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BT slurps from first govt broadband cash pot in Lancs deal

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The first round of the government's public broadband funding has been awarded to Lancashire County Council, after the local authority agreed to a £62.5m project with national telco BT.

It's early days in the bid for BDUK investment, but BT is the only one to have secured such a contract. Many other ISPs have pulled out of bidding for the cash altogether, with only Fujitsu understood to remain in the running for any funds at all. Fujitsu also withdrew from the race for BDUK funds in Wales earlier this year, leaving BT as the sole bidder.

The BDUK pot had stood at £530m, but was topped up by the Chancellor in his Budget statement late last month to £680m to help speed up broadband connections in 20 cities throughout the UK.

The government also hopes to add a further £300m to that cash pile that it plans to take directly from the BBC's TV licence, but that won't happen until the next Parliament in 2015.

BT estimated that the total amount of money that will be invested into broadband rollout for Lancashire County Council would be around the £130m mark.

At present, Ofcom figures suggest that around 15 per cent of homes and businesses in Lancashire receive downstream speeds of less than 2Mbit/s.

BT is flinging £30m at the rollout project, while the local authority will get £10.8m from the BDUK funds.

A further yet-to-be-confirmed £16.5m is expected to be allocated from the European Regional Development Fund and £5.2m will be divvied up from local councils in the area – Lancashire County Council has to cough up £4.7m of that.

The council didn't go through the BDUK national framework to bag the funds, so it is instead required to seek its own state aid approval.

Additionally, the council created a £500,000 community fund to help pipe superfast broadband to more remote homes and businesses in the area. A pilot will kickoff in the east of Lancashire, BT said.

Unsurprisingly, most of the fibre will be fed to the cabinet (FTTC) rather than to the premises (FTTP).

"Fibre to the cabinet will be the prevalent technology deployed under the project. This will deliver download speeds of up to 80Mbps and upload speeds of up to 20Mbps. The average download speed in Lancashire is currently around 7Mbps," said BT.

Some parts of Lancashire will also eventually gain access to broadband speeds of up to 300Mbit/s, the national telco promised. ®

Updated to add

Regarding the Lancashire deal, a BT spokesman got in touch to say: "BT fought off several rival bidders to win these funds and so it was an open competitive process."

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