Could London match Singapore with unsubsidised fibre to the flat?

Singapore and Hongkong are London’s most dangerous global financial services rivals and also have the best big city broadband. What do we and they they have in common? The high proportion of residents who live and work in housing and office complexes which are cheap to fibre up – provided this is done in co-operation with residents and building managers.

Why did London not copy Seoul when it led the way with affordable fibre to every apartment in every social housing tower?  The prime reason appears to that “pure” fibre customers commonly pay less for broadband including Internet telephony, that those without fibre pay for a traditional telephone service, even without broadband. It was, therefore not in BT’s interest to co-operate with such a revenue destroying “opportunity”, even if it could afford the cost of change at the same time as building a TV business and (now) buying EE, unless its content revenues more than make up the difference. Hence the current “Quad Play” fight to the death with massive discounts for new customers (on the assumption that existing customers will be loath to risk the disruption of change – unless actively driven away by poor service}.  

I have blogged in the past on why BT’s competitors can build rural broadband networks at a fraction of its costs. The local contractors who installed shared aerial systems to inner city tower block estates during the digital switch-over in the run up to the Olympics are similarly capable of installing fibre to social housing complexes for significantly less than it costs BT to replace aluminum exchange-only lines by Gfast quality copper. Meanwhile competition between Alcatel Lucent, CISCO, Ericsson, Huawei and others has caused relevant equipment cost to come down by around two thirds over the past year. Some of the competitors to BT can therefore get payback inside two to three years, as opposed to the twenty or more years quoted by “establishment” (using Richard Hooper’s excellent definition which I unfairly summarised in a blog on the USO) analysts.

The actions necessary to permit them, particularly the streamlined agreement of shared wayleaves, would also enable BT to cut its costs, while upgrading its networks (architecture as well as technology and cabling) to provide more profitable backhaul for the mushrooming traffic volumes (fixed, mobile, wifi, lifi and m2m) that a smarter, greener city will generate. I would add that Gfast may been overhyped, but it is a seriously competitive technology (at least for a decade or so) for housing complexes and office blocks with under 50 units and good quality copper wiring. 

As a Londoner, I would argue that the City Corporation and the London Boroughs should work together to allow market forces to work before London haemorrhages jobs and tax revenues migrate to smarter, greener, less polluted cities where bandwidth-hungry businesses can get symmetric gigabit, “full fibre” connections to homes and offices, leading to more home-based working and less travel stress and pollution. A modern reliable and resilient IPV6 compliant mesh will also enable London to make effective use of intelligent devices and systems, from energy and traffic management to the health and welfare monitoring that enables independent living instead of bed-blocking our clogged NHS hospitals.

The forthcoming Mayoral election will provide an opportunity to argue how this could and should be achieved and readers will not be surprised to know that I am happy to make proposals to anyone who will listen. However, we do not need to wait for the result of the mayoral election to make serious progress.  and I am delighted that Hyperoptic has agreed to support me in a modest exercise to try to collect and publicise case studies of how broadband has already been brought to some of the social housing complexes whose votes will determine the outcome of the mayoral election.

I ask therefore ask readers to comment on the synopsis that follows and suggest case studies that will support or destroy the thinking behind it

Background

There is growing political concern at the deepening (if not necessarily widening) of geographic, social and economic digital divides within the UK. Those in most need of on-line services (from home shopping and security to monitoring and telecare services) often have least access to what the Prime Minister has described as an essential utility. There is confusion among public sector decision-takers as to how best to address the consequences at a time when their budgets are under increasing pressure 

Many of those in most need live in 40 – 50 year old social housing complexes. Some of these are run by Local Authorities. Others are run by Housing Associations.  Even where tenants have exercised rights to purchase, the buildings may still be managed by Local Authorities, Housing Associations or their agents.  Korea’s success in becoming the world’s most connected nation is said to be in large part because half the population lives in similar complexes. The main reason the UK has not followed suite appears because copper/aluminum wiring was installed when the complexes were built and carries traditional telephone services which generate more revenue for the incumbent telco than VOIP over broadband. This removes the incentive to invest, unless and until it is needed for content services that generate additional revenue (e.g. subscription TV channels) and/or it is threatened by competition that can make money from providing better services at significantly lower costs over new networks using different technologies and architectures.    

BT is therefore seeking to offer broadband over the existing telephone networks but is limited by the quality of the wiring within buildings as much as the need to upgrade the services to them. In parallel a growing number of organisations are seeking to provide low cost monitoring and care services over mobile networks which do not always work well within inner city estates: mounting problems of overload and interference.  Many buildings will therefore need recabling, unless there is the opportunity to piggyback on more recent investments, such as the communal aerials installed during the run up to the Olympics or electricity cabling capable of carrying powerline services.  Over recent years housing associations and council housing departments have therefore begun working with partners to refrofit fibre networks akin to those included in new build private sector apartment complexes. 

The good news is that the cost of  fibre and both landline and radio is falling dramatically and a variety of technologies and business models could be used to provide reliable access at well above the universal service obligation on which the Prime Minister has announced a consultation starting in January.

The question is therefore “How can Local Authorities best work together with suppliers to ensure these are used to meet the needs of those for whom they are responsible at a time when they too must make massive savings in the cost of service delivery?”

The start point for the answers is to look at what has been done already.

Case Studies (covering different technology start points and solutions, business models, benefits)
 
1) Technologies and technical issues:
•    Traditional (copper/aluminium) wiring  – Exchange Only, FTTC, GFast 
•    Community aerials and/or “rediffusion” networks – coax and fibre
•    Powerline, Fixed Radio, Mobile/Wifi
•    Fibre (P2P, GPon)
•    Backhaul issues
 
2) Business Models and viability issues:
•    Capital Funding:  public or privately owned or leased (including PFI et al deals), community/co-operative, revenue sharing etc.   
•    Operational Funding: Included in rent, separately charged (to tenant, social services etc.), utility service (e.g. basic broadband/telephony with choice of upgrades and content services), bundled (e.g. including TV and other content), building services and/or revenue share for building owners/operators.
•    Access and wayleave arrangements and charges: one-off/standard, exclusive/shared, responsibility and liability arrangements.
•    Other issues:  e.g. security, privacy, interference (both accidental and criminal: e.g. were/are drug and rave related tower-block pirate radio complexes a significant issue).    

3) Quality of service, including performance measures and monitoring
•    Disruption (on installation or during maintenance/upgrades),
•    Speed,
•    Reliability,
•    Response time,
•    Problem handling 
•    Customer satisfaction

Choices, Trade-Offs and Decision Criteria)
To be collated, distilled and summarised from case studies

Possible Conclusions (hypotheses to be tested in the course of collecting case studies  
Horses for courses

1)    Technology choices and criteria
? A Gfast box on the outside of small blocks (up to 48 units) with good copper telephone wiring
? Powerline to small blocks with poor telephone but good power supply wiring
? Piggy back on good coax-fibre community aerial networks
? Full fibre to the rest (but “future proof” P2P in risers, or low cost GPON pinned to the outside?)
 
2)    Business Model
? Affordability and predictability of cost to the tenant should come first not last.
? Models based on revenue share from sales of content and/or upgrades that are essential for usability should not be at the expense of those in most need.
? Cutting the cost, delay and uncertainty imposed of private sector partners gets a better deal for all  

Nest steps

Co-operation (? via GLA, LGA, SOCITM, other channels) on detailed guidance and/or shared projects and/or negotiation and/or lobbying  and/or education/awareness (of whom: suppliers, councilors, tenants, public …)
 

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