.

Using the argument of security to undermine security and make citizens less secure is a preposterous idea, almost laughable. The ‘technical experts’ might be confident a backdoor can be built, but how do you protect it? This letter is requesting the construction of a vulnerability into security features, and once a vulnerability is there, it is only a matter of time before it is exposed by the suspect individuals in the rotting corners of society.

What is being suggested here is similar to building a high-security facility in the real world, with 15-foot, electrified walls, guards and watch-dogs, helicopters patrolling overhead, but then asking to leave the backdoor unlocked. It doesn’t matter how good defences are, eventually someone will find their way to the backdoor, open it and then let all his/her friends know how it was done. Chaos would eventually find a way.

This is of course a theoretical situation, the hackers might never find a way to or through the backdoor, but why tempt fate? No-one leaves their home believing they might be burgled that night, but they lock the door in any case. Why create a situation where the prospect of chaos is a possibility, irrelevant as to how faint? This seems like nothing more than simple logic.

As mentioned before, police forces and intelligence agencies are being tasked with keeping society safe. This is a very difficult job, especially with the progress of technology. Facebook, and others in the technology industry, should assist wherever possible (and legal), though this is not the right way to go about the situation.

This does put Facebook in a difficult position. The company is currently attempting to repair the damage to its reputation, as well as re-gain trust from both governments and wider society. However, it is increasingly looking like an impossible situation to satisfy both parties.

In March, Facebook CEO Mark Zuckerberg outlined a new focus for the company; it would hold the concept of privacy dear, and all new services will be built with privacy at the forefront of demands. Thanks to the Cambridge Analytica scandal, Facebook’s reputation as a guardian of personal information has been severely damaged, thus this new approach is critical to regaining credibility in the eyes of its users.

However, end-to-end encryption is a key element of this privacy strategy. Facebook cannot fulfil its promise to the user and satisfy the demands being laid out in this letter. If it was to build in a vulnerability, it could not tell the user in all honesty it has done everything possible to ensure security and privacy.

As the letter states, Facebook is doing more to clean-up its platform.

“In 2018, Facebook made 16.8 million reports to the US National Center for Missing & Exploited Children (NCMEC) – more than 90% of the 18.4 million total reports that year,” the letter states. “As well as child abuse imagery, these referrals include more than 8,000 reports related to attempts by offenders to meet children online and groom or entice them into sharing indecent imagery or meeting in real life.”

This is the situation which Facebook is in. It is never going to be able to remove all the hideous conversations and activity on its platform, but governments will demand it does. Something will always slip through the net, and the sharp stick of the law will be there to punish the company. Facebook will never be able to do enough to satisfy the demands of governments, and therefore will always be a defensive position.

However, you should not be distracted by the rhetoric which is being put forward in this letter. Yes, there are some horrendous activities which occur on the platform. Yes, Facebook should, and probably could, do more to assist police forces and intelligence services. Yes, the digital economy has largely shirked responsibility in the years leading to today. But no, building vulnerabilities in the system is not the right way forward.

These politicians are saying the right things to gain public support. These actions are in the pursuit of catching child molesters and terrorists; who wouldn’t want to help? But you have to look at the collateral damage. Users would be left open to identify theft, fraud and blackmail. These messaging platforms are used to have private conversations, exchange bank account details and discuss holiday plans. The number of criminals which could be caught is nothing compared to the billions who would be exposed to hackers on the web.

The idea which is presented here does have good intentions, but it pays no consideration to the collateral damage. The negatives of introducing a backdoor vastly outweigh the positives.

Quite frankly, we are still surprised to be having this conversation. Undermining security is no way to improve security. Governments need to understand this is not a viable option.

US warns Italy over the Huawei job

US Secretary of State Mike Pompeo is back in Europe and this time he is attempting to scare the Italians into line.

It has been a quiet few months for the White House enforcer, though Pompeo is back in the European ring throwing punches towards Italy and his old foe, Huawei. At a press conference in Rome, the same line has been delivered to the Italian press; if Italy works with Huawei, it does not bode well for its relationship with the US.

“And so to the extent that an Italian company makes a decision to invest in or provide equipment that has a network that our national security teams – our intelligence teams, our Department of Defence – conclude isn’t a trusted network, where we have risk to our information that we can’t figure our way through, we’ll have to make some very difficult decisions,” Pompeo said.

“We want to be a partner with Italy in all of these things, but it is not the case that we will sacrifice America’s national security to put our information in a place where there’s risk that adversaries or the Chinese Communist Party might have access to that.”

