We now have the cart and the horse – time to put them in the right order

Now that we have all had a chance to try and draw breath over the summer it seems opportune to reflect on how potentially seismic a change the Future Telecoms Infrastructure Review may come to signify.

The approach being taken by Government is a major shift away from a focus on incremental upgrades of our existing copper-based network which predominantly relied on service level competition to something more structured and focused on collaborative infrastructure competition to deliver full-fibre and 5G networks.

If we are to deliver on the ambitious targets of full fibre coverage to reach 15 million premises by 2025 and full coverage by 2033, with 5G coverage by 2027 it is clear that Government and Ofcom must hold up their of the bargain in terms of fiercely bearing down on the costs of deployment (from wayleaves reform to greater certainty around business rates), facilitating a more collaborative level of competition and, where necessary, subsidizing rollout. These are not small asks.

But it is likely that Government, both central and devolved, and Ofcom will need to do more. Whilst the FTIR was delivered at a timely juncture from a policy perspective it was far from an empty playing field. This is not an exhaustive list but measures currently being taken by policy makers include;

• A Universal Service Obligation currently working its way through Ofcom with a target date of summer 2019 for a Universal Service Provider of 10Mbit/s across the UK
• The £740m pot of money allocated to the Local Full Fibre Networks and 5G and Testbed programmes
• The ongoing BDUK Superfast Broadband which is now focused on driving as far into the 95-100% of premises as it can
• The Digital Infrastructure Investment Fund; the £800m fund of Government and private funding designed to catalyse investment in full fibre networks
• Scotland’s R100 Programme comprising £600m to reach the very hardest premises with likely a mix of Superfast and full fibre
• Wales’ successor programme to the Superfast Cymru Programme

In isolation, and certainly in the pre-FTIR world, each of these projects make sense and can deliver value. Additionally, some of them naturally align to Government’s new targets. But not all do in their current form.  Indeed some of them add risk to the significant investment needed to build out Full Fibre and 5G networks.

Take the USO for example; this will address the very same areas which will presumably be covered by the Government funded outside-in approach to full fibre. Ofcom’s job is not easy – it has been instructed in primary legislation what to deliver and is bound to an extent by the terms of the Universal Service Directive. But are we really going to invest something in the region of £300-500m in providing a 10Mbit/s connection and then re-visit with public funds to deploy full fibre within a couple of years? Not only is this a potential waste of funding but it might act as a disincentive for commercial investment too.

That’s not to say that there haven’t been baby steps towards more cohesive and joined-up thinking. For example, the  teams running the Better Broadband Scheme and the Gigabit Broadband Voucher Scheme have merged into one to make best use of both knowledge and capability as well as to align the programmes.

But if industry is to deliver what will amount to at least 2 million premises passed with full fibre (and that is without counting overbuild) every year for the next decade we need to go much further and make sure that every penny being spent now unlocks additional industry investment and drives us closer to a full fibre and 5G future.  The policy goal is clear, now we need to make sure our existing interventions are aligned behind it.