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Jocks' USO block shock: BT's 10Mbps proposals risk 'rural monopoly'

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Not a problem

Instead of whining that this would entrench BT's position, just accept it, and deal with it like other monopolies - effective regulation. I can see that they might be underwhelmed by Ofcom, but the answer to that (absent any progress by the slugs of DCLG) is to have their own tame Scottish regulator, Scofcom, I assume.

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Re: Not a problem

Great idea, except that they can't regulate because telecoms is an area that is reserved to the Westminster parliament.

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Re: Not a problem

telecoms is an area that is reserved to the Westminster parliament

Doesn't have to stay that way. Water regulation is already different on either side of the border. Scotland has its own environmental regulator. Some energy policy is now devolved, even though there's a single GB regulator, charity and housing regulation is separate, I daresay there's others if you look. And as working example, Norniron do their own thing in most areas of regulation.

With May down to a coalition majority of one seat in the Commons, a modest amount of political horse trading could deliver quite a lot to anybody so minded. I suspect, though, that the SNP don't really have a scooby about what they'd do with telecoms (other than a nascent desire to renationalise everything), and this moaning is largely opportunist moaning from the comfortable position of having neither a better alternative, nor any actual responsibility.

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Re: Not a problem

Doesn't have to stay that way. Water regulation is already different on either side of the border. Scotland has its own environmental regulator. Some energy policy is now devolved, even though there's a single GB regulator, charity and housing regulation is separate, I daresay there's others if you look.

I suggest having a separate regulator would have "unintended consequences". With a single BT and a single regulator there is no problem sharing the cost of providing services across the whole of the UK, so that "easy to provide areas" can subsidise the harder more expensive areas. If the regulatory function was split a Scottish regulator could not legitimately mandate that a service provider (in this case BT) subsidise provision in Scotland from English income; what BT did with its income south of the border would be outside a Scottish regulator's remit.

The remit of any Regulator set up by the Scottish Government stops abruptly at Hadrian's Wall.

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Re: Not a problem

Do you know that Hadrian's Wall is in England - up to 90 miles in places - perhaps you can explain why a Scottish Government would regulate anything in England, or indeed people in Northumberland would want regulated by a Scottish Ofcom

Best you go and read up on UK geography, then turn your attention to what's devolved to the Scottish Parliament and the Welsh and Northern Irish assemblies - then look an see how to actually increase any of the devolved governments powers

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Holmes

So...

A company willing to spend £600m in order to avoid regulation has ulterior motives ?

See icon...

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Re: So...

I'm not sure if they are trying to avoid regulation, but they certainly have ulterior motives...

Just what was Ofcom hoping to achieve with the 10Mbps USO?

Once Ofcom put a 10Mbps USO in place, they cannot deny BT/Openreach investing (they say £600m) in their network to satisfy the USO, given only BT/Openreach have a USO!

So what BT have done is to put the ball squarely into Ofcom's side of the court. Ofcom cannot deny BT's request that will further entrench it's monopoly in the local loop and then impose a 10Mbps USO. Likewise if Ofcom accept BT's offer, we can expect many to complain that it undermines a competition that is largely a figment of their imagination.

From a public interest viewpoint the only option is for Ofcom to: accept BT's offer, introduce the 10Mbps USO, impose some conditions such that BT works with alt-ISP's (ie. build on infrastructure funded out of the BDUK project) and turn a deaf ear to those who want competition at any cost, even if it means more decades of poor service to consumers.

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Anonymous Coward

Those who do not learn from history...

But Scotland's Rural Economy Secretary, Fergus Ewing, said the proposals risk undermining competition by "apparently concluding that it will not be commercially viable for any provider other than BT to deliver in white areas".

Where have I heard these kinds of words before, I wonder?

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FAIL

Well..

...all they need to do is find someone else willing to spend that much money on little return

Good Luck

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Facepalm

Re: Well..

