When Ofcom announced is Strategic Review it included an innocent question asking everyone to consider if BT should be broken-up, so call Structural Separation. Recently a number of major ISPs published an open letter saying that this should be given careful consideration and that they favoured a referral to the Competition & Markets Authority (CMA). Their position is more nuanced than many of the headlines the letter generated – this doesn’t mean they are firming in favour of breaking-up BT, only that they have serious concerns about the shape of the market which BT dominates.
My own view is that Structural Separation is simply a regulatory instrument that if wielded in isolation would achieve very little – it would replace one monopoly with two, and the siblings have very deep cultural ties that were forged at the dawn of telecoms time. It would take several years to resolve the legal challenges to separation, and the many more before the cultural challenges are overcome.
Its true that in New Zealand it has made a radical difference but, with due respect to New Zealand, its got a population just over half that of London – BT’s domain is almost 20 times bigger, and its organisation is consummately bigger – it’s a supertanker to NZ’s speed boat. Structural Separation in the UK will achieve very little slowly.
In addition, the New Zealand Regulator didn’t simply declare Structural Separation; they put in place a series of measures to ensure it led to a market shape of their design, and they closely monitored the evolution.
In the UK we haven’t had the discussion about what kind of market we want or need, and we don’t have a regulator that has been strong on monitoring or enforcing change. For these reasons alone, we should be calling for a referral to the CMA – so we can have the public debate about the kind of market we want and what kind of regulation that new market will need.
There are some fundamental and huge shifts in the shape of the market already underway, some of which appear to be largely undebated. I don’t have the answers, and anyone that says they do is almost certainly wrong, but this debate needs to begin and it needs to be grown-up and open-minded.
I’m planning to post some of my thoughts over the coming weeks – I hope others will too.
Somewhat quietly the UK’s Environment Agency recently released their LIDAR data for much of England. Most people are probably thinking “so what!” but the myriad of wireless broadband operators are likely to be jumping with joy once they get to grips with what’s been released.
The LIDAR data is provided as digital elevation data suitable for GIS systems, including wireless propagation modelling tools, but that sets this data apart from the many other free elevation data is twofold:
- It’s extraordinarily accurate!
- It includes both terrain and surface models
Accurate? To put this in perspective, each pixel in the Ordnance Survey opendata terrain data is 50m by 50m while the Environment Agency pixels are just 1m across and some areas are just 25cm square. Most datasets provide a general feel for the landscape at a point but this data is incredibly granular showing every crease in the landscape.
But the really useful benefit is the release of surface models. Most elevation data is only released as terrain models, showing the underlying ground, which is perfect for civil engineering work but only partially useful for radio coverage models which also needs to know about tall trees and buildings – clutter.
If the OS opendata elevation data included a surface model its pixel size would miss many building completely but the EV data would not only capture a house, it might even pinpoint someone mowing their grass!
Together this means Environment Agency data provides a resource that should revolutionise that way wireless operators plan their network coverage.
Lincolnshire’s Bryn Davies asked the B4RL Facebook group the question: “Will it help us get better broadband into rural areas if BT is split from BT Openreach?”. At the time I posted a quick response to the effect “probably not” but Facebook comments don’t really give the space to properly answer a question like this. So here goes…
There are two parts to my thinking on this – timing and the impact.
If there is will to split Openreach out of BT Group it won’t happen over night – it’s likely to take years, way beyond the current rural broadband policy timescales, and way beyond this parliament. In principle the split would allow an independent Openreach to make independent investment decisions but this will take time to evolve with the BT culture deeply embedded within Openreach veins. It’s likely to take some time post-separation before Openreach starts to think differently, especially as the residual BT Group will remain its biggest customer.
So the first part of my answer is that assuming a split it helpful, it’s likely to require the final 5-10% of the UK to wait a very long time to see the impact.
Once Openreach learns to make strategic decisions in its own newly found image it can’t be assumed that they will be radically different from those of BT Group. Openreach would still be a scale business where exceptions become very costly, very quickly.
