Tuesday, 04 August 2020

Openreach’s 3.2m full fibre target could see Ofcom change regulations

by Harry Baldock, Total Telecom
Thursday 30 July 20

The network operator has a new goal to provide fibre coverage to 3.2 million of the hardest to reach premises of the UK by the mid-2020s

BT’s networking arm, Openreach, has announced plans to bring full fibre to 3.2 million homes and businesses in ‘Area 3’ of the UK by 2025/26 – those geographic areas considered to be harder to reach.    This goal falls under BT’s overall ambition of spending £12 billion to connect 20 million premises by the middle of the current decade…

BT’s networking arm, Openreach, has announced plans to bring full fibre to 3.2 million homes and businesses in ‘Area 3’ of the UK by 2025/26 – those geographic areas considered to be harder to reach. 
 
This goal falls under BT’s overall ambition of spending £12 billion to connect 20 million premises by the middle of the current decade, provided it can receive support from the government and Ofcom.
 
Back in January 2020, Ofcom was mulling the idea of introducing a Regulatory Asset Base (RAB) approach to wholesale local access pricing for Area 3, which would allow BT to recover any fibre investment costs via their customers. At the time, the regulator said it would need BT to “provide a firm commitment to build fibre in these parts of the country” if it were to allow such an approach.
 
Now, with the announcement of this additional 3.2 million premises being targetted, BT has made just such a commitment. Ofcom, as a result, has started a consultation period, closing on the 16th of September, for pursuing the regulatory change. 
 
“In June 2020, Openreach committed to build fibre commercially (i.e. without public subsidy) to at least 3.2 million premises in Area 3 cumulatively by the end of 2025/26. In light of this commitment, we are consulting on adopting a forecast RAB approach in Area 3 by indexing copper-based services of bandwidths up to 40/10 [40Mbps download / 10Mbps upload] and allowing pricing flexibility for higher speed services,” explained Ofcom in a statement. 
 
Despite the coronavirus pandemic’s associated delays and disruptions, the UK still has lofty goals for fibre coverage over the coming years. In fact, some believe this will be one of the key industries in helping lift the country out of its economic slump.
 
“This year we’ve all seen the importance of having a decent broadband connection and at Openreach, we’re convinced that Full Fibre technology can underpin the UK’s economic recovery,” said Openreach CEO Clive Selley.
 
“Openreach is leading the charge to help Government achieve its target of making gigabit capable networks available nationwide by 2025. And we hope that by publishing our own plans, we can help ensure that taxpayers only fund connections in communities that really need public support.”
 
 
What challenges do fibre broadband providers face in a post-COVID UK? Find out from the experts at this year's Connected Britain
 
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