Although this is the most relevant point to the telecommunications industry, it should also be noted there is existing tension between the US and Italy.

The US is unhappy over loans and subsidies which have been granted to EU aerospace company Airbus. Thanks to this assistance, Airbus is now able to challenge US rival Boeing on the global stage, though the means by which success has been realised has irritated the White House. Tariffs have been suggested on certain European food exports such as whiskies from Ireland and Scotland, as well as wine and cheese from Italy.

While there have been protests from officials against the tariffs, the World Trade Organization (WTO) has said the US is free to pursue the charges if it chooses to. This has led to increased tension between the US and various European nations, including Italy. During his four-day tour of the country, Italian farmers exchanged stern words with Pompeo to demonstrate their frustration.

It might not be directly relevant to the Huawei saga, but it is another chapter in the story which indicates the US and Italian Governments are not on the friendliest of terms.

In terms of the telco and technology space, Italy has not made any commitments to ban Huawei to date, though Pompeo seems to think it is necessary to edge the Italian Government along. It is a message which the statesman has delivered on several occasions to European counterparts; if you work with Huawei, we might not work with you.

What is odd, however, is that the Italian telecommunications scene hasn’t been the most profitable for Huawei to date. Vodafone and Telecom Italia both rely on Ericsson as their main equipment provider, while Iliad recently announced it was continuing its relationship with Nokia. Wind Tre’s main supplier Chinese state-owned ZTE, which might irritate a few in the US, though Huawei, the victim of much of the White House’s aggression, isn’t a major player here.

More than anything else, this seems to be more symbolic from Pompeo. There might be other distractions in the world of politics, but it is always useful to re-iterate it point about Huawei.

This threat from the White House is not necessarily new however. The same has been said to the UK, largely ignored by the Germans, irritated Hungary and proved somewhat successful in Poland. Only the Poles have taken a firm stance against Huawei, aligning themselves with the US by signing an agreement on 5G security which effectively bars Chinese vendors from supplying equipment for Polish 5G networks.

Looking at the economics side of the argument, the US accounts for 9.3% of all exports, making it the third-largest destination behind Germany and France. Wine accounts for 4.1% ($1.83 billion) of the exports to the US, pasta 0.69% ($310 million) and cheese 0.71% ($317 million). The US is a very important trade partner of the Italian economy, and the tariffs mentioned above will certainly have an impact.

While banning Huawei from the Italian market would not necessarily have a material impact, it would be a symbolic gesture. This is another example of the US attempting to harness support in its on-going battle with the Chinese, though the Pompeo threat causes any reaction from the Italian Government remains to be seen.

Tories promise another £5 billion to fuel fibre and 5G drive

Speaking at the Conservative Party Conference in Manchester, Chancellor of the Exchequer Sajid Javid has suggested an additional £5 billion will be made available for connectivity upgrades.

Although it has been tricky to confirm any of the details, it has been reported the Tories will search for an additional £5 billion to fulfil the fanciful promises Prime Minister Boris Johnson has been making in the connectivity domain.

Speaking to the press office at the Department of Digital, Culture, Media and Sport, we were told that as this is a political matter they are not involved. Over at the Conservative Party press office, the team said they were not in a position to make any official confirmation just yet (at the time of writing).

Although this is part of a wider infrastructure message, including other areas such as road schemes and bus services, Javid has suggested the £5 billion would be used to ensure a digital divide is not created as roll-out of full-fibre, 5G and other gigabit capable networks steps-up a level.

“We want to make sure that we’re upgrading across the country, much of that can be done by the market which is a great thing,” Javid said during a Twitter message.

“But what I’m specifically focusing on today is the hardest parts of the country, some of the more rural areas and trying to make sure that no-one in this country is left out. We want to level up and make sure everyone gets the benefit of new, modern infrastructure.”

This is a common message from both the Government and the connectivity providers. There has been notable work over the last couple of years to ensure there is a fair and reasonable deployment of future-proof infrastructure. Although the telcos will be more drawn to investments in the more densely populated areas, this approach to drive ROI will not sit easily with the Government.

The Universal Service Obligation (USO) has been designed to ensure everyone across the UK has a clear, enforceable right to request high speed broadband, while the Local Full Fibre Networks (LFFN) programme offers £740 million from the National Productivity Investment Fund to entice interest in the rural communities from the private market.

