Mapping Our Access To The Information Superhighway -Penrith And The Borders Broadband Conference Shows That We Really Can Connect Cumbria’s ‘Final Third’ To The High Speed Lanes – if community engagement is sufficiently enthusiastic.

For Rory Stewart’s Broadband Website with an increasing array of conference related resources Please Click Here
Many, many thanks to our citizen reporter John Popham for filming and mounting his video on Youtube

PART II  SOLUTIONS TO THE BACKHAUL (second in a series written between bouts of Apple Juicing)

The second part of Rory Stewart’s broadband conference at Rheged focused upon solving the issue of getting backhaul in rural areas. To read Part I please click here.

The problem of getting backhaul (the power to upload data back onto the internet) was examined by the next series of speakers. There is a concern that the big providers like BT and Virgin may be very preoccupied with speeding up services for our urban populace and that our small remote communities are likely to get left behind.  Barry Forde (NGA advisor to the government and key brain behind the CLEO network for schools) explained why it was necessary to break with that pattern and how it could be done. He pointed out that though Eden is 97.5% rural with half our population living in small villages and hamlets (so we’re not all likely to be covered by the big providers), we are blessed with three potential sources of public access to the core internet via fibre-optic cables, the Network Rail optical fibre network that runs alongside the Carlisle Settle railway track, and the CLEO network – a very forward-thinking program to connect our schools (Primary at 10 Mbps and Secondary and higher at 100 Mbps) and finally our NHS medical centres at 100 Mbps. While it could cost upwards of £40,000 to get 100Mbps backhaul independently, it would cost very much less to connect to the existing infrastructure provided that it was opened up. He advocated liberating that potential in unused bandwidth and sharing the costs in return for the access – boosting up the Primary schools’ backhaul to 100Mbps and sharing that cost with the local community users, tapping in to the Network rail and NHS networks too where that was feasible and likewise defraying costs.  See his very interesting speech below:

Chris Smedley (Chief Executive of GEO) introduced his company as an optical fibre specialist working at the infrastructure level behind the scenes (along gas pipelines) across the country, that would be able to help some Cumbrian communities connect to the core internet. Geo has 3000km of fibre network nationally and supplies businesses with connections speeds of up to 20 Gigabits per second. They have optical fibre running through Kendal all the way to Carlisle. He warned that there would need to be a lot of infill build between the core network and the end users over the next two years and he said that Geo can help people to complete their connection.

He advocated building capacity with a mixture of technologies, using the CLEO network, but also looking at masts with unused capacity (Wimax and 3G) and even looking at improving service through the copper wires as BT were doing, by basically moving the end of the fibre connection as close to the customers as possible. He finished off his speech with an appraisal of what sort of service rural Cumbria needs – as the fourth utility it has to be: high quality, long-term infrastructure, capable of repair,  capable of cycling through upgrades every 5 years or so, it should not be a ‘stranded investment’ and should be open to all – and not monopolised. He stressed that it should  be optical fibre all the way to residences and masts. The speed targets should be ambitious because we’re building this to be useful for future generations and applications.

Mr. Smedley said that we can predict the future of high speed broadband – because there are existing models in use in different places today such as The Netherlands, including, but not limited to:  High Speed Symmetrical Internet (upload and download), Video conferencing, Cloud Computing, On demand content delivery, Virtually unlimited bandwidth, Smarter transportation grids, Multiple media streams- including HD and in future 3DHD (I’m looking forward to that), in-home health service, Local mobile and wireless services, Environmental benefits, Less road/parking congestion, Smart energy grids, Smart monitoring, Working from home.

Chris went on to say that market forces will connect the urban populations, but they will fail to connect the rural communities, a larger proportion of the estimated £20-30 Billion overall cost to attain NGA would be entailed in connecting the last third of the nation, the rural populace and the profit incentive for business investment isn’t sufficient, so there will need to be government assistance – probably to the tune of about £5 billion on top of BT’s £2.5 billion to roll-out a cheaper intermediary phase of development.  This intermediary (cheaper) phase would yield ‘future-proof’ (upgradable  to NGA quality) backhaul of between 2 and 20Mbps in the short term, but for this to happen we need access to existing core internet optical fibre networks and telephone poles and ducts now.

