FTIR report fires shot across Openreach bows, says regulatory changes needed for full fibre rollout
Full fibre rollout across the UK (estimated to cost £30 billion) would take 20 years and still only reach 75 percent of the UK’s population if current progress continues.
That’s according to the government’s Future Telecoms Infrastructure Review (FTIR) report, which was published this morning.
The report, published by the Department of Digital, Culture, Media and Sport found that currently just four percent of the country is connected to fibre-to-the-premises (FTTP) compared with South Korea (99 percent) and Japan (97 percent).
As a result FTIR aims for a sweeping regulatory shakeup, pitching policy proposals including making FTTP mandatory for all new-build housing developments, with the aim of securing full coverage across the entire UK by 2033.
Policy Obstacles, Not Capital Shortage to Blame
The report notes: “The availability of capital is not the key constraint – but we do need the right conditions to attract investment. The current regulatory and policy environment has worked well to date in stimulating retail competition based on existing networks. However, changes will be necessary in the regulatory and policy environment, to incentivise the large-scale deployment of new networks in rural and
urban areas across the UK.”
Full Fibre: FTIR’s Recommendations
The FTIR makes several key recommendations to accelerate the pace of full fibre broadband access.
These range from new legislation making full fibre connections mandatory for new build developments, to an industry-led switchover from copper to full fibre.
Crucially, the report emphasises a regulatory willingness to force infrastructure providers to share their physical infrastructure is key to bringing down costs – with Openreach particularly highlighted.
A Shot Across Openreach’s Bows
The report said: “The largest expense incurred when deploying a network is typically the costs of civil works in laying passive infrastructure like ducts and poles. There are limited benefits from the duplication of passive infrastructure and sharing such assets will reduce both costs and disruption, while preserving the ability of networks to compete.”
It’s authors added: “Ofcom’s enhanced access regulations requiring Openreach to share its vast network of ducts and poles with rival operators has the potential to significantly reduce deployment costs. Duct and Pole Access (DPA) could transform the business case for investing in ompeting full fibre networks. If the evidence shows that this remedy is not being implemented properly by Openreach, all options should be considered to ensure compliance.”
An Openreach spokesman told COmputer Business Review: “We’re encouraged by the Government’s plan to promote competition, tackle red tape and bust the barriers to investment. As the national provider, we’re ambitious and want to build full fibre broadband to 10 million premises and beyond – so it’s vital that this becomes an attractive investment without creating digital inequality or a lack of choice for consumers and businesses across the country. As the Government acknowledges, the economics of building digital infrastructure remain challenging for everyone, and we believe a review of the current business rates regime is necessary to stimulate the whole sector.”
They added: “We’re already building full fibre to around 10,000 homes and businesses every week, and by 2020 we’ll have reached 3 million. We have a huge, world class engineering team and wherever we build, we’ll deliver the best quality network with the highest levels of service and built-in competition and choice. We’re determined to be the dependable partner for Government, the industry and our 600 wholesale customers as we work to bolster Britain’s position as a global digital leader.”
It’s also expected that nationwide availability for full-fibre is likely to require £3-5 billion funding to support commercial investment in the final 10 percent of those areas. In those areas, the Government is pursuing an “outside-in” approach, supporting investment in the hard-to-reach areas alongside networks being served in commercially viable areas.
Sharon White, Ofcom Chief Executive added: “We welcome the Government’s review, and share its ambition for full-fibre and 5G networks to be rolled out right across the UK.
“The Government and Ofcom are working together, and with industry, to help ensure people and businesses get the broadband and mobile they need for the 21st century.”