Friday 18 September 2009

EU green light to state aid for rural broadband

The European Commission has adopted Guidelines that will help Member States to accelerate and extend broadband deployment, allowing public support to foster investment in this strategic sector without creating undue distortions of competition.

Competition Commissioner Neelie Kroes said: “ The Guidelines will facilitate the widespread roll out of high speed and very high speed broadband networks, enhancing European competitiveness and helping to build a knowledge-based society in Europe."

The guidelines distinguish between “white areas” (rural and underserved area) where support for broadband network deployment is in line with existing Community policies and “black areas” where at least two broadband networks are present and where State Aid in not required. Typically, there are also “grey areas” where there is a need for a more detailed assessment.
Last month the EC gave the green light for plans by the Welsh Development Agency (WDA) to construct an open, carrier-neutral, fibre-optic network to wire up 14 Welsh business parks in North Wales.

NetStrategics can help planners work through the detailed conditions in the Guidelines – contact us on huw.williams@netstrategics.co.uk

Wednesday 9 September 2009

£2m available for Digital Britain projects

Funded by the Department for Business Innovation and Skills, the Technology Strategy Board (TSB) is planning to fund at least 80 projects on Digital Britain, with a total budget of £2 million. The TSB will fund 75% of feasibility studies proposed by SMEs, small or micro businesses, costing up to £33,000 of innovation in business models, applications, services and technologies.

But if you want to get your hands on this money, you’ll have to move fast – the closing date for proposals is noon on October 1st – and not a minute later.

Creditably, you only need a one page proposal, but you will need to make sure that is well written, concise and compelling, and that the market opportunity is clearly set out. Most importantly, you need to show how the proposal aligns with the scope of the programme:
· Economics of the network
· Economics of content and services
· Access, protection and enablement

One of the four priority areas which the TSB is particularly interested in is “Cost-effective deployment and operation of digital infrastructure”. This is looking for feasibility studies which offer ways of overcoming the cost barriers to next-generation infrastructure development, eg:
· Community initiatives to increase broadband access in a way that reduces costs of deployment
· Ways to reduce the amount of energy used to run telecoms networks
· Ways to reduce running costs of networks

The other priority areas are:
i. Enabling technologies for the internet: core functional technologies that help with areas such as meta-data management of content, revenue distribution and payment processing, quality of service control, personalisation and privacy, or management of data within the home
ii. Access to public service information: eg how to increase accessibility to and public engagement with online public services
iii. Applications and services - ”other”: eg new models for distributing and managing digital content, such as those based on metadata; trusted services models; personalised services and interfaces.

NetStrategics attended the BIS briefing session yesterday, and can help you pull together your proposals. Contact me at huw.williams@netstrategics.co.uk

Telecoms Regulation: Telecoms Regulation: Do Stephen Carter's numbers add up ?

Telecoms Regulation: Telecoms Regulation: Do Stephen Carter's numbers add up ?

My reply to LIndsey was:

"Hi Lindsey,

Thanks for your query – it’s nice to know people read some of the stuff we write !

Interesting that you point out that 27.2m is probably a high figure. Actually I received today Ofcom’s latest market data (see attached). That gives a figure of 23.5m fixed residential lines and 9.5m business lines.

As you rightly suggest I made the simplification of number of premises = number of lines. It could in fact be higher or lower – premises without lines, and multi-line premises. With ADSL, I think we are seeing fewer of the latter. If you do make the simplifying assumption, then the actual figure doesn’t matter much as it is a factor in both the revenue side (N*£6) and in the cost side, and so drops out.

Of course this has all become a little academic, as there is no prospect of the £6 levy being in place before the election, and there is little sign that the Conservatives (who I guess must be odds-on favourites at present) would give this priority.

So I don’t see any nationwide roll-out any time soon. BT will go as far as it can, and CBN groups will try to pick up the slack. My interest is how one can make business cases for those trials work – I think the involvement of local councils who may be able to justify including other benefits may be the way to crack it.

Happy to talk more

Huw"

Telecoms Regulation: Do Stephen Carter's numbers add up ?

Telecoms Regulation: Do Stephen Carter's numbers add up ?

Lindsey Annison sent me the following comments:

"Disclaimer: I am making no claims to being a mathematician or accountant, and like to keep things simple. ;o)

In your blog post about Carter's figures, you use Analysys Mason's figures of 27.2m. That is landlines IMHO not premises. I spent hours on the phone to ONS etc and was repeatedly told 20m homes and up to 5m max business premises. (This figure is very ahrd to determine as there are so many farms, SOHOs, home businesses etc apparently who could feature in both figures)

The AM figures imply at least 2.7m second/third lines but it would be VERY interesting to get the true number of multiple phone lines into single premises from BT et al.

If you repeat the figures using 20m, then it comes to £2bn to do the final third with FTTH and 36% take up. If each of those homes were paying, for sake of argument, £30/month eg £360 pa, the revenue generated in year 1 alone would be £2.6bn (by my maths). On a standard telco/infrastructure model, payback would be over 10 -15 years so I cannot begin to see how this can't be justified easily.

To continue, no-one in their right mind is going to go into a region/community and deploy fibre without passing every home/premises where at all possible. Lessons learnt from NTL!! So, whilst in year 1 take up may only be 36%, in rural communities such as ours, by year 2, you would have picked up the majority of users, except the digitally reluctant, and could possibly double the 36% without too much grief. That second wave of subscribers would only therefore need kerb/gatepost to home connections, with related costs approaching zero, particularly if the householder does that bit themselves as in the Nordics.

So, do you fancy expanding on the maths for FTTH and disproving that £28bn and showing just how feasible the final third is?

Regards
Lindsey"