Print

Please login or register.
1 Hour 1 Day 1 Week 1 Month Forever
Login with username, password and session length

[tickmike]

Interesting items .

http://www.pcpro.co.uk/news/interviews/376357/lighting-up-dark-fibre-could-improve-uk-broadband

http://www.pcpro.co.uk/news/broadband/375832/will-eu-force-bt-to-light-up-dark-fibre

[kitz]

Hmmmm.   

Not sure...  afterall BT is a business and if they have gone to the expense of laying the fibre why should they be forced to open up any they currently dont use to rivals.  Dark fibre is usually there for future needs, with the advances in speed and future advances due it makes good practice when laying fibre to install more than you currently need. 

In my mind its foresight for the future..  kind of like if you buy 2 tins of beans from the store...  then someone says "Your neighbour hasnt been to the shops this week, therefore you have to give them your extra tin that you havent opened yet".  Actually no thats not a good analogy because its not a neighbour, its someone who is trying to outdo you and make a profit on the tin of beans.

My real concern is that BT is one of the few UK companies that is still doing ok and EU legislations such as this could tip the balance at some point.   I have no objections if they want to rent some of it fair enough.     I dont see how its holding the UK back. Other companies will just grab more... and those other companies havent brought anything new to the table so far..  they just cherry pick the best locations, leaving BT about the only company who is mopping up the more remote and less profitable areas.   

Whilst we all moan about some of the things that BT do (or dont do), like it or not, they are about the best at what they do.  Its steps like this which could actually damage BT business plans.   What happens if in a couple of years time when more areas are covered by FTTC/FTTP and faster services..  and BT needs to light some of that fibre themselves for their own backhaul or Core.

Companies like TT & Sky already have more consumers than BT, so how about they do some of their investing in the infrastructure.   How would Sky like it if they were made to open up their satellite to other rivals...  all Sky does is mop up until they become the bigboy... then rocket their prices 'sky high'. 

---
PS There are other specialist dark fibre providers that can be approached if they really are that interested anyhow in setting up their own network.   

[tickmike]

Re "PS There are other specialist dark fibre providers that can be approached if they really are that interested anyhow in setting up their own network."
I'm still in the process of looking into doing a 'B4RN' project around our village but I cannot find any None BT 'Dark' fibre, there is a fibre run two miles from the village but it seems to have No spare dark fibre's     I'm still contacting other providers.
Our exchange has now gone live for fibre but cannot find any details of it coming to us at 3.4kl away.

[kitz]

Unfortunately with the remote areas where there is no fibre, this act wouldnt help cases like yours anyway.
BT do (and always have) subsidised provision of the more expensive location from areas where its cheaper to lay.  Unlike other telco's dont have as much coverage, they prefer to go cheap mass-market and not bother with unprofitable areas. 

What really concerns me about this act, is that by enforcing BT to open up dark cable to other SPs it could actually damage BTs plans for the future.  With capacity requirements approximately doubling every year dark fibre is usually there for a reason.  Theres nothing stopping anyone leasing (BT) fibre where BT judge they have surplus.  All I feel that this act would achieve is an option for the likes of Sky to cherry-pick...  leaving BT to pick up the tab.  What happens if they have to give that surplus and the next year the BT network needs more capacity.   
Then either the BT network suffers, or BT has to fork out and lay more cable...  at which point some of that cable immediately is unused - so Sky then grab it again.

See the problem?   It could actually have a knock on effect of BT then not bothering to connect up the less profitable and remote areas.   

BT is reluctant to provide dark fibre for the simple reason that it cannibalises its Ethernet and leased line offerings. BT has been very persuasive in convincing Ofcom that its point of view is valid, saying that its business case would be severely damaged if it was compelled to offer dark fibre.

I sincerely imagine the above statement to be true. This is one ruling that could be bad for BT and the future of UK broadband.

[AndyPPUK]

How would Sky like it if they were made to open up their satellite to other rivals...

Actually, Sky are4 perfectly happy to share the same satellites as their rival UK Freesat, and loads of other national rivals wound the world. Sky don't even own the satellites, they just buy bandwidth from the Astra network, owned by the massively successful but rarely heard of company SES (Société Européenne des Satellites).

SES is the perfect example of how BT could have ended up with a bit more vision. It has it's origins in the tiny Luxembourg equivalent of BT but ended up being gatekeepers for pretty much the whole world's satellite TV systems, and earning the Luxembourg government (who kept a large shareholding) an absolute fortune.

[ColinS]

SES is the perfect example of how BT could have ended up with a bit more vision.

Surely you mean if the (successive) Governments of the UK had had more vision? A more comparable analogy then would be if SES were asked to give its spare satellite capacity to other competitor satellite operators?  I wonder what the Luxembourg Government would think of that suggestion?