The hardest to reach areas are generally exceptions – they are the odds and ends that can’t be delivered using a vanilla national architecture – the long lines, the exchange lines, the poor joints, the low-grade aluminium, etc.
To my thinking these areas will never be addressable by a scale fixed-line operator without ripping up much of its current infrastructure. If the split had been done before BT embarked on a massive deployment of FttC then perhaps things might be different – perhaps – but it wasn’t and Openreach will need to start from where BT Group left off.
There may be very good arguments for splitting Openreach from BT but I very much doubt delivering deeply rural broadband will be one of them.
The final few percent is not about BT – its the domain of the niche specialists.
The debate about whether the Chancellor should tax broadband services to fund investments in the very hardest to reach areas of the UK is back again. As a concept it’s been doing the rounds for some years (Labour proposed a 50p tax in their 2010 manifesto) and it’s not unique to the UK (the US has had a levy mechanism for years) but if it’s to be effective in the UK it needs to form part of a clear strategy or run the risk of diminishing take-up and deterring investments.
What would I do?
If I were asked (highly unlikely) I’d suggest that any tax-raising measure should form part of a strategy inching towards a copper switch-off, and should ideally include a date that copper will be switched-off. By giving a date it gives investors time to back their preferred horses and for the market to prepare for an all-digital telecoms market.
To kick-start the process, any levy on broadband should be limited to copper-based ADSL services only. This helps to maintain legacy service prices without delivering a monopoly profit which by narrowing the price differential should encourage customers to make the switch to newer fibre services. This in turns helps to encourage further private investment in fibre-based services in any geography, not just the most remote.
For the sake of guesstimating, if we assume 85% of homes and businesses take a broadband service, and around 25% have made the move to fibre services already, a 50p monthly levy copper service would initially generate around £7-8m per month but as people make the move and services become more readily available then this will gradually fall towards zero. But even accounting for this, a carefully managed programme could raise perhaps £300m over 5 years.
If this were pledged to a national investment fund where it could be matched by private funds and made available to operators it should create the kind leverage some of the emerging alternative operators have been able to deliver. The Cotswolds project is working at 78% commercial funding and Gigaclear’s recent wins appear to be higher still. If that level can be sustained then a fund of £300m becomes £1.5bn.
If the fund were offered as loans secured on the network assets, and the term limited to no longer than that asset’s economic life, it naturally lends itself to longer-term fibre networks and provides a means for the fund manager to take control of the assets should the original operator run into difficulty. While using a professional fund management organisation to run the fund should help to limit the risk of bad debt rather than expect public servants to unnaturally learn to gauge risk in short order.
So, yes, by all means tax broadband but make it part of a wider strategy to move the country to fibre-based services and retire copper.
As a bit of Friday fun I’ve re-run my 3D model on parts of Lancashire to see what the landscape looks like when you have B4RN Towers alongside the low-rise living of ordinary broadband users. Continue reading
Its long been a problem that Local Authorities have published broadband maps of their publicly-funded roll-out programmes but made looking up the data really quite hard.
While a householder can usually find their own area quite quickly an operator considering investing in a wider area often finds it very much harder, sometimes resorting to manually entering postcodes one by one which may work for small areas but not for larger areas across multiple local authority areas.
I take a different approach which gives me reliable data for each and every postcode in a given local body area. Here’s how I reverse engineer LA broadband maps into tables of data. Continue reading
Following on from my articles on bringing Charles Booths maps up to date and visualising Ofcom’s broadband speed data, I’ve been looking at other ways to create webmaps that explore data visually. A feature of QGIS that I’ve overlooked for too long is the threejs plugin; it creates interactive 3d webmaps in minutes and is able take the vertical z-axis from any numerical field in the data.
This is what happens when you associate the OS Openlayers buildings layer with the Ofcom data, and ask threejs to extrude building heights from the median internet speed.
The map is interactive – take it for a spin, zoom, and change the viewing angle using your mouse.
Using the plugin couldn’t be easier – follow this video tutorial and you’ll have it working minutes.
(BTW All the data and applications to do this are opensource or opendata – it won’t cost you a penny to try it out!)