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News | Published August 05 2019

UK telecoms industry challenges Johnson’s broadband pledge

Prime minister Boris Johnson’s desire for full-fibre broadband “for all” by the year 2025 has come under scrutiny from leaders in the UK telecoms industry.

An open letter from a number of broadband companies says that his target is reachable but warned that four major issues holding back its implementation must be dealt with “within 12 months” if it is to be delivered.

However, the letter also advises that one such barrier would not be resolvable within the next year.

The chair of the Internet Services Providers Association, the interim chief executive of the Federation of Communication Services and the chief executive of the Independent Networks Co-operative Association have all signed the letter.

Members of these organisations include telecoms giants such as BT, Openreach, Sky, Gigaclear, CityFibre, Hyperoptic, Virgin Media, Google and Vodafone.

The four major challenges included in the letter are as follows:

- Planning reform: Implementing this would prevent the present need for telecoms providers to receive "wayleave agreement" permission from property owners to access land to install cables. The idea is that landlords would be forced into granting access to properties if a tenant has requested a full-fibre connection be installed on-site.

- Fibre tax: the fibre infrastructure currently has business rates applied as is the case with commercial properties, which industry leaders argue acts as a disincentive to new investment.

- New builds: the government has consulted on whether new-builds should incorporate gigabit-capable internet connections but the response is yet to go to publication. In the meantime, many new homes are being built with no provision for fibre-optic broadband.

- Skills shortages: a large number of engineers will be needed to complete major works on the UK's broadband infrastructure. BT and Virgin Media have previously warned that Brexit could result in labour shortages. The industry would like more investment into training and have the freedom to continue to "compete for global talent”.

The letter went on to warn that full fibre-optic broadband nationwide is “not a can that can be kicked down the road” and that work must “start now” on delivering it.

“100 per cent fibre coverage requires 100 per cent commitment from government”, the letter concludes.

The company responsible for the upkeep of the UK's digital network infrastructure, Openreach, warns in the letter that upgrading the whole UK network would be a “major civil engineering challenge” and called on the government to encourage investment into the project.

Fiona Vanier of consultancy firm CCS Insight believes tax relief for companies installing fibre-optic broadband could help address one of the four major barriers, but warned that any legislation on the issue would be “difficult to draw up”, exacerbated by Johnson’s weak majority in parliament.

Vanier said: "That is going to require a very carefully worded piece of legislation that takes into account business owners, property owners, landowners, as well as the telecommunications and service providers.

"There's just recently been a change in Prime Minister, the majority is very slim, and they have things to be getting on with the Brexit deadline at the end of October.”

Johnson first raised his wish to provide a universal introduction of fibre-optic broadband to UK properties during the Conservative leadership campaign in an article he wrote for the Telegraph.

Addressing the letter and its contents, a spokesperson for the Department for Digital, Culture Media & Sport said: "We are pleased industry shares our ambition to turbo-charge the economy by delivering world-class, gigabit-capable broadband across the country as soon as possible.

"The government is committed to creating the right opportunities for investment and speeding up the rollout of the required digital infrastructure.”

The spokesperson said that a more detailed response relating to the four challenges  would be delivered further down the line.

Notably, the UK is lagging behind several of its European neighbours in fibre-optic provision. According to a recent study, in Latvia, Lithuania and Spain, roughly half of all homes have access to FTTP connections according to a study.

However, some industry leaders have suggested that the government could turn to more economical solutions to catch up with competitors.

O2 chief executive Mark Evans has suggested that 5G could be a reliable alternative for those living in more sparsely populated areas of the UK.

Speaking to the BBC, Evans said: "At what level does it become uneconomic to provide fibre versus mobile?

"I would suggest that isn't at 100 per cent fibre connectivity because, for example, the Scottish farmer that lives remotely, we can reach that person, give them the bandwidth, give them a 5G experience, it's much cheaper than digging the fibre connectivity to that home. That's just nonsensical.

"So I applaud him on his desire to improve fibre connectivity in the UK - but I do think there's a level that he needs to weigh up as to which type of technology meets the need."

Virgin Media also said in July that in the near future it would have the capacity to deliver gigabit download speeds using copper-based coaxial cables, removing the need for major works on streets to install new fibre for enhanced connection.


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Authored by

Scott Challinor
Business Editor
@theparlreview
August 05 2019

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