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UK developing “digital divide” due to low gigabit penetration

steve leighton small Voneus.jpg

The United Kingdom is developing a digital divide due to a gulf in connection quality and speeds that could jeopardise the country’s ability to meet its 2025 target for nationwide “gigabit” connectivity.

Speaking to Capacity, Steven Leighton, CEO of Voneus said that an earlier focus on fibre infrastructure has side-lined the use of more cost-effective and easier to implement alternatives, including fixed wireless access networks, 5G and even microwave links to reach remote islands off the coast of Scotland.

“When you are looking at the more rural areas like we are, some of those regions are simply not going to be right for fibre, whether it’s a geographic or topographical issue. Some of them will never have fibre delivered, but you can still get gigabit connectivity to those communities by using enhanced fixed WAN or 5G, or you can use any combination of fibre, 5G or fixed wireless access.

“There is investment going on currently, but most of it is in the urban areas and the rural guys are being left even further behind. We have a digital divide developing between those in urban and semi-urban areas, and those in rural areas,” he added.

According to Vonues, while a significant fibre build in a large urban area could have an ROI of up to 15 years, the firm’s fixed WAN solution can achieve an ROI of “four years or less”.

“My customers just want something that is affordable, accessible and reliable. In these rural areas they feel quite strongly that these big guys are leaving them behind when they are building networks and rolling out their plans,” Leighton added.

Data released by the Organisation for Economic Cooperation and Development (OECD) in March confirmed that nine out of 37 OECD countries had “full fibre” for more than 50% of total fixed broadband connections. Penetration in each of the top countries varied from Norway (ninth place) at 50.74% to South Korea (first place) at 81.65%. However, in 33rd place the UK recorded a mere 2.33% penetration.

The UK government does appear to have changed track, and in mid-2019 rhetoric switched from the promise of “full fibre” broadband to “gigabit” connectivity by 2025, despite investment in fibre broadband being central to Conservative party pledges for some months.

This year, the £1 billion Shared Rural Network (SRN) was announced to improve coverage in rural areas of Scotland, Wales and Northern Ireland. In Scotland coverage once the SRN is complete will be 91% from at least one operator and 74% from all four operators – compared with today’s 80% and 42% respectively. The SRN was part of a £6 billion package designed to boost Britain’s digital infrastructure.

Promising further progress, two weeks ago Ofcom closed consultation on its Wholesale Fixed Telecoms Market Review 2021-26. Launched in January to “promote competition and investment in fibre networks”, the results are due to be published early 2021.

However, research released this month by the Independent Networks Cooperative Association, showed that the number of premises with full fibre infrastructure supplied by altnets, such as Voneus, will rise to nearly 14.25 million homes and business, covering 50% of the UK’s population, "which may include some double counting from overbuild. This will include around 4.8 million live connections", the paper read:

Echoing Leighton’s observations, Andrew Shilton, solutions director at MLL said: “The money being awarded to individual projects isn’t anywhere near enough to cover rural roll outs. The cost of getting to some of these rural places is just never going to be covered and it’s far higher than the cost of the fibre to actually do everything.

“With the DCMS money are we trying to get other providers out [to these locations] or be in a position where it’s a virtual monopoly still? It would be good to have at least a couple of infrastructure providers battling it out so then you wouldn’t need to worry about all the regulation and abuse of market power that I think we have seen in the industry,” he added.

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