This cheaper pre-next generation access phase will be realised faster, because:

a) it’s more affordable, therefore more people will sign up for it and open wider competition which will drive down prices,

b) more different operators are actually capable of delivering the solutions so more can happen simultaneously across Cumbria

(It’s possible for revenues from the intermediary development phase to help pay for the upgrade to the following NGA phase – in essence this is what The Great Asby group appear to be doing – it’s a self-sustainable development path)

However, for this plan to work, it is important that the public sector continues to use the networks and doesn’t tax the private use of them (tax payers have already paid for them).

Understanding the ‘final third’

Aidan Paul (Chief Executive of Vtesse Networks) spoke next, and he described how Vtesse was concentrating specifically on serving ‘the final third’ and that they have been very busy learning about issues involved – particularly the barriers and threats to achieving the 2Mbps universal service provision standards. He illustrated their activity by talking about their pilot scheme in a place called Hatt in Cornwall, undertaken in partnership with Virgin Media.

Vtesse have discovered that final third settlements are fairly evenly distributed across the nation. Mr. Paul remarked that Lincolnshire’s relatively small population (for example) is due to the absence of large cities, not due to a proportionally larger number of  smaller communities. This has helped them to draw conclusions that have relevance to Cumbria from a number of studies conducted elsewhere in the country. Nationwide, they have identified between 12,000 and 18,000 settlements in the ‘last third’, there are 12,000 settlements that are between half the size of Hatt and twice the size of Hatt, representing about 11% of the population, and there are 18,000 settlements that are between half the size of Hatt and four times the size of Hatt representing 23% of the population.  Soon they will have passed 2000 homes above the 2mbps threshold and they’re aiming to pass a million.

BT Data from Aidan Paul's Speech
BT Data from Aidan Paul’s Speech

Aidan explained by use of the above slide, that in order for Vtesse to serve the final third under current rental prices (@£127.61 per connection) they would have to pay over £2 billion to BT for use of their sub-loops. That’s fairly prohibitive. He went on to show that there is space within a BT duct for more fibre, but explained that the configuration of cable would need to be adjusted for optimal use.

Historical reason for high business rates
Historical reasons for high business rates explained by Mr. Aidan Paul of Vitesse

High business rates were identified as another impediment to rolling out broadband to the ‘final third’. Apparently this chain of events was a consequence of King Henry VIII’s dissolution of the monasteries, because the resulting absence of Alms Houses necessitated the introduction of business rates by Queen Elizabeth I through her Poor Law.

Finally Aidan provided us with a wish list that would enable provision of high speed broadband to the final third of homes in time to meet the Government’s Universal Service Commitment target of 2Mbps broadband access for everyone by the end of 2012.

Vitesse wish list
The Vtesse ‘Shopping list’

The above slide shows the shopping list of conditions that Vtesse believe would enable achievement of the USC in the ‘final third’, in short cheaper access to poles, fibre and ducts, cheaper rental of BT sub-loops, access to black fibre for backhaul, equitable business rates, revision of code powers and prevention of extortion by landowners, and cooperation from local Councils vis a vis planning for digging up roads, crossing bridges etc.

It now only remained for the last speaker from this panel, Mr. Gareth Davies (Competition Policy Director OFCOM) to explain how OFCOM intends to “establish a regulatory environment that will foster innovation, investment and competition”. Where OFCOM finds ‘market power’ it can impose obligations on the dominant provider in a way that fosters investment and competition to take place. It does this by conducting market reviews, and OFCOM’s in the process of completing two that have a bearing on broadband provision in rural Cumbria, the first review concerning infrastructure access is due to be published at the end of September and the second, concerning wholesale broadband services that are made available to Internet Service Providers for retail to end users will be published in October.

