In the UK at BT there is a crazy 5 year project, which incidentally staff and unions within BT completely don’t believe in, to make its entire network from end to end, an IP network. It has already been going on for four years, but the end result is still five years away and will probably remain five years away in five years time. The cost cited in 2005 was £10 billion, which back then was $19 billion, but already this has fallen to $15 billion on exchange changes, and roll-out has finally begun in earnest.
However the new BT management has put out an elongated roll-out plan and UK analyst group Point Topic has analyzed this against the broadband lines that will become available as a result of the deployment. It makes for fairly depressing reading if you are either BT or one if its investors, or part of another operator considering the same move. Don’t get us wrong, we’re all in favor of all IP networks, but the transition is going to be tough, and being a pioneer is unlikely to help a struggling incumbent, especially one which does not have a hugely profitable cellular network to fall back on.
The latest analysis from Point Topic is taken from Version 10 of the project database for what BT calls the 21st Century Network (is it called that because it will take the entire century to build it?) and contains information complete to June 2009. It reveals how the demand for broadband is spread, maps the phases of BT’s next generation access deployment and places the projects so far announced by alternative network operators (altnets).
The map below shows where BT and the altnets are planning to roll out NGA (Next Generation Access), in red and pink, and where the demand for broadband is concentrated, shading from green (high) to white (low).
‘The current plans won’t even cover half of the areas of high demand,’ Tim Johnson of Point Topic points out.
Point Topic estimates that the deployment announced so far by BT will reach about 35% of the population by 2012, 7 years after the start of the project. Consumers can expect to get about 40 megabits per second (Mbps) downstream bandwidth if they are in a fiber-to-the-street-cabinet area and 100Mbps or more where they are lucky enough to get fiber all the way to their home.
By defining and mapping the density of broadband demand across the UK, the research shows where NGA is likely to be available on a purely commercial basis, and where subsidies and other special measures will be required.
BT’s planned NGA rollout, as so far announced, falls a long way short of covering even those areas where NGA should be economically attractive even without subsidy. The contribution from altnets looks quite limited at the moment as well. The end result is that 7 years into the project 60% of the UK population have no prospect of getting NGA.
Point Topic believes that this new digital divide will cause heated controversy as many customers discover they cannot get the new high-speed services which neighbors enjoy. As NGA services develop ‘ high-quality video communication, immersive online games, simultaneous broadband access for multiple home users ‘ the gap will seem increasingly unacceptable.
There is already a deep political divide over whether cross-subsidies should be used to support NGA rollout in less financially attractive areas. If market forces fail to meet the need, the public demand for some kind of state intervention, on the lines suggested in the Government’s Digital Britain report, will become very strong.