[AndyPPUK]

SES is the perfect example of how BT could have ended up with a bit more vision.

Surely you mean if the (successive) Governments of the UK had had more vision?

That is exactly what I meant, sorry for not making it clearer!

[AndyPPUK]

Hmmmm.   

Not sure...  afterall BT is a business and if they have gone to the expense of laying the fibre why should they be forced to open up any they currently dont use to rivals.  Dark fibre is usually there for future needs, with the advances in speed and future advances due it makes good practice when laying fibre to install more than you currently need.

From what I understand, speed advances in fibre optics tend to come from technology that increases the bandwidth of existing fibre, and that increase is outpacing the increase in demand. I could be wrong on that though.

From a regulatory point of view, there are some really interesting questions: BT is in an odd, possibly unique position because it's not just a monopoly, it's two monopolies split by a Chinese wall. I'm not sure it's actually a very helpful to try and find parallels, but we have a number of these situations where there are splits between infrastructure and customer-facing halves of the same thing: Railtrack and the various franchises, National Grid and the electricity supply companies, or even the Highways Agency and motorists.

From a purely capitalist point of view, dark cable seems to exist because of a market failure, it *ought* to always make financial sense to light it. Maybe we have a problem with pricing by data transference, not just capacity - does it really cost money to send and receive data once the infrastructure is in place, or is the only appreciable cost in set up? If so why does data transfer need to be measured at all? Shouldn't we be selling based on capacity and transit times?

... they just cherry pick the best locations, leaving BT about the only company who is mopping up the more remote and less profitable areas. 

My turn to say Hmmmm.

BT is fiercely defensive of the less profitable areas, because it wants a monopoly on lucrative subsidies from BDUK and it's successors. It fought tooth and nail to stop Fujitsu and others from mopping up any 'less profitable' areas, probably because they are actually the most profitable areas once you get the government to pay over the odds.

There's a really odd monopoly effect here that the government seems not to have factored in: BT has mopped up 100% of the BDUK money, and looks like it will do the same with the next rounds for the UK 2017 and EU 2020 targets. It's doing this on a 'we invoice for the work we do' basis, which looks sensible, until you realise it now makes financial sense for BT to install equipment that it knows will be almost immediately obsolete, then rip it out next round. If there is money to get a village to 2Mbps by 2017 and 30Mpbs by 2020, BT gets paid less if it adopts the rational solution of just installing fibre right away to handle 30Mpbs, and more if it puts in a load of copper to get 2Mbps,  then rips it out again a bit later to put 30Mbps fibre in. If it does it the stupid way it gets paid twice, and keeps the copper salvage. This is a big market failure!

I think an ideal solution would be to admit there's a natural monopoly for fibre management, split BT and Openreach into the two companies they really are, and set up an arbitrage system under Openreach that allows anyone to buy and sell capacity (not data transfer!)... but I'm open to counter-proposals.

[kitz]

Apologies regarding Sky opening the satellite network - its not something I really follow these days..  I jacked in satellite years ago, originally bought when there where several competitors.  Sky undercut and within a short time they became the monopoly.  As soon as they were the only provider prices went up astronomically - doubled in a short period of time and also introduced the pay extra for sports which were previously included.  In just a few years £6.99 package became nearer £20.
----

Maybe we have a problem with pricing by data transference, not just capacity - does it really cost money to send and receive data once the infrastructure is in place, or is the only appreciable cost in set up? If so why does data transfer need to be measured at all? Shouldn't we be selling based on capacity and transit times?

Broadband used to be sold on speed.  But Ofcoms - OFTEL back then - MST (Margin Squeeze Test) and CBC (Capacity Based Charging) changed all that.  The idea of this was to provide cheaper broadband. UBC (Useage based charging) was another option..  but generally speaking it was too expensive for most ISPs and CBC became the norm.

CBC basically meant that the providers worked out their costs based on the size of their 'pipes segments'.   Broadband is and always has been a contended product.. its why its cheaper than a leased line.   
During the early days of DSL contention could be a nightmare for many as the backhauls clogged up and at peak times speeds could be pitiful.   It only took a few leechers to bring the VP to a crawl and speeds worse than dial werent that unusual.   

Even today with more fibre the BTw based ISPs such as PN, Zen, IDnet still have to base their costs on the CBC model.

CBC meant cheaper adsl  £30 - £40 pm for 512kbps became a heck of a lot cheaper practically overnight.   The downside was that it meant the introductions of caps/fups/limits/traffic shaping.  The ISPs were hesitant of lighting unused pipes until they reached a certain level of consumers.

Be*Broadband were one of the first LLU providers to move away from this model and offer a truely unlimited package, but even they would on occasion have congestion issues, and if you search hard enough even they have kicked a couple of heavies off their network.