We learned from Mr. Davies that OFCOM has found that BT has market dominance in terms of access and so will be obliged to (unbundle) open up its local loops; in over 70% of the country BT has unbundled its local loops thus providing room for competition to develop, and where that has occurred OFCOM has been able to deregulate the downstream wholesale market because BT no longer has dominance in the face of strong competition. However in Penrith and the Border constituency only one other provider has stepped forward and this one only in Penrith (out of 30 exchanges), which means that for 75% of the population the only provider is BT. We were also informed that factors that negatively affect the performance of the network – such as topography and distance from the exchange are notable in our area and that prices tend to be higher for slower service. However there are options when it comes to retail service providers – customers do have a choice of ISPs.

To address this situation OFCOM is adopting two strategies, the first is VULA (Virtual Unbundled Access) and the second is called Physical Infrastructure Access, primarily dealing with ducts and poles. BT has promised to deliver NGA to areas that represent 66% of the national population, and in the areas where it does that, OFCOM has asked it to provide VULA to enable competitors to compete in the retail market. OFCOM won’t regulate the price of VULA initially, in order to encourage BT to roll out the service as quickly as possible.

OFCOM has asked BT to open up use of its ducts and poles, and in some areas this will allow competitors “to get there first”, Virgin Media has expressed an interest in using this infrastructure to expand its area of coverage beyond its current 50% of the country and this sharing of infrastructure is expected to make it feasible for new market entrants – like community based schemes.

BT has already begun looking into opening up this infrastructure and some workshops have been held with interested parties to develop the facilities. OFCOM would like the OCA (independent adjudicator) to oversee this process of opening up BT’s infrastructure. BT will produce a draft reference offer for the new service early next year for service launch in mid 2011. Public funding will be necessary and OFCOM will keep an eye on developments. OFCOM is particularly interested in seeing that the Internet Service Provision is openly competitive at retail level and don’t want to see a host of small monopolies develop. Where state funding is involved State Aid rules will ensure that providers provide wholesale services so that others can compete. OFCOM will also ensure that BT will provide unbundled access from street cabinets to premises – they have been offering this service for some time already, but uptake as been low. This has been changing with groups like Vtesse becoming involved. An industry group has been set-up to develop this product further and it’s trying to improve the pricing.

BT is obliged to provide wholesale broadband in areas where it has market dominance (Much of Penrith and the Border), OFCOM is proposing price control in such areas to make sure that services aren’t overpriced and to make incentive for development of the ADSL 2+ technology that can provide speeds up to 24 Mbps. In November the details of the proposed control will be published.

Gareth Davies explaining OFCOM’s regulatory environment

This completes part II of this coverage. Part III will cover some solutions that have emerged in the USA.

————— Lindsy Annison has kindly provided the following very interesting information ————-

The firm is called Vtesse not Vitesse as I had earlier said.

“BT need to be forced to sub loop unbundle. Loop unbundling means that many exchanges have multiple providers; sub-loop unbundling brings that choice closer to the home and right into the first mile.

However, we should not get lost in sub-loop unbundling where regulation will undoubtedly become a barrier to FTTH and Digital Village Pumps, as will negotiating details with the sub-loop owner (s) – mainly BT but others KCOM f’r instance have cabinets.

You don’t actually need to use BT infrastructure at all to get FTTH or even FTTC (Curb or Cabinet, pick your poison).

Long discussions were held at and post-colloquium about what a ‘cabinet’ or DVP should look like etc. (The inclusion of the arts projects made for a truly exciting discussion on that issue!)

And it is easy enough to build your own as Ashby in Lincs have just proven, following many other communities elsewhere who have circumvented the need to use the incumbent telco by building their own exchanges and cabinets.

BT are extremely worried about this turn of events, as they should be, because if I, for instance, got access into backhaul, why would I then complicate matters by involving BT when a nice local farmer has said I can build my own cabinet on his land, in a much more convenient place to reach as many in the community as possible, and hence bypass BT entirely?”

Thank you very much, Lindsey.

————Commercial Message——————-

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14 thoughts on “Fast Broadband For LVC. Part II SOLUTIONS TO THE BACKHAUL

  1. Pingback: Sharing The American Experience, Recovery Through Broadband Expansion – A report from Penrith and the Border Broadband Conference at Rheged – Part III « LVCP News

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  3. Pingback: Cumbria Broadband Boost | Rory Stewart MP

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