Openreach CEO Clive Selley has unveiled a major expansion of the network builder’s fibre-to-the-premises (FTTP) broadband roll-out, pledging to hit three million properties by 2020 through a new programme called Fibre First.
Speaking in the same week that the government revealed 95% of the UK is now able to receive a so-called superfast broadband service, Selley said the internet now touched every aspect of daily life, and as such, broadband provision was critical to the future of the country’s fast-digitising economy and society.
“The statistics speak for themselves. Just three years ago, Britons used less than half the data they do now on their home broadband. Average speeds were a third of what they are now. I’ve talked to many people in my visits across the UK for whom the internet is now an essential part of daily life – from the kids doing their homework, to filing your tax return or running a kitchen-table business,” he said.
“To stay afloat on this digital tidal wave, we need to invest in the next generation of faster broadband technology – FTTP. We believe investing in FTTP is the right thing to do for the UK. We’ve already made a start – with half a million premises in Britain having access to FTTP, a majority in rural areas. But we want to go further.”
Selley said the Fibre First programme was about “how Openreach thinks” and that, in the future, the organisation would build FTTP networks as first choice wherever possible.
The build programme will accelerate by 50% over the next three years, with work on FTTP services in an initial eight cities – Birmingham, Bristol, Cardiff, Edinburgh, Leeds, Liverpool, London and Manchester – beginning later this year. There are also plans to recruit and train 3,000 new engineers.
Openreach also said that Gfast – which provides FTTP-like speeds over traditional fibre-to-the-cabinet (FTTC) infrastructure – will still continue to be deployed at scale across the UK. However, it added, it will not build Gfast and FTTP to the same locations.
“Reaching three million premises by 2020 sets Openreach on the right trajectory to achieve its ambition of building a 10 million FTTP footprint by the mid-2020s and, if the conditions are right, to go significantly beyond, bringing the benefits of FTTP to the majority of homes and businesses across the UK,” said Selley.
Investment not yet secure
However, Openreach said, the pace and extent of its FTTP investment would ultimately depend on how quickly the conditions to let it achieve an adequate return on investment (ROI) were secured, and Selley reiterated calls for support from other communications service providers (CSPs), central and local government, and telecoms regulator Ofcom.
“We believe investing in FTTP is the right thing to do for the UK. We’ve already made a start – with half a million premises in Britain having access to FTTP”
Clive Selley, Openreach
In particular, it wants to focus on achieving lower build and connection costs, achieving rapid take-up of and generating incremental revenue from the FTTP platform, and having a supportive regulatory and policy framework.
Openreach expects the cost of FTTP in towns and cities to be between £300 and £400 per property, £150 to £175 if the costs of battery backup are excluded.
It said mass market adoption at competitive prices could be pursued through new commercial agreements with CSPs, and it will explore new models to help this along. However, it also believes that, eventually, it will be essential to conduct a switchover process – much like the digital television switchover that was conducted by region – so that all customers can be moved onto the new network quickly once it is built.
Openreach said it was committed to working with all relevant stakeholders to smooth the path ahead, but warned that if its conditions could not be met it might have to reconsider its financial commitment to the programme.
Running scared?
A spokesperson for CityFibre – which announced in January that its own consumer FTTP roll-out with Vodafone will shortly commence – was a “clear response” to the increasing competition from itself and other FTTP specialists, such as Hyperoptic.
“CityFibre and Vodafone are already leading the way, with a long-term strategic partnership that will bring ultrafast Gigabit-capable full-fibre broadband to up to five million UK homes and businesses – approximately 20% of the UK market – by 2025,” said the spokesperson.
“It is recognised by government and Ofcom that the time has come to reduce the public’s dependency on Openreach. It is not in the UK’s best interest to encourage further entrenchment of the incumbent monopoly.
“As successfully demonstrated all over the world, it is a new generation of infrastructure builders that are best placed to deliver full fibre – able to deliver the next generation of digital connectivity faster and at lower prices than incumbent operators,” they added.
Hyperoptic’s Dana Tobak said she found Openreach’s motives and focus suspect. “For years, Hyperoptic has been leading the full-fibre transformation, ensuring that our cities are ready for their digital futures, while Openreach has focused on FTTC and convincing the country that we’d never need more than 30Mbps,” she said.
“We also call on Ofcom to ensure that the Fibre First announcement is not a distraction from fulfilling the strategy of 2016’s Digital Communicaitons Review”
Dana Tobak, Hyperoptic
“We also call on Ofcom to ensure that the Fibre First announcement is not a distraction from fulfilling the strategy of 2016’s Digital Communicaitons Review, which rightly concluded that the UK is best served with infrastructure competition,” said Tobak.
“Openreach must be regulated to use its own duct and pole product when implementing its FTTP roll-out so there is equivalent opportunity to build FTTP networks at scale, and that Fibre First isn’t just a marketing name for Openreach’s fibre monopoly.”
But Openreach’s Selley concluded: “I’m under no illusions about the challenges that lie ahead – it is a massive technical, financial and logistical exercise, but we have the people, the scale, the desire and the expertise to do it.”
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