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Who is going to use BT's network?

Rory Cellan-Jones | 11:15 UK time, Monday, 8 February 2010

Last week, the Conservatives came up with a proposal to boost Britain's broadband performance - forcing BT to open up its network of ducts and poles to competitors.

BT logoIn other words, allowing rival firms to lay their own fibre in the tunnels under the streets and along the telegraph poles which currently carry copper (and a little bit of fibre) telephone lines right into millions of customers' homes.

Now BT is saying that it is prepared to do just that - and that it has been talking to the regulator Ofcom about such plans for a while. And this is nothing to do with the Conservative proposal, insists BT's Chief Executive Ian Livingston:

"We told Ofcom last year we're willing to provide open access to our ducts and poles and we are working with them on how to achieve it. Other companies already have access to our exchanges, so we're relaxed about providing them with another form of access as well."

So will this help fill in the big gaps in fast broadband coverage which are threatening to turn Britain into a two-speed society, with rural areas left to get by on slower copper lines? To recap, the situation at present is that BT and Virgin Media are the only two operators with major plans to lay fibre - and it looks as though together they will only reach around 60% of UK households.

Both the Conservatives and the Labour government say their plans will see that coverage extended to 90% of homes by 2017, through a bit of public spending and a tweak in the regulatory environment.

BT expresses scepticism over whether rival firms will be clambering up its rural telegraph poles clutching bundles of fibre: "It's unlikely to be the silver bullet to get fibre to every home," says Mr Livingston. And he then lays out a challenge to his rivals: "BT is taking a considerable degree of commercial risk by rolling out fibre and it will be interesting to see if others are willing to join us."

But this scepticism is nothing new. What we will now find out is how accurate were BT's warnings about the fragility of the commercial case for laying fibre to every corner of the UK at a cost of many billions.

The advantage for BT is that the pressure from broadband campaigners may now switch from BT to the brash young upstart of the broadband world, Carphone Warehouse, whose TalkTalk is by some measures the UK's biggest single supplier. Rural-fibre enthusiasts may soon be calling Carphone boss Charles Dunstone to ask him when TalkTalk's 100mbps service is coming up their lane.

Comments

  • Comment number 1.

    Sorry, on an unrelated note:

    Why is there not a tech section you can add to the BBC homepage, like there is all other BBC News Sections

  • Comment number 2.

    Allowing multiple companies to lay the fiber we cause problems and delays.

    We need to task open reach to lay fiber to cabinat and ensure all properties are within 2km of a green box or exchange.

    OpenReach can then rent the lines at a goverment set rate to all providers.

    Allowing a free for all on fiber laying will mean that 3rd parties will cherry pick and the expensive jobs will be left to BT who will be forced to provide.

  • Comment number 3.

    It's a tricky one this as in reality we only need one fibre network for the nation. Could this be an example, as with the OfGen where the free market economy isn't the way and a touch of government intervention is required.

    Certainly, if Openreach lay a fibre to the cabinet (FTTc) and Fibre to the premise (FTTp) network to cover an ever increasing percentage of the population then all broadband providers can benefit. What I believe we're now seeing from the others such as Carphone Warehouse and Sky is a new technology land grab. Surely the regulator must make these providers share their infrastructure the same as Openreach?

  • Comment number 4.

    BT are, of course, a big provider, but not the only one. The local loop or last (few) kilometer(s) of all of the providers needs to be opened up, including cable operators. This needs to be under the remit of the regulator to ensure that the owner really does open it up to other companies.

    However, a much stronger regulator influence is needed. In Hull and parts of East Yorkshire BT play no part, the local supplier is Kingston Communications who claim their exchanges are open to competitors, yet no company yet supplies alternative broadband. The regulator seems happy with this - I am not, neither are many other KC customers. If simply opening the ducts and poles does not achieve competition and expansion then some process of incentives needs to be introduced, financed by the current owners. Real competitors behave ruthlessly, since the regulator is there in place of competitors, they too must behave ruthlessly in support of the public.

  • Comment number 5.

    Rolling out fibre nationally costs billions. And no one has that kind of money to invest right now. Also, it will never be economic to lay fibre out to rural outposts - unless those in rural areas don't mind paying five to ten times what the rest of us pay for broadband.