And I'm sure that any company that is willing to put that kind of investment in (maybe Verizon or Comcast?) will be really friendly and will do it's best to offer a good service at a fair price, right? Right?

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Anonymous Coward

Blinkered politicians...

What does he expect? It will only be economic for other operators to provide rural service if people are willing to spend £2500 connection fee and £150 per month (random figures - just for illustration). No company other than BT can possibly provide rural covverage for £20 or whatever the expected price is, so why not welcome their committment rather than whining about it?

Just accept that as one of the drawbacks to living in a nice rural area - just as you have limited or no choice in supermarkets, petrol stations, banks, restaurants and other services/businesses

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Re: Blinkered politicians...

You need to look at this from the SNPs perspective. Rural farmers are far more likely to vote tory or lib dem than SNP. Stir it up against the current evil-tory government is a good thing for the SNP.

It's win-win because if the tories got ahead and tell BT to do it the SNP can say the tories are making a monopoly on the poor disadvantaged farmers, whilst themselves doing nothing to help.

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WTF?

Re: Blinkered politicians...

To be fair, I'm not seeing the point here.....

If BT invest their £600m and actual install rural lines, who are they going to actually get to install the lines? are they not going to instruct OpenReach to dig the holes and run the cables? Thereby gifting OpenReach the network that other operators will be able to then resell OpenReach services as they do now just about everywhere else in the UK?

Or do they think that Virgin is suddenly going to stop going after the easy city business.....

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Re: Blinkered politicians...

The vast majority of folk who live in rural Scotland are not farmers, never mind tory or lie-dumb voters.

Rural Scotland includes areas aren't pictured on shortbread tins or look like Brigadoon

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Natzionalism At It's Worst!

The sad thing is that if it was DT (Deutsche Telekom) they would welcome it with open arms. Quite simply they just want to cause conflict with anything that starts with British!

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Re: Natzionalism At It's Worst!

Ah, you're the one that falls for knee-jerk "SNP-bad" press propaganda!

(What sort of a word is Natzionalism anyway, you should be ashamed of yourself)

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Re: Natzionalism At It's Worst!

Well they are not so happy with the fact that Deutsche Bahn, Nederlandse Spoorwegen and SNCF can bid for Scotrail services but Directly Operated Railways can't.

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Re: Natzionalism At It's Worst!

Oh FFS!

You probably think they caused British Home Stores to go under

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@ AC: What does he expect? It will only be economic for other operators to provide rural service if people are willing to spend £2500 connection fee and £150 per month (random figures - just for illustration). No company other than BT can possibly provide rural covverage for £20 or whatever the expected price is, so why not welcome their committment rather than whining about it?

Although it might be a very crude way of looking at it, England has a population of approximately 55 million against Scotland's 5.5 million; these translate into population densities of about 1100 / sq. mile and 175 / sq. mile respectively. Now I know that "numbers of bodies" does not translate directly into "number of broadband lines" but it ought to be bloody obvious that the costs of providing anywhere near 100% coverage in Scotland have to be much greater than the equivalent coverage south of the border. It is thus quite likely that Scottish BB users are already being subsidised by their English counterparts. I wonder how they might feel ("they" being both the Scottish electorate and SNP government) if that subsidy was withdrawn and that they had to stand on their own feet.

While no great fan of monopoly providers of any service, I simply don't see how having more than one provider for rural services could ever be an economic possibility. I suspect that that would continue to be the case even if the major Scottish conurbations were carved up between other providers to provide a wider customer base.

It grieves me as an "expatriot Scot" that the SNP / Scottish government are always on the lookout for ways to complain about governments or businesses south of the border, to the point where even if there is nothing real to complain about they will moan away regardless on some obscure point of principle.

Here is BT saying "yes we'll do it" and the SNP government saying "we don't like that idea" as a knee - jerk response.

