DCMS: £10m ‘Alternative’ Broadband Trials Will Help Smaller ISPs Win BDUK Deals

The UK Government claims a series of pilot schemes have demonstrated smaller telecoms providers have the experience and confidence to compete with larger firms like Virgin Media and Openreach for government contracts.

The pilot schemes were aimed at discovering how “alternative” technologies could help deliver superfast broadband to some of the hardest-to-reach parts of the nation

Seven firms are participating in the £10m trial, with pilots taking place across the UK. Avanti and Satellite Internet are using satellite, Airwave, Quickline and AB internet are using fixed wireless and Call Flow and Cybermoor are using a combination of fibre to the cabinet (FTTC) and fixed wireless.

So far, the vast majority of public funding available from Broadband Delivery UK (BDUK) has gone to BT, with FTTC the predominant technology used to connect areas not covered by commercial deployments of fibre.

This has led to criticisms from MPs and rivals that the government is effectively subsidising BT, which itself has been accused of being less than transparent about costs. Some critics also feel the government should be looking at fibre to the premise (FTTP) technology.

Alternative trials

However five “smaller” suppliers have been successful in ‘phase 2’ of the BDUK-funded rollout and believes the pilot schemes will encourage more to bid for ‘phase 3’, which will connect the ‘final five’ percent not covered by phase 1 and 2 and will require alternative technologies like satellite.

“Our pilot scheme has demonstrated that alternative technologies can help us take superfast speeds to the hardest to reach areas of the UK and I’m very pleased that smaller suppliers are now competing for, and winning, contracts for the next phase of the rollout,” said Ed Vaizey, Digital Economy Minister.

Cybermoor’s trial in Northumberland has the best adoption rate, with 24 percent of premises covered taking up superfast broadband, while AirWave has a 17 percent adoption rate in North Yorkshire, Call Flow has reached 13 percent in Hampshire and Satellite Internet the same figure in Somerset.

Avanti has reached just three percent in parts of Scotland and Northern Ireland, while Quickline has secured eight percent in Lincolnshire. AB Internet’s trial in Monmouthshire has yet to launch, while all of the projects apart from Cybermoor are still adding more premises.

Government assistance

By way of comparison, 22 percent of all premises passed by Openreach’s fibre network have adopted superfast broadband services.

“Participating in a large scale project like the Market Test Pilot programme, has enabled us to improve our processes, as well as driving change in the industry,” said Andy Conibeare, managing director of Call Flow. “As a result, we have been able to successfully bid for, and win, significant State Aid funding to build similar solutions in Berkshire.

“Call Flow are now planning to build on this experience, and will be bidding for the State Aid funded opportunities in the coming months, with contract values exceeding £50m. Additionally, we are exploring funding options to take advantage of the significant commercial opportunities that still exist that do not require State Aid intervention.”

Satellite in particular is seen as a way of connecting the final five percent, with up to 300,000 homes and businesses eligible for vouchers that will cover the cost of installation. BT has signed up Avanti and Satellite Solutions for the project.

Up to four million properties that would not have otherwise been covered by superfast broadband have been connected as a direct result of government projects.