Looking at the mobile side, with the release and auction of new spectrum, coverage obligations are placed on the telcos. Following the Connected Nations 2018 report, the Government has committed to extend 4G geographic mobile network coverage to 95% of the UK by 2022. As part of the 700 MHz spectrum allocation, industry has to commit to at least 500 new mobile mast stations in rural areas to improve coverage.

Details are relatively thin for the moment, though this will be taken as a minor positive by the telcos.

In promising full-fibre coverage by 2025, PM Johnson was mocked by industry. To achieve such a feat, BT has suggested the industry would have to find an additional £30 billion in CAPEX, and industry would not be keen to fund this alone. £5 billion from Javid is a start, though considering this is to be spread across both fixed and mobile, there will have to be a few more of these announcements in the pipeline.

Norway says yes to Huawei

The Norwegian Government has said it will not ban Huawei from providing network infrastructure equipment or services to fuel the drive towards 5G.

According to Reuters, Cabinet Minister Nikolai Astrup, the man who leads digital efforts across the government, has confirmed Huawei is free to operate in the country. While it is not the largest market for telco vendors, it is another positive sign that not everyone around the world will side with the US.

“We have a good dialogue with the companies on security, and then it is up to the companies themselves to choose suppliers,” said Astrup. “We haven’t got any bans against any suppliers in Norway.”

For Huawei executives, there will be a sigh of relief. Norway was one of the countries which was considering a ban on the grounds of national security, though this now appears to be a process designated to the past. It also demonstrates decisive action from a government; others around the world should take note.

Although Norwegian telcos fall into the fast-follower category for 5G deployment, they now have the advantage of certainty. Other countries, where services are already launched, do not have this confidence as decisions are still currently being made. The UK is a prime example of this.

The Supply Chain Review, on which Huawei’s hopes are pinned, is still under consideration. EE, Vodafone and Three might have already launched 5G services, though they are currently sitting in a state of purgatory. Without absolute confirmation of Huawei’s role in the UK’s digital infrastructure future, aggressive deployment plans are tricky. This is most apparent for Three and Vodafone, where Huawei is pencilled in to play a very significant role.

This dilemma is not present in Norway anymore. Telenor, Norway’s largest telco, plans to launch commercial 5G services in 2020 and can drive towards full-scale network deployment without any limitations on vendor selection from the government. We do not expect any single vendor will be a single-supplier, though it does have increased choice of suppliers compared to other nations.

Elsewhere in the Norwegian telco space, Telia and Ice will also be prepping themselves following the country’s first 5G spectrum auction in June. At the end of the auction, Telenor and Telia each walked away with two 10 MHz blocks 700 MHz spectrum, while Ice collected two 10 MHz blocks in 700 MHz and two 15 MHz lots in the 2100 MHz band. Further auctions are planning over the next few years, with the valuable 3.4-3.8 MHz and 26 GHz bands up for bid next year.

Looking at the relationships which are currently in place, Telenor and Telia have a partnership with Huawei, while Ice has elected to side with Scandinavian neighbour Nokia. Most recently, Telenor has been working with Huawei to trial 5G in the 26 GHz spectrum band, while Telia’s Swedish parent company signed a 5G MOU with Huawei in 2016. Both of the companies have Huawei equipment present in the 4G networks.

Ice is the smallest telco in Norway, it doesn’t have nation-wide coverage just yet, and has elected to work with Nokia. Nokia appears to be providing an end-to-end solution for the challenger telco, which is claiming to have already deployed 1000 5G-ready base stations in its network. Ice is an interesting telco to keep an eye-on, as while it is driving towards 5G connectivity, it still has a significant amount to invest to gain nation-wide coverage for its 4G network, which currently stands at 75% geographical coverage. This might not sound too bad, though when you consider the environmental challenges Norway’s landscape presents, it will be very difficult to improve this footprint quickly.

Another interesting element to consider here will be the impact this has on the relationship between the US and Norway. The US is continuing to pressure partners to place a ban on Huawei, and despite making progress in Poland, more countries are choosing to ignore the demands of the White House.

Looking at the Norwegian export statistics, you can see why the US does not have the same influence as it does with other states. Norway is the 36th largest export economy in the world and the 22nd most complex economy according to the Economic Complexity Index (ECI). Exports stood at $106 billion at the end of 2017, with crude petroleum and petroleum gas topping the list.

In terms of destinations, Europe accounted for 80% of all exports from the country, the UK led the way with 20%, while the US accounted for 4.7%. This is still a substantial number, though the US cannot force its will on the politicians in the same way.