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> Here is BT saying "yes we'll do it"

But what are they saying they will do? Or rather, who are "BT"? Both commentators and politicians sem to fail to differentiate between BT and OpenReach, a distinction now made clarer by Ofcom. If it is BT the parent group of OpenReach, making an "offer", then it is right to be cautious about monopoly extension, if that means people can only use BT via the OpenReach infrastructure. But if the offer is from OpenReach, then the way to go can only be regulation of a de facto monopoly, along with a service obligation.

Regarding other (the "English counterparts" in the above post) "subsidising rural services, that is a pretty blinkered view. Apart from misunderstanding issues of common good, one could say that rural people subsidise more urban counterparts when the urbanites come to the rural areas demanding urban-style access, which believe me, they do.

Disclaimer: We live in an area that suffers from poor infrastructure, one of those affected by the way this pans out. BT's offer of 99% may sound good, but that 1% equates to a hang of lot of households left out in the cold. The country, Scotland, England, Wales or UK, whichever way you want to look at it, needs decent infrastructure, which it currently does not have. "The market" has failed to provide except in some, mostly urban, areas; trusting market forces to resolve this is both reckless and doomed to fail again.

By the way, I cant find a definition of this mythical "10Mb/s" requirement. We can get about a 7.5Mb/s connection, but because the rest of the infrastructure is ancient radio links and dry string (this is Scotland - string is designed to work when wet...) we are lucky if our throughput hits 4Mb/s. On some Monday mornings, presumably after some reset, we get better speeds, which implies that the issue in many cases, such as ours, is that BT/OpenReach simply are not bothering to improve old 20CN networks.

They can't be trusted. Regulate them to compliance.

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Anonymous Coward

It grieves me as an "expatriot Scot" ...

But what do you expect? Migrants are always the people with the most ambition and energy because of the high effort and risk that migration involves. In the longer term this means that the go-getters go and get, but the remaining native population tends to become ever more parochial, complacent, risk averse and change resistant (and often xenophobic). As somebody who genetically is an expat Welshman, I see this only too clearly when I visit Wales. The same's true regionally in England. If you compare America to Europe you'll see the same thing, even though genetically most Yanks are directly or indirectly from the same European gene pool. It also partly explains why half of Eastern Europe can move a thousand miles to the UK and find themselves a job, whilst we still have almost a million UK citizens claiming they can't find work and need to rely on the state, with notable unemployment black spots in both Wales and Scotland.

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The majority of Scotland's population lives within about 15km of the M8, so the urban population in Scotland is actually higher than in the UK as a whole - 82.7% for Scotland vs 81.5% for the UK as a whole. Another 11% are "accessible rural" and 6.3% remote rural. Would wiring up these remote rural households be any more expensive in the Highlands than in the Lake District?

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They can't be trusted. Regulate them to compliance.

That could work, but even with specific targets and regulation, the money has to come from somewhere. Where do you suggest a ballpark figure of £2bn for providing universal high speed broadband in Scotland would come from?

That's about £770 per working adult in Scotland (or about £3,900 per working adult in the rural areas that presumably would benefit). Mind you, there's 120,000 unemployed Scots, I've an idea that could use every last one of them....

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Anonymous Coward

Would wiring up these remote rural households be any more expensive in the Highlands than in the Lake District?,

Look at a map, and I think the answer is a very clear yes. Rural Scotland is what, 70,000 square km,. the Lake District 2,500 sq km, and is bounded by relatively well served towns and establishments, so that there's virtually no part of the Lake District more than about twelve miles from an existing high speed infrastructure, or one that could be easily upgraded to high speed.

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Look at a map, and I think the answer is a very clear yes. Rural Scotland is what, 70,000 square km,. the Lake District 2,500 sq km, and is bounded by relatively well served towns and establishments, so that there's virtually no part of the Lake District more than about twelve miles from an existing high speed infrastructure, or one that could be easily upgraded to high speed.

