BT, the UK's big incumbent telco is always rabbiting on about how much it relishes competition. Well, now it's going to face some more as Fujitsu reveals plans to deliver 1 Gbit/s "superfast" FTTH broadband to five million premises, commercial and domestic, across rural parts of Britain. Martyn Warwick reports.
Fujitsu says it will work in partnership with with Virgin Media, Talk Talk and Cisco Systems to deliver an fibre optic-based alternative fast Internet access service to that provided (or not provided as the case may be) by BT's Openreach division and describes the initiative as "groundbreaking and innovative".
Fujitsu says it will provide fast broadband to rural communities that BT will be ignoring. In a statement Fujitsu adds, “The proposals will provide future-proofed connectivity to five million households and beyond that would otherwise be unlikely to benefit from commercial investment in next generation digital networks."
To help finance the proposed new network the new consortium is looking to secure some £500 million of the £530 million the UK government has set aside to help finance rural broadband. When built, the Fujitsu network will be available to competitive service providers on wholesale terms.
Fujitsu is also relying mightily on Ofcom's regulatory decision, taken back in March 2010, that BT Openreach must provide competitors with access to various parts of its infrastructure, including ducts and poles, on "fair, reasonable and non-discriminatory" terms.
The Japanese company says that if it gets the go-ahead it will connect its first retail customer in 2012 and "should" hit its projected target of reaching five million new rural subscribers by between 2015 and 2017.
The Fujitsu announcement comes at an interesting time.
In recent weeks and months BT's rivals have been complaining that it is deliberately ramping-up its access prices in an effort to stop competition in its tracks, indeed, earlier this month, Virgin Media, in an open letter to BT and the UK regulator, said that because of BT's machinations it would actually be more economical to build a completely separate network of ducts and telephone poles in rural areas than to pay the inflated prices being demanded by the incumbent. BT says it hasn't finalised its new access pricing structure for competitors yet but "hopes' to have it in place by "the summer."
This delay and obstacle setting, if it continues, is likely to spur BT's competitors to go back to Ofcom with complaints and demands for speedy regulation to solve the problem.
For its part, BT points out that it is spending £2.5 billion on its new fibre broadband network and says, "It is important that the companies concerned make it clear that they are willing to invest material sums rather than just spend public money in what could be a multi-billion project."
It continues, "BT's network is open to others on an equal and non-discriminatory basis and whilst it is encouraging that Fujitsu and the other companies are making welcome pledges, they do need to be clear that this will be on an open the same equal access basis to which BT is committed."
The target is for BT's new network to be operational by 2015 but even then it will not reach all of the country. Some 33 per cent of remote rural areas are not included in the plan because BT adjudges them not to be economically viable.
Regardless of the participation of Cisco, Virgin Media and Talk Talk in the consortium, the leading technology member, Fujitsu is hardly Number One Best Pal of the UK government since it ducked-out of a troubled, indeed disastrous and disastrously expensive National Health Service contact at the eleventh hour leaving the programme in disarray and minister with egg on their faces.
It's going to have to do some serious brown-nosing if it wants to get back in the government's good books.
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