Government allocates £200m for full fibre rollout

2 November 2018   By Jo Bailey

The new approach announced in this week's budget will ensure rural areas will benefit first, but is it enough to really make a difference?

Announced in the budget this week, the UK Government has confirmed it will be allocating £200m to the rollout of full fibre broadband nationwide. This is in addition to the £95m allocated in the March budget for FTTP rollout.

The announcement includes details of a new approach, which will see rural areas targeted first. Dubbed the 'outside in' approach, the rollout will focus initially on primary schools.

Among the areas said to be in line for the first connections are Cornwall, the Scottish borders and the Welsh valleys.

The allocation of money this week is all part of the Government's pledge to ensure full fibre connectivity for 100% of the nation by 2033.

fibre broadband

The UK Budget 2018 announcement

Under the National Productivity Investment Fund (NPIF), the Government announced an allocation of £770m, earmarked to "improve transport infrastructure in cities, and the next steps in the rollout of full fibre broadband nationwide."

However, in detailed announcements later on, it became clear that not a great portion of this cash was destined for full fibre rollout.

The announcement clarified that 'The Budget allocates £200m from the NPIF to pilot innovative approaches to deploying full fibre internet in rural locations'. It said that primary schools would be targeted, with a 'voucher scheme' for businesses and homes nearby.

In addition to this, the Government has said it is publishing consultations to make gigabit capable connections mandatory for new build houses. They will also be allocating £5.9m to Suffolk as part of the Local Full Fibre Networks challenge fund, destined for public building connections.

The Future Telecoms Infrastructure Review

The announcement comes on the back of findings highlighted in the Future Telecoms Infrastructure Review (FTIR), which highlighted the changes required to achieve 100% fibre and 5G nationwide.

The FTIR suggested that the total cost of a full fibre rollout would be in the region of £30bn. While much of this investment was expected to be contributed by ISPs, at least £5bn of public money was identified as being required.

This makes the current investments, totalling around £200m (not including the recent announcement) a relatively small drop in the ocean compared to what will be required.

Although some improvements have already been made, there is still an awful lot of work to be done. In August, thousands of properties in the Scottish Highlands were connected to superfast broadband, and connectivity in Wales rose from 29.4% to 94.2% in just seven years.

Although the Government announced it had met its target of superfast connections to 95% of the UK back in February, the remaining 5% are largely rural areas where both mobile and broadband connections can be cripplingly slow.

These remaining, often isolated premises are notoriously difficult and expensive to connect. The contents of the FTIR have highlighted just how far away from the 2033 target the government really is, and how much work remains to be done.

For example, in order to connect every home by 2033 to a fully fibre service, the industry would need to be adding around two million connections every year for the next decade or more. Simply in terms of skilled engineer capacity, this is a huge challenge to overcome.

Good news, or just more talk?

Since last year, ISPs have reported high levels of demand for ultrafast broadband services, something which will not be achievable until homes are fully fibre connected. The budgetary announcement, which remains unchanged from last year, is not really going to make inroads into this.

It's likely that it's a bit soon for the Government to really commit to a strategy for 2033. Undoubtedly, they are playing the long game; waiting to see what devolved powers and commercial companies end up doing on their own.

Overall, any funding is good news, but has also served to make us painfully aware of just how much more is required to achieve the 2033 target. £200m is a mere drop in the ocean compared to what is really required by rural communities to level the connectivity playing field nationwide.

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