Perhaps we should move back to a speedbased pricing, in fact we are on the way with FTTC and BToR charging different rates for the different products.  The ISPs such as Zen though still have to cost their pricing for backhaul costs based on the CBC model.

It fought tooth and nail to stop Fujitsu and others from mopping up any 'less profitable' areas

I wasnt aware of this, I thought Fujitsu pulled out on their own accord, and many others didnt meet the gov criteria. (1. 2.)

You can hardly blame BT for bidding for BDUK funds, if they know at some point in the future that they would likely cover that area.  It just serves to bring the date closer.  Why didnt some of the other LLU/Telco providers get involved in this?

and more if it puts in a load of copper to get 2Mbps,

Is this what they are doing..  I thought it was FTTC/FTTP

How much is BDUK actually costing the country, not just what is paid to BT, but all the setup costs, the bidding process, the paperwork, gov & council costs & manpower.    Makes you wonder if it would have just been cheaper to let someone just get on with it.  Make it government owned.  But then again what do we have left that is government owned these days

Im certainly not against the likes of B4RN they do a damn good job and should be thoroughly proud of what they have achieved.  But you are correct in that there is a natural monopoly when it comes to things like this.   I just feel sad that public funds will have been wasted during the whole BDUK process, when its quite clear that it probably would become a one horse race :/

[AndyPPUK]

In reply to Kitz (I didn't do quotes as I think this reply will be more coherent if I tackle things in a different order).

The question of moving away from a data pricing model to a bandwidth pricing model seems to be a bit of an elephant in the room. Given that taxpayers are funding infrastructure, I think we should be looking at how to incentivise providers (not just BT, but anyone) to deal with bottlenecks, but at the moment we are pretty much incentivising them to build in bottlenecks which we will have to fund them to fix later. It strikes me that changing the pricing model would not only reflect the actual costs better but also achieve a better set on incentives.

Consider the hypothetical village I mentioned before, When BT come back with fibre to meet the 2020 target of £30Mbps for all and 100Mbps for 50%, they could technically achieve this by running a single 100Mbps line into the village. In reality they would put in a lot more, but not necessarily anywhere near enough for the village to (for example) all watch their local premiership football team through BT Sport at the same time. If they build in enough contention, they are likely to get funding again to put better backhaul in, which they wouldn't get if they did it right first time. It's the same process - why do it right first time when we can get paid twice, once to do it wrong and once more to do it right? This is why I think we need to ensure that future roll-outs are structured to avoid this behavior.

I don't blame BT for this (nor do I blame them for bidding for the money, if fact quite the opposite, I think BT should have been handed the money and told to get on with it years ago, hammering out 44 different (but ideally identical) deals strikes me as a huge waste of everyone's time and money). I do blame BDUK for structuring things in such a way that BT is incentivised to do things in ways that are unhelpful, and I also will blame councils if they didn't use their discretion to vary the deal to insist that BT behaved in our best interests, not theirs.

While Fujitsu decided to pull out of their own accord, the reason they pulled out is pretty obvious: The requirements were written in such away that BT would win every time, unless another company was prepared to soak up a huge loss getting up to speed. Doing that wouldn't make financial sense if you only ended up with one or two of the 44 regions, or if you won 10 but they were scattered wildly round the country.

How the invitations to tender came to be written that way is a matter of speculation, but if I was BT, I would have lobbied long and hard, and thrown my weight around by threatening not to bid in order to get the government to specify things that only BT could deliver, as that's the easiest and cheapest way of winning. I'm in complete agreement that what we've ended up with (the illusion of competition) is the worst way to do this, and we need to either have real competition or just admit that it's a one horse race for the 2017, 2020 and subsequent rounds of government funding.

BDUK are funding 2 (almost contradictory) things. 30Mbps to 90/95% of the UK, and 2Mbps to the rest. I don't (yet!) have any evidence that BT are actually are putting in copper with BDUK funding, but absurdly, it's actually written into the rules that councils CANNOT specify FTTC/FTTP, they HAVE to let the supplier put in whatever technology the supplier chooses. BT would make less profit if they went straight to fibre this time than if they put in short term copper solutions that they will be paid to rip out a few years later for the 2020 target, so they would be silly not to.

I've got a meeting booked with "Faster Broadband for Worcestershire" on Tuesday, where I'll be trying to get some more insight into the bidding process, and get more of a handle on what's going wrong, and what our money has been spent on.
 
On the (slightly off-topic) subject of satellite, if you've had Sky in the past, it's worth taking a look at freesat next time you upgrade your freeview box. It hooks up to yours old sky dish and gets a lot more channels (and more HD channels), because the bandwidth bought by the BBC/ITV and the rest from the Astra network is much greater than the bandwidth available for digital terrestrial broadcasts. It's probably not worth doing if you don't have a dish and wires already, as all that would have to be installed, but if you do it's a good deal!