    Cheap WiMAX version 2 (wireless broadband) or 4g are the only answers I can see to this conundrum. These should be with us in 2012.

  • Comment number 6.

    Trouble with the opening up of networks like this is that it is likely that much will be wasted on duplication in the areas regarded as profitable (as already happens with BT and Virgin, with BTs fastest services much of the time only covering areas which Virgin also cover). People outside those areas will just be ignored.
    While BT might not be the most popular company around, having a situation where the regulator is forced into making them pick up the large bill for the slightly more difficult areas doesn't seem fair.

  • Comment number 7.

    I don't know about the ducts but it was already possible to use BT poles. As long as you were willing to accept unreasonable restrictions in the contract such as a three month termination notice.

    What about all the ducts that BT say are full but which probably contain a lot of redundant copper and unlit fibre? I suspect there will be a sting in the tail to this announcement. BT's altruism is primarily a myth dreamt up by their marketing and political lobbying departments.

    @James Rigby. Rural FTTH is already working all over the place in the USA. They're not paying over the odds for their service and in general they have population densities lower than here. So where does this idea come from that rural areas are economically untenable, apart from BT that is?

  • Comment number 8.

    Open up the ducts-I think I mentioned this last week ;-)

    1) "It will cost millions to lay fibre"-no it wont, not with the cost of fibre at rock bottom and new techniques like blown fibre.And fibre can now go enormous lenghts with the high powered lasers that are available.Plus do it on a community driven basis.
    2) "wasted on duplication in the areas regarded as profitable"-wrong again-there are loads of small communities that are affluent and would pay to have high-speed broadband, if the main link could be brought in, through those BT ducts.ADSL is like dial up in some of these areas!

    cheers

    cab

  • Comment number 9.

    I think the more interesting question at hand here is whether opening up lines is even financialy viable now with the gradual role out of various types of wireless broadband communications.

    4G alone promises to take the existing 3G service well beyound its current poor coverage and reliability and there are already quite a substantial chunk of users using the 3G service.

    If that isn't entising enough, there are countless new forms of satelite broadband that are currently being trialed that are currently capable of beaming a reliable and constant 50mbps to the home and within the next few years that will rise to 100mbs, with 200-500mbps a likely possibility within the next 5-10 years - speeds comparable to that of the fastest wired connections but with the ability to allow anyone with a dish to get a connection.

    Companies like Virgin and BT must be thinking along these lines: Why spend billions laying fibre when you can spend a quatre of that price launching wireless solutions? If the big boys are thinking that, then it seems a fairly logical assumption that the smaller companies are holding out for the more reliable wireless connections to become a standard rather than blowing money on wire as well.

  • Comment number 10.

    I think opening the ducts up to third parties is not going to create competition, but will create confusion!

    This is basic infrastructure - like roads, power cables, water pipes, railway...it should all be owned by the country and run by the government.

  • Comment number 11.

    Don't see the advantage in this. I work in the gas industry and having third parties doing streetworks is a recipe fir disaster IMO. More roadworks, more third party damage to essential utilities. Not fun...

  • Comment number 12.

    As 10 has already posted, this is national infrastructure.

    The UK needs to have 1 "Fibreco", and access costs are paid to access it.
    If it's the state that owns it, like the road network, then it's probably the way to go, rather than the disaster of the privateers running the Rail Network.

  • Comment number 13.

    This could be the Golden age of service providers. If everyone is running on the same network, the speed won't nessecarily be different among households. This means rather than the ISP offering (The fastest connection), they'll be more inclined to offer (better customer service) Which as we should all know by now, is a major flaw with most ISPs!

  • Comment number 14.

    I figure the purpose of Openreach is to split BT from the shared infrastructure. In the case of fibre itself many other companies in the UK are running their own fibre.. Surely it can only be a bonus in the end if more of the infrastructure is openly avaliable and not controlled by a single party.

  • Comment number 15.

    Duplication is not necessarily a problem; diversity in market and across suppliers is a great help to provide competition, capacity and diversity. A general move to fibre reduces weight, space used in ducts and on poles, and gives protection against lightning and induced power surges. It is the technology of the future, copper only need be used to supply power.

