Currently only a tiny minority of businesses and households in the UK have access to fiber to the premises (FTTP). That puts the UK far behind other nations, both near and far.
UK household penetration is currently at 7.1%, according to Ofcom. This lags our European neighbors: Spain, for example, is at 71% and Portugal at 89%. Compared to Japan and S. Korea there's a veritable chasm, at 97% and 99% respectively.
While many UK consumers and businesses have fiber to the cabinet (FTTC), that copper "last mile" link puts a considerable dent in both performance and quality of service. Therefore, it's encouraging to see the UK government has already publicly committed itself to ensuring every business and household has full-fiber to the premise by 2033. It's also laudable that the prime minister wants to bring this date forward to 2025. Apart from consumers who want high-speed, low-latency access to websites and streaming services for leisure and entertainment purposes, UK PLC needs it to effectively compete on the world stage. Let's hope the government further increases its commitment to speeding full-fiber roll out across the nation.
Like transportation or energy and water utilities, ultra-fast broadband is essential to our economic infrastructure. It should be viewed as such if there's ever an overhaul of today's outmoded planning laws where individual councils and landlords hold most of the cards. Government must also review the fiber taxation rates levied on providers as part of this overhaul.
Together, these rules and taxes obstruct or unnecessarily delay the way forward for widespread full-fiber roll out. Turbocharging deployment to 2025 will demand even further investment and more manpower, notwithstanding modern techniques such as narrow trenching which facilitates fiber cabling along roads.
Fresh thinking required
Despite these legal and logistical hurdles in the path of progress, the wheels of commerce and industry must -- and do -- continue to turn. Clearly, there are many areas of the UK where businesses are underserved when it comes to accessing ultra-fast broadband. This presents exciting market opportunities for the more innovative and nimble full-fiber providers.
For diversity from road routes, for example, a provider can make use of Access-to-Infrastructure (ATI) legislation, which allows providers to reach infrastructure via means other than road. These include rail and canal ducts, or utility infrastructure. As we speak, Nextgenaccess is engaged in a large fiber deployment along a major rail corridor in the south of England. Infrastructure-based carriers looking to expand their reach, and asset-light operators seeking alternative access routes also are interesting targets. Likewise, traditional and edge data centers that require greater diversity, security and resilience are good prospects. Furthermore, with 5G, mobile operators are looking to use new strategic fiber deployments for easing their growing backhaul data traffic challenges.
While Digital Britain is certainly no free-ride for fiber infrastructure providers, the potential rewards are significant provided you are innovative, take a long term view and ensure significant investment funding is in place. The government subsidy voucher schemes also go some way to making the business case stand up.
The connectivity story has always been the same when it comes to risk versus reward. The infrastructure provider takes a long-term view and must expect to take lower margins, providing operators and channel partners the opportunity of layering services (like VoIP and hosting) over the top. This presents ongoing, more margin-friendly business opportunities for them but in return they take all the risk on the customer. That's the quid pro quo and keeps all sides engaged and motivated.
To make it work, Nextgenaccess, for one, is being very careful to fully evaluate the long-term potential ROI from existing and emerging UK opportunities. This means being highly selective and only going places where no, or very few, providers have gone before. Avoiding overbuild situations is a key part of our strategy, as is having an anchor tenant in place from the outset and sufficient 'in-need' underserved end-user business communities in plain sight. These are prerequisites before any of our fiber gets deployed.
It certainly helps to have been one of the first licensed to use BT Openreach infrastructure for deploying fiber networks under Duct and Pole Access (DPA) / Physical Infrastructure Access (PIA). Using BT Openreach infrastructure and our knowledge makes fiber deployment far quicker and significantly cheaper. For example, we are using DPA/PIA to deliver a new high capacity fiber route between Bristol and Wales. In conjunction with carriers and our reseller partners, this will enable ultra-fast broadband connectivity and services for thousands of underserved businesses in south Wales and southwest England by early next year.
— Mark Weller, Managing Director, Nextgenaccess Ltd.
This content is sponsored by Netgenaccess Ltd.