Go to:

There has been a lot of talk recently regarding the cost of rolling out a NGN (next generation network) for the UK. Indeed, the British government has been calling for a while now for a national rollout of fibre. But the problem still remains, who is to pay?

Essentially, in order to dramatically increase broadband speeds, fibre to the node (FTTN) or fibre to the premise (FTTP) has been touted as the way to provide the UK with broadband speeds of 50MB/s and upwards.

The problem has always been the cost of physically putting fibre in the ground, mooted to be somewhere in the region of £6 billion ($10.5 billion) for a nationwide FTTN rollout, and up to £18 billion for a national FTTP rollout.

Indeed, BT's recent announcement that it is to spend £1.5bn pounds rolling out super fast broadband to 10 million (or 40 percent) of UK homes by 2012, was welcomed by many, but in reality just confirmed suspicions that the UK will end up with a two tier broadband network, with the rural communities having to put up with much lower speeds than their city dwelling cousins.

But even with new technologies coming along that allows for the replacement of copper with fibre using existing telephone ducts, without excessive digging, it seems that the cost of a FTTN or FTTP rollout is still very expensive indeed.

The government's advisory group on broadband, the Broadband Stakeholder Group (BSG) has just published a report on the costs of deploying fibre-based broadband in the UK, and it is clear that a billion pound investment alone will just not cut it.

The report (available here), has been produced by Analysys Mason for the BSG, and it suggests that rolling out fibre nationwide would cost anywhere between £5.1 billion and £28.8 billion (depending on the technology used). It also says that the costs of deploying in rural areas will far exceed the costs in urban areas.

It finds that a national deployment of fibre to the cabinet (FTTN - the cheapest technology option) would cost £5.1 billion. This figure is three or four times more than the telecoms sector spent deploying today's broadband services.

This can be broken down as follows. In order to roll out fibre to the cabinets near the first 58 percent of households could cost something in the region of £1.9bn. The next 26 percent would cost about £1.4bn and the final 16 percent would cost £1.8bn.

Meanwhile taking fibre to every UK home or business (FTTP - the most expensive technology option) would cost as much as £28.8 billion.

So the question remains who is to pay for this? Is it fair to expect the private sector to pick up the bill for installing the network? After all, many agree it will be a good investment for Great Britain plc. BT has shareholders, and with the greatest will in the world, they will never sanction a £28 billion spend.

So maybe it is time now for the government to put its money where its mouth is, and actually start investing in next generation infrastructure? Personally, I won't be holding my breath.

Contact Us

For editorial queries:
Max Cooter max@techworld.com

For website issues:
Email webmaster@techworld.com

For commercial queries
Russell Kearney russell_kearney@idg.co.uk