I cannot comment on the accuracy of the respective areas quoted but what I can say with certainty is that at least parts of the Lake District have had FTTC for a couple of years or so. Ditto at least parts of Northumbria, which once you get clear of Newcastle can be a pretty remote place, albeit perhaps not on the scale that parts of Scotland are remote.

IIRC some of the money to provide FTTC in these areas came from local authorities; I wonder if Scottish L/As offered to put any money into the pot to provide services there, or did they sit back and wait for someone else to pay up.

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I wonder if Scottish L/As offered to put any money into the pot to provide services there, or did they sit back and wait for someone else to pay up.

A quick search will turn up a House of Commons library paper on the roll out of high speed broadband, and that lists who's put in what, but ICBA to read it on your behalf.

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Part of the fear expressed by Fergus is that if BT deliver 10Mb, then they will deliver just that, but that will be it for the next 10 years, with no further infrastructure investment to develop as in other areas. As a Scottish rural (but by no means remote) dweller (and full disclosure not a Tory) I appreciate this point. At the moment I pay BT (because of no competition on an EO line) nearly £500 per annum for sub 3Mb service (and 150Kb up), so not exactly getting anything comparable to properly connected areas. Oh and no usable mobile data service either...

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@commswonk

"it ought to be bloody obvious that the costs of providing anywhere near 100% coverage in Scotland have to be much greater than the equivalent coverage south of the border"

Really? Is that how you think things work in general? Have you done an analysis of how many Scots live in the five big cities versus those that are rural? Or how many live in completely isolated properties?

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>At the moment I pay BT nearly £500 per annum for sub 3Mb service (and 150Kb up)

Not had cause to look at it recently, but have you investigated satellite - I appreciate it does have latency issues, but if your requirement is to be able to transfer larger volumes of data it might give you more for your £500pa cost...

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Anonymous Coward

Get stuffed BT, give the £600M to B4RN so people can have proper 1Gps fibre rather than your crappy FTTC.

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Anonymous Coward

1.4 milllion households need speed raising to meet the target USO.

With £600M issued to B4RN, what are the other 1.35 million households going to do?

B4RN is a great community project, but it's not feasible for nationwide deployment.

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@Anonymous Coward

"Get stuffed BT, give the £600M to B4RN so people can have proper 1Gps fibre rather than your crappy FTTC."

they could just give me the £600m & i'll sort them a decent net connection too.

i suspect BT won't be too happy just handing over "loads a money" so some other comms company can profit from them, whilst a stupid idea, there is likely some competition law that forbids them doing so.

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> B4RN is a great community project, but it's not feasible for nationwide deployment.

And who provides the backhaul, anyway....?

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It's BT's money (or their investors') - so why would they give the money to someone else to build their own network with?

I don't believe B4RN wholesale, so your choice of ISP for ever more would be B4RN or no-one.

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Anonymous Coward

Out come the BT pensioners, workers and shareholders to defend the indefensible.

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Re: Get stuffed BT, give the £600M to B4RN...

I think the real opportunity for sub-loop unbundling and competition was missed with the BDUK project.

People just need to accept that only BT know which households are getting sub 10Mbps service - something they won't voluntarily disclose, just as they wouldn't disclose similar information to the BDUK project.

The best that can be achieved here is for Ofcom to impose constraints on BT so that they use and enhance existing alt-ISP services rather than compete. For example, a local village in the BDUK last 5%, finally received service from Gigaclear last year after BT had been forced to publicly say it was uneconomic for it to provide FTTC service; it would be daft - but par for the course - for Ofcom to permit BT to now deliver FTTP services to that village.)

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Anonymous Coward

Re: Get stuffed BT, give the £600M to B4RN...

" it would be daft - but par for the course - for Ofcom to permit BT to now deliver FTTP services to that village"

Any UK telco can provide service anywhere it wants to, there are no restrictions. What limits them is their ability to actually make any money or even cover their costs.

