Broadband

Providing a nationwide network of next generation broadband could cost as much as £29bn, according to the influential telecommunications industry body, the Broadband Stakeholder’s Group (BSG). If that leaves ISPs and broadband users wondering where the investment is coming from, the long awaited ‘Caio report’ (PDF download) suggests that it’s unlikely to be coming from the Chancellor.

Francesco Caio, former CEO of Cable & Wireless, was tasked six months ago with compiling a report for the government on whether he could see any obstacles to rolling out next generation broadband. Talking ahead of officially releasing his findings he told the BBC, “There is little evidence that in the short term the UK is going to suffer from the lack of an extensive next generation access network.”

His advice to the government is that it should not feel obliged to invest in a fibre roll out but rather to create a regulatory framework that will attract investors. He summed up BT’s announcement of a £1.5bn fibre roll out and Virgin Media’s work on upgrading to 50Mbps services as “promising signs”.

However, the £1.5bn investment, whilst welcome, has been dwarfed by figures published in the separate report from the BSG which estimates, at the very least, £5bn would need to be put in to providing fibre to the street cabinet (FTTC) which would then be taken in to each home via copper cable.

To actually provide a 1Gbps fibre to the house (FTTH) and to every business in the UK would cost a massive £29bn, it warned. However, this could be reduced to £25.5bn by using Gigabit Passive Optical Network (GPON) to share a 2.5Gbps connection among 32 premises.

The BSG admits the figures are “daunting” but hopes it will “focus minds” on how to fund a next generation roll out. Much of the cost has been put down to the physical work of digging up roads to lay new fibre but the BSG is advising that there could be savings from companies sharing cable ducts, which Ofcom is currently considering.

The government has promised a response to Caio’s report “in due course”. The government advisor has hinted that pressure to provide fast internet access to all homes could be abated by using radio technology to reach remote rural areas.

Tags: BSG, Caio, fibre optic, fttc, OFCOM