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Telcos snub UK.gov broadband cash pot

Duct, pole sharing plan 'hampered' by BT

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Telcos are walking away from the government's £530m Broadband Delivery UK (BDUK) project with one ISP citing, among other things, "uncertainties" around incumbent BT's restrictive physical infrastructure access (PIA) pricing plans as the reason for withdrawal.

Geo Networks boss Chris Smedley said in a cutting blog post on the outfit's website yesterday that BT's duct and pole sharing product was too restrictive.

"Whilst pricing may have reduced for the current PIA product (still not far enough in our view), the real issue is that it can only be used for providing the final drop from local exchange to a residential broadband consumer’s house," explained Smedley.

"PIA cannot be used for the far more costly task of crossing the long distances in rural areas to get to these remote communities (backhaul) – making the idea of being able to build new fibre connections within them faintly ludicrous.

"It cannot be used to connect mobile or wireless infrastructure (a critical way of quickly rolling out competitive services in hard to reach geographies) and it cannot be used to provide leased lines to businesses. Quite simply, our business case does not stack up because of these restrictions," he added.

Geo is the operator behind the laying of next generation fibre in North Wales. But yesterday's announcement means the company will no longer bid for such procurements including the BDUK Framework.

It claimed BT was not subject to the same "restrictions" that are placed on the national telco's rivals when it comes to rolling out optical fibre cable atop its existing infrastructure. "Only BT can deploy fibre for backhauling traffic long distances from local exchanges for itself and the wholesale ISP market," grumbled Smedley.

"Only BT can build a business case including the revenues from the fast growing mobile and wireless data market. Only BT can deploy services for businesses over this fibre."

He added that the current "inadequacies" with the PIA product were proving "fatal" to competition in the market.

PIA becomes a PITA

Ofcom, which had not responded to a request for comment at time of writing, has previously stated that it wants BT rivals to bid for BDUK funds from local authorities. That's a move that in part helped the regulator convince BT to drive its PIA prices down last month.

But it would seem that some companies aren't happy with the current state of play regarding BDUK. Smedley wants to see BT offer a "truly open dark fibre product" to its competitors.

BT gave us this catty response to Geo's withdrawal: “Geo’s departure is disappointing but hardly a surprise given fibre deployment requires a high degree of commitment and expertise. It is ironic that Geo are trying to blame BT, Ofcom and BDUK for their withdrawal at the same time that the major players are making such good progress.”

Meanwhile, The Register understands that Cable & Wireless Worldwide has also withdrawn from bidding for BDUK funds.

A spokeswoman at the company said there was no comment to make, however, she failed to deny that CWW had indeed walked away from bidding for the government cash.

Just yesterday, BT – clearly keen to calm the market's nerves – put out an optimistic press release in which it applauded the progress it was making with Fujitsu. Openreach boss Liv Garfield claimed the company had received "positive feedback" about its PIA products from would-be wholesale customers.

But Fujitsu – the first firm to test fibre-to-the-premises technology deployed using Openreach's PIA – said yesterday that it was still ironing out "points of detail" with BT. The national telco claimed those discussions involved "minor operational" matters.

In a statement to El Reg late on Wednesday, Fujitsu revealed that there's a little more to it than that.

"The points of detail relate to making the Openreach products scaleable," said a spokesman at the Japanese tech giant. "So the discussions over the next months will be around commercial considerations."

Which to Vulture Central sounds an awful lot like the problems Geo had with BT's pole and duct sharing products. ®

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