  • Comment number 16.

    "Rural-fibre enthusiasts may soon be calling Carphone boss Charles Dunstone to ask him when TalkTalk's 100mbps service is coming up their lane".

    I live in a Lane. With a terrible TalkTalk service. So When is it coming to my lane then???

  • Comment number 17.

    Well it might come up the lane but will it get into your tower block. Virgin have a termination outside the front door here but only the commercial premises next to it get the service. The University one will pass down the street but don't expect to get it. That is why fibre to cabinet is attractive.

  • Comment number 18.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 19.

    Bit of a no go really this one... Just a short list of problems that I can see happening;

    1. Openreach Ducting already full with their own copper cabling.
    2. Over crowded telegraph poles, I mean they already stand out like a sore thumb as it is.
    3. Confussion as to who owns what cables, i.e. Sky engineers accidently disconnecting AOL's fibre cables.
    4. Service Providers only bothering the put fibre in profitable area's like big towns and city centres and leaving the poor old countryside folk stuck in the "UPTO" 8mb era.

    Really the Openreach and Virgin networks should be bought back into public ownership, that whay we already have about 50/55% of the country on fibre via Virgin and about 0.5% by BT. so all we have to do then is upgrade of the BT Network where their isn't already a fibre network.

    That way, as someone mentioned above Service Providers can concentrate more on Customer Service and just wholesale the lines.

    Also with the Network belonging to the public and not being a plc all profits made can go into investing and upgrading the network instead of paying off shareholders.

  • Comment number 20.

    Biggest issue at this time is the uncertainty factor.

    If a Government change then plans and money spent now may be wasted, or worse in that firms will sit and wait, or even worse for Digital Britain we will have a period of hung parliaments where little direction is given.

    Those providers that have many miles of fibre backbone are the ones to watch, they are in a position to start doing limited fibre roll-outs. Prediction though is that those who already have ADSL2+ will see the benefits first.

    You can say it doesn't matter so long as you have some form of connection, but ask people with dial-up or experience mobile at GPRS speeds and you'll see why even tasks like online shopping are frustrating.

    Largest issue is that there is a small core of people willing to pay perhaps £50 a month to get next gen broadband, but we are spread out over such a wide area no-one is bothering.

  • Comment number 21.

    1 What exactly is the cost per km of fibre from an exchange to a cabinet /premises [FTTC ,FTTH]?
    2 Are there any problems with existing voice channels when fibre is substituted?

  • Comment number 22.

    A single network sounds great in principle, but as we have seen with the rail network and the water and gas supply, having multiple companies using and responsible for, the same system created issues. If someone else damages the network who foots the bill to fix it? if the work they do is not to the same standard as a BT engineer who does the rework? would BT still compensate customers for loss of service if they were not actually a BT customer but a Virgin customer "borrowing" the network?

    The only way this could possibly work is if BT was a nationalised company responsible directly to the government and not to shareholders.

  • Comment number 23.

    At 12:24pm on 08 Feb 2010, Stuart wrote:

    It's a tricky one this as in reality we only need one fibre network for the nation.
    --

    I can't agree with that. In the interests of security, it is always better to physically separate networks.

    One of the best things about the web and the internet is that it allows you to publish or trade from anywhere with a net connection. But with only one line (fibre run) available, you would be sharing the network hardware with unprivileged traffic (the users). And judging by the sorry state of some broadband providers bandwidth offerings, I can't imagine running a semi-successful site with a paltry monthly transfer limit.

    I guess what I'm suggesting is at least 2 flavours, consumer and business, joined through security hardened routing and switches. You could also bond several lines for better speed and capacity, which would be hard to do if the consumer brands fibre run is fully committed.

    And no, I'm not expecting the govt. to pay for it, or BT. If the third parties want some fibre run through BTs conduits, then they can pay BT to do it. But the switching gear and all other hardware belongs to the third parties. They get their money back from us, especially if they have the foresight to offer business capable bandwidth on separate fibre.

    There are other issues such as port blocking, traffic sniffing, DNS redirects and ad insertion that would be best kept away from business lines too.