Although the continued conflict between the US and China, in which Huawei is somewhat of a proxy for collateral damage, is causing discomfort for the vendor, it could be a lot worse. Worse case scenarios were drawn-up when the tension got to breaking point, though with numerous governments choosing to ignore the severity claims from the US, Huawei remains in a healthy(ish) position.

BT said to plan copper broadband network switch off by 2027

A new report claims UK operator group BT is planning to complete the full conversion of its fixed line network from copper to fibre within eight years.

The gossip comes courtesy of Sky News, which reckons BT CEO Philip Jansen is in ‘secret talks’ with the government regarding the timetable for switching off the copper broadband network. What makes these talks more secret than any others between CEOs and politicians isn’t stated. And, of course, the very act of publishing the story also means they are definitely not secret now anyway.

Apparently Jansen is at the head of an entire covert cabal, including regulators and other industry stakeholders, intent on dictating the UKs broadband agenda for years to come. A kind of telecoms Illuminati, the report would have us believe. The initiative seems to have been catalysed by Prime Minister Boris Johnson’s stated aim of achieving full UK fibre coverage by 2025.

We asked BT for a comment on the report and got the following: “As we made clear at the time of our last financial results there needs to be a determined acceleration towards a pro-investment policy and regulatory regime, so BT is keen to see the industry work together with government on the big challenges – such as digital switchover and rural coverage – that we all want to see addressed.”

That seems to be a circuitous way of saying “we don’t comment on rumour and speculation,” but fair enough. Speaking to other industry figures we get the impression that Sky’s source (assuming they didn’t just make it up) probably leaked in order to put pressure on the government and regulators to create the environment to make this broadband utopia possible.

Meanwhile Greg Mesch, CEO of CityFibre, opined the following: “In light of our funded and mobilised Gigabit City programme to deploy wholesale full fibre infrastructure to at least five million homes, Ofcom’s exclusive focus on BT Openreach as the vehicle for migration from copper to fibre is wrong. Retiring the copper network needs to be managed in a way that promotes competition, benefiting every builder of fibre networks, rather than simply reinforcing BT Openreach’s existing market dominance. Consumers should have the power to switch to any full fibre network. CityFibre stands ready to play its part in transferring the nation’s homes and businesses onto a new generation of fibre networks.”

BT has consistently stated that it will only hit these kinds of targets if the right regulatory, public investment and industry cooperation environment is created. By contributing to a public expectation of full fibre by 2027, maybe BT hopes to put the ball in the government and Ofcom’s court. BT can then say it’s doing everything it can to make this happen, but is hamstrung by an unhelpful public sector.

UK Government does not understand digital divide – committee report

A UK parliamentary committee has unveiled a report that suggests while rural connectivity is improving, it is still not keeping pace with the urban environments.

The report from the Environment, Food and Rural Affairs Committee has suggested the digital divide is persistent. Steps forward have been made though the committee does not believe the Government has fully grasped the extent of the problem, the scale of the challenge, or the wider cost of poor connectivity for the rural economy.

“Despite improvements in coverage since our predecessor’s Report, our inquiry has shown that poor broadband and mobile data services continue to marginalise rural communities, particularly those living in hard to reach areas,” said Neil Parish, Chair of the Environment, Food and Rural Affairs Committee.

“Digital connectivity is now regarded by many as an essential utility, with many in rural areas struggling to live a modern lifestyle without it. There continues to be a lot of frustration felt by those living or working in rural areas– and rightly so.”

While the committee has conceded positive steps have been made by the Government is recognising the challenge, Parish does not feel it fully grasps the depth and breadth of the challenge.

“However, the Committee is not confident that the Government has fully grasped the scale of the challenge currently faced and is sceptical as to whether the Government will meet these ambitious new targets without considerable and potentially controversial reforms,” Parish said.

The Government has of course set very ambitious targets to close the digital divide, though it does appear the action plan to meet these targets has not been set in place. If the gains are only being dwarfed by progress in the cities, is this is a genuine solution?

Although it might sound like a first-world problem, the idea of connectivity should no longer be seen as a luxury; it is a fundamental part of the UK’s society.

This is the attitude some will take. You can’t get fast enough broadband, so outside and kick a ball instead of watching Netflix. However, if you consider many banks are now taking a digital-first approach, closing smaller branches in the countryside, connectivity becomes critical. At risk patients no-longer have to be limited to a ward if they can be effectively monitored at home. Agriculture can be revolutionised with technology also. There are certainly more benefits than simply removing buffering.