If telcos agreed to divvy up the country between them that would be a cartel and illegal.

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Re: Get stuffed BT, give the £600M to B4RN...

Any UK telco can provide service anywhere it wants to, there are no restrictions. What limits them is their ability to actually make any money or even cover their costs.

What you've missed out is BT's (whether that's BT or BTOR I'm not sure) policy of not providing service to low return areas UNTIL that area has an offer from another provider. B4RN had that, and apparently a lot of other networks have had it too :

BT tells a village that they won't be getting FTTC, so another provider decides it's viable. Once that other provider announces it's plans, BT steps in and announces that "after a review" it is now viable to offer FTTC after all. This is clearly a well poisoning exercise designed to stop other providers getting the critical mass of subscribers - and anecdotally BT will go around signing up customers to ADSL (with a 24 month contract) and the "promise" of FTTC "very soon", thus tying customers to BT so they don't sign up with the alternative provider.

B4RN mention this on their website, IIRC it happened in a number of villages.

So it's understandable that another provider might want to know BT's plans before they commit a lot of money. If BT publicly state that they won't be providing FTTC (or any other fast service) to a location then there's a better chance of making a go of it than if BT state that they will be. Because of BTs size, they can do things that other providers can't - it's just plain economics that if you have a huge profitable base then you can afford to take more risks at the edges, while if most of your services are at the edges then you have to be a lot more careful.

BT has a history of making business decisions which are clearly and blatantly designed to protect it's most profitable services. Predatory tactics designed to damage competitors (especially the small ones with better offerings) are nothing new.

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Trollface

Sausages!

I'll see yer wee twelve inch English Morrison's in 13 whole inches of puff pastry (oooh matron) and raise ye a wee bit 'o Scottish willie waving.

We need a sausage icon. Approved by the elReg units soviet.

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Unhappy

B4RN sound like a good model. I'm curious why other areas could not form similar.

A charity that cannot be taken over and has to distribute its surplus to its members (or reinvest them in improving the service) sounds like a pretty good idea to me for areas with low population densities.

I'm sure BT have lots of reasons why they should be quietly strangled.

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Anonymous Coward

I love the confidence people have in the magic power of "regulation" - must be because its worked so well in finance, transport, power, building, ...

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Anonymous Coward

In what way are you saying it doesn't work? Are you saying these industries would work better without regulation?

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NI did it some time ago

In Northern Ireland, the local government paid for rural broadband using a mixture of companies. Where fixed lines didn't reach, there were companies setting up wireless links to groups of houses. And in the most remote areas they used satellite Internet.

Now they have to do it all again, since bandwidth needs have gone up, but they can still use the same mix of companies and technologies.

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Re: NI did it some time ago

... there were companies setting up wireless links to groups of houses

Meanwhile, over here the government in a dramatic show of joined up thinking (that's sarcasm BTW) more or less killed off the wireless internet (and alternative cable) industry by way of business rates. IIRC, basically, they decided that someone with a radio mast must pay business rates on what the tower could potentially make in revenue if fully utilised to the maximum the technology permits - while not similarly crippling BT OR for it's poles and ducts.

Around here, we had radio offerings (initially done under government financing) which in places meant several masts to repeat a signal to a small (or even, single) user. Turning round and charging business rates on the basis that the tower providing service to one user as though that tower was servicing hundreds of users is a sure fire way to kill off the service.

And the estate my work office is on has manholes labelled Norweb Telecom because they (I assume with grants) put in ducting when the former ironworks was redeveloped. Vodafone (the current owners via a chain of acquisitions, Norweb Telecom -> Yourcomms -> Thus -> Clueless & Witless -> Vodamoan) have decided to abandon all these ducts (and the ability to provide direct fibre services without involving BT OR) - officially because they are clearing out "legacy" products, but I can't help thinking that the rates on the ducts used to support a very small number of users just doesn't make it worthwhile.

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