    Alan

  • Comment number 24.

    Telecoms companies work like any other. They manufacture something (in this case their network and network-derived services) and sell them to other people for cost+profit.
    BT spend billions of pounds investing in fibre, and then sell little bits of it to their customers. Their fixed costs are massive, and this is reflected in their balance sheet - and the value of their tangible assets.
    Companies like Talk Talk, essentially retailers, have an entirely different balance sheet, and one that is essentially incompatible with being a telecoms company (see BT's adventures in Global Services).
    Reselling someone else's fibre is easy, but essentially pointless (Talk Talk's value does not derive from reselling BT's fibre).
    Therefore comments like "have one fibre network in the country" are simply unrealistic. What on earth would the point of Cable and Wireless, or Vodafone be with no asset?
    If BT continue to screw up, somebody else will lay the neccessary fibre and make money from it.
    The other parasitic broadband companies have been given a license to print money by Ofcom - they are operating within a controlled, windfall market.
    Ofcome should instead be focused on incentivising the industry to extend their fibre to rural areas - but fundamentally through the market.

  • Comment number 25.

    Do it like the Taiwanese or Japanese...

    One Network that not only provides Fibre to the House (FTTH) but also Fibre to any Cabinet and a massive WIFI Network spanning entire Cities.

    Set a fixed Charge, that every Household has to pay, like Council Tax and allow them to access the Network.

    In the UK Providers like Sky or BT could provide Service like Triple or Quadruple Play (Phone, TV on Demand, Wireless Broadband & Mobile) in a Content Package.

    And because the Base Charge is fixed and mandatory,
    the Budget for Service & Maintenance is more or less a FIX SUM!

    The Plans for the 21Century Network from BT are outdated,
    many Asian Countries now-a-days already start invest in Gigabit (1000MBit) Networks, rather than Megabit Networks (100MBit).

    One of Taiwan's largest Telecom Provider has 15.1 Million Customers and committed to spend up to $929 Million over the next three years to get UltraFastBroadband in even the most remote Areas - adding 10 Million more Subscribers to its Portfolio!!!
    Using not only Fibre but also LTE (Long Term Evolution also known as 4G) & WIMAX for Areas where fitting Fibre is too difficult!

    And certainly BT should massively increase the Use of the latest Network Data Transfer Protocols (IPv6) to run these Networks efficiently.
    Google does that already for more than a Year...

  • Comment number 26.

    There is a slight logic problem here.
    The people with spare cash live in the country, ie outside cities, BT and Virgin are not targeting these exchanges because there are less subscribers. In my house there are several poles before the cable comes in, but I work from home and would benefit from faster broadband.

    A fiber will never happen, a cable TV service will never happen, and overall the exchange will never go above 8m even in theory.

    So as far as I can see I have low speed and as for the so called 3G..... do not get me started. All of them can go..............

  • Comment number 27.

    "Rural-fibre enthusiasts may soon be calling Carphone boss Charles Dunstone to ask him when TalkTalk's 100mbps service is coming up their lane."

    as Talk Talk aren't represented in over 50% of UK telephone exchanges we can safely assume this won't be happening any time soon.

  • Comment number 28.

    Yeah, because this really worked with the postal service. A crappy service to rural areas remains, while inner-city areas are served by a plethora of parcel companies. Or if you wish to force the issue, you could mandate BT, as incumbent, to provide service to the outlying community; and watch it go bankrupt. I don't understand the dual-expectation of BT from the public. On the one-hand we demand they act within the free-market, and allow competition by breaking open their products; then on the other we demand that they do things that are clearly unprofitable "for the good of the nation".

  • Comment number 29.

    The cost of fibre is one thing but don't forget that the cabinets need power to drive the active components and this raises another set of issues

  • Comment number 30.

    Re 29: Strong point, however some outline of fibre costs ( + digging / poles etc.) and the cabinet installation and running costs would be helpful. If a community would like a better service and might consider contributing, order of magnitude costings are needed, prior to a formal RFQ. Obviously a large community would have smaller unit costs ( contributions ) to pay; There may be a critical mass ( number) for which such a proposition is viable, but the base figures are necessary for any computaion.

 

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