The government’s plans to roll out fibre optic broadband in rural areas received a huge blow last week as the Commons Public Accounts Committee condemned them as poorly managed, and a rip-off for the tax payer.
Chairwoman of the PAC Margaret Hodge described the project, in which BT have been awarded contracts to provide super-fast broadband in a huge number of rural areas, as “exploitation of a market by a monopoly provider”. She states that BT have very high costs with no transparency, and that although they are not providing full rural coverage, they are stopping any other provider from attempting to do so.
The government has defended its position, stating that the rural rollout of super-fast broadband has become a necessity, but that commercial firms see little benefit in providing services in sparsely populated areas so it has had to be subsidised. Between the government subsidy and local authority contributions, the total funding available for the project was 1.2 billion. They state that only two companies placed bids for the project, BT and Fujitsu, with Fujitsu later retracting their bid, so they had no choice but to award the contracts to BT.
So How About 4G?
The question has to be asked, is it necessary for rural areas to have expensive fibre optic broadband, or could similar results be achieved with 4G? None of the service providers that are rolling out super-fast mobile internet placed bids for the rural contracts as the rules for the process made it clear that mobile broadband would not be considered as an option. However, both Vodafone and EE have released statements urging the government to consider 4G as an option.
Vodafone stated that “The current BDUK process simply will not deliver value for money nor the rural connectivity that Britain needs. The government should urgently revise the process to encompass wireless 4G in order to make digital Britain a reality.”
Already it seems that 4G connectivity may arrive in rural areas sooner than fibre-optic broadband, and with far less cost to the taxpayer. BDUK, the government agency handling the fibre-optic rollout, aimed to provide super-fast broadband to 90% of the UK’s population by 2015, a target that looks likely to be extended to 2017. On the other hand, mobile service providers EE, Vodafone, and O2 have committed to providing 98% coverage by 2015.
While it is true that 4G speeds may be a little slower in some places than fibre-optic, it would provide a more immediate and low cost solution, with overall better coverage. EE have already begun testing 4G in the Northern Fells in Cumbria, a rural area that is unlikely to receive fibre-optic from BT for many month if not years.
At the very least the PAC report recommended that detailed rollout plans should be published showing the areas where BT will not provide fibre-optic, so that other options can be considered. Ideally, they suggest that no more of the tax payer’s money is spent until the whole process has been revised and all the possibilities, including 4G mobile internet, have been considered.