Wednesday, 1 July 2009

France Telecom threatens to stop fibre rollout?

So France Telecom may stop rolling out fibre after all the progress in NGA that has happened over the last couple of years. If this really did happen, it would be a shame.

The French business daily Les Echos reported yesterday that FT had threatened to stop rolling out fibre due to last week's decision by regulator ARCEP that multiple fibres must be deployed to buildings in certain cities, rather than the single fibre alternative FT prefers. For obvious reasons, the monofibre solution suits FT, being cheaper than multiple fibres, and also giving it more control. Needless to say, alternative operators were delighted with this decision.

It's unlikely that much cost will be added by the multiple fibre approach, and should it help prevent a lot of arguments between operators in the future.

It's also unlikely at the end of the day that FT really will stop rolling out fibre.

Regulators and Governments are paranoid that operators will fail to roll out NGA, because it would be damaging to their respective countries. Operators naturally play to this paranoia to try to ensure they get their own way.

FT will resume rollout sooner or later, after the mindgames are complete. It would be commercial suicide not to.

Digital Britain report requires a patchwork of answers

At last the UK is (preparing to) move forward with next-generation broadband, following the much awaiting final version of the Carter report on Digital Britain. It really has been some time coming, from a Government which had no direct policy on the subject for years. As widely reported in the media, the report proposes two means of improving the nation's infrastructure: a 50p levy on all copper lines to fund the rollout of next-generation access where the market will not provide it, and a universal service commitment which is intended to raise to a minimum of 2Mbit/s the quality of broadband for "virtually" everyone in the country.

Digesting and analysing the findings of the report has taken up a substantial amount of my time since the report launch, these being my initial thoughts. What is clear from the USC is that a patchwork of solutions will be needed: it is highly unlikely that a solution like cellular or satellite will be cost-effectively able to provide reliable 2Mbit/s coverage to the 11% of homes who currently have connections slower than that speed.

Satellite, purely by the laws of physics, suffers from latency problems, which won't be a lot of good for time-critical applications like gaming or VoIP, and it may cause VPN issues too. Satellite providers are trying to reduce latency, but still the laws of physics remain. Mobile should in theory be able to help, but in order to provide a 2Mbit/s service a great number of base stations would be needed in rural areas. One can sense that the business case for this is weak indeed.

Don't get me wrong. I think satellite has its place: in France the universal service commitment could in theory be entirely provided by satellite. But that's unlikely in the UK. The UK's USC demands of 2Mbit/s are four times faster than that of France, whose Government is only seeking 512Kbit/s.

And BT has expressed a wish for serious involvement in the USC, with a range of fibre and copper solutions to plug the gap, making a fixed alternative all the more likely. Those are in development right now.

Critical to the USC will of course be how the funds backing the scheme (separate to the 50pence levy) will be allocated by the Network Design and Procurement Group, the organisation set up explicitly with that function. There are many questions that have to be answered there, and we won't know for months how that will pan out.

What is for certain is that the broadband landscape in the UK will change markedly.

Of course, with potentially 90% NGA, a rather paltry 2Mbit/s for the slowest lines is going to be pretty slow. Therefore, we may be facing a new kind of digital divide.