The treasury broke down the investment in to three parts: a £400 million "Digital Infrastructure Investment Fund"; the introduction of 100% business rates relief for new fibre installations starting in April for over five years; and £740 million for co-ordinated trials of both fibre-to-the-property and 5G mobile connectivity.
In his speech to the House of Commons, Hammond said: “Our future transport, business and lifestyle needs will require world class digital infrastructure to underpin them. So my ambition is for the UK to be a world leader in 5G. That means a full-fibre network; a step-change in speed, security and reliability.
“So we will invest over £1 billion in our digital infrastructure to catalyse private investment in fibre networks and to support 5G trials. And from April we will introduce 100% business rates relief for a 5 year period on new fibre infrastructure, supporting further roll out of fibre to homes and businesses.
“We have chosen to borrow to kick-start a transformation in infrastructure and innovation investment. But we must sustain this effort over the long term if we are to make a lasting difference to the UK’s productivity performance.”
The £1 billion fund is part of a larger £23 billion investment into infrastructure, known as the National Productivity Investment Fund (NPIF).
The telecoms industry generally praised the investment, but warned the rollout could widen the divide between London and the rest of the country when it comes to connectivity.
ViaSat head of space and comms Neil Fraser said: “Investment in broadband should be welcomed, as long as we’re not trying to run before we can walk. The Government has to be careful that its hyper-fast strategy doesn’t widen the existing rift between broadband haves and have-nots in the UK.
“British consumers already believe that the Government isn’t doing enough to meet future broadband needs; that they can’t access superfast broadband of any type; and that investment is disproportionately focused on London and the south-east. Pledging full-fibre links that are likely to benefit those areas of the country first, while others still can’t be certain of the 10Mbps proposed in the Universal Service Obligation, will do nothing to dispel these beliefs.
“The UK is at serious risk of ending up with a two-tier internet; where those areas with fast services reap the benefits in terms of education, opportunity and investment, while those without broadband are left further behind.”
Zinwave called the announcement a “step forward” for the rollout of 5G. It will see central government give local authorities the opportunity to bid for funds to support 5G and fibre trials.
Zinwave CEO Scott Willis warned the Chancellor to make sure research into the next generation of mobile technology is focussing on the right types of equipment.
“To ensure its success, the UK Government must ensure it’s investing its £1 billion worth of funding for 5G in the right technologies,” he said. “In order to overcome the limitations of essential small cells, while providing strong and consistent mobile services inside a building, operators must combine small cells with small cell architecture, such as wideband distributed antenna systems (DAS).
"While deploying 5G mobile networks will require operators to think about their infrastructure in a new way, if they want to benefit from lower costs, easier deployment and better quality of service for their users, then a mix of small cells and DAS will be key.”