Another interesting element to this argument, aside from empowering businesses outside the major towns and cities, is the impact on well-being.

This is a very important aspect on improved connectivity and an element of the evolution of many forward-looking businesses. Trends are moving towards a flexible-working relationship between the employee and employer, with more companies being open to work-from-home environments. It improves the happiness of the employee, potentially increasing retention, and also allows the company to access new talent.

However, it does depend on consistent, reliable connectivity throughout the country.

Interesting enough, a sluggish approach to the broadband challenge could also have an impact on the fast-growing mobile economy, bolstered by the emergence of 5G.

“With 5G on its way, it is also crucial to ensure the background infrastructure (the fibre highway) is in place, using techniques such as fibre cabling directly to the outdoor antennas, combining fibre with power to the huge number of new ‘small cells” that will be required and leveraging existing fibre-to-the-home (FTTH) construction to add in extra 5G connection points along the way,” said Phil Sorsky, VP of the international business at CommScope.

The digital divide might not be as apparent in the UK as it is elsewhere, though it is still a persistent problem for British citizens. BoJo’s target of full-fibre coverage by 2025 might sound good, however it does appear there is a lack of thinking behind the execution of the strategy.

O2 starts making progress in the enterprise services world

O2 might be an ‘also ran’ in the enterprise services world to date, but in being named a supplier on the Crown Commercial Service’s (CCS) new Network Services 2 framework, it is taking a step in the right direction.

As the Government agency tasked with improving government commercial and procurement activity, gaining recognition from the CCS is a notable win for O2. The Network Services 2 framework is effectively the list of suppliers public sector bodies and organizations can work with for telco services such as networks, voice and data provision, internet access and wifi.

“We know that making services easy to procure is a major priority for our public sector customers – so the news that we have been named as a supplier on the new Network Services 2 framework is a huge milestone for all of us at O2,” said Matthew Spencer, Head of Public Sector Sales at O2. “It means we can offer our entire product range of ICT services to public sector and non-profit organisations.

“Today’s announcement opens the door to all sorts of new projects and better integration for customers. As technology evolves, there is enormous potential for improved connectivity, productivity and savings across the public sector – and O2 is here to work with organisations as a digital partner, helping them reach their connectivity goals, faster.”

Originally formed in 1991 under a different name, the CCS is part of the Cabinet Office and negotiates preferred supplier lists for Government departments, agencies and non-profits. It you aren’t on the list, you will find it almost impossible to do business in the public sector.

The ‘Frameworks’ are effectively pre-negotiated template contracts for public sector organizations to use when engaging with potential suppliers for a variety of different services. In this case its telecommunications, but it could be anything from office supplies to payroll management software.

Within each of the frameworks, there are designated ‘Lots’. O2 has been named as a supplier for Lots 1-4 and 6-8, allowing it to offer services such as data access; local connectivity, traditional telephony, inbound telephony, mobile voice and data, paging and alerting and video conferencing. The suppliers for Lots 5, 10 and 13 will be decided in the near future, though we were not able to figure out what these Lots cover.

The supplier lists for Lots 9, 11 and 12 have also been drawn up, though O2 does not feature on these. Services covered here are audio conferencing, radio and surveillance.

At O2, this is a big step forward. The CCS has effectively given the telco its seal of approval, allowing the team to expand in the enterprise services arena.

To date, the enterprise market has been largely dominated by Vodafone and EE. O2 has been operating in the private space for some time, though it has been regularly highlighted by the management team as a significant growth area moving forward. This ambition seems to have been compounded with the looming introduction of 5G.

5G offers the telcos new avenues to work with enterprise customers above and beyond the traditional means of connectivity. With digital transformation a buzzword of yesteryear, enterprise organizations and public sector agencies are increasingly looking to technology to enhance operations. There is an opportunity for the telcos to secure a more valued position in the digital ecosystem, as well as the increased profits, if the proposition is right.

Over the last 12-18 months, O2 has been working alongside a number of the FTSE100 firms to trial usecases ahead of the 5G boom. Although details of the activities are relatively thin, the management team has boasted of its success to date.

Entry onto the preferred suppliers list might seem like little more than a box ticking exercise for some, this is a very important step forward from O2. The inclusion in the framework adds validity and credibility to the O2 enterprise services case, offering a much greater opportunity for the team to carve out market share in a, potentially, very profitable segment of the telco industry.