Fujitsu plans superfast fibre broadband for rural UK

But scheme for fibre direct to five million rural homes contains caveats…

Fujitsu expects to spend between £1.5bn and £2bn on the network, which will be mainly fibre to the homePhoto: Shutterstock

Fujitsu has announced plans to roll out a superfast broadband network to five million rural homes.

The Japanese giant will invest between £1.5bn and £2bn in the network, which the company aims to make at least 90 per cent fibre to the home (FTTH), according to Andy Stevenson, CEO of Fujitsu Telecommunications.

"We don't think fibre to the cabinet (FTTC) is what people want. However, there will be some geographies where FTTH is just not possible," Stevenson told silicon.com.

FTTH would give Fujitsu's broadband network speeds of up to 1Gbps - and eventually even above 10Gbps - which is far faster than the speeds on offer from BT's £2.5bn next-generation fibre investment. BT is rolling out a predominantly FTTC network, which supports speeds of up to 40Mbps.

However, Fujitsu has made several caveats to its promises of fast internet to neglected rural areas.

Stevenson explained that the projection of delivering broadband to five million homes is dependent on Fujitsu winning contracts from local authorities that have applied for funding from government agency Broadband Delivery UK (BDUK).

"The [BDUK] funding is applied for on a local basis. It is not a foregone conclusion that Fujitsu will win the contracts as we will be competing against other competitors such as BT," he said.

In response to Fujitsu's announcement, BT released a statement saying it welcomed new organisations willing to contribute to the rollout of fibre broadband in the UK, but added that "the devil is in the detail". BT said it wants assurances that certain ISPs will not be favoured in the award of BDUK funding.

Point Topic chief analyst Tim Johnson told silicon.com that before Fujitsu announced plans to enter the rural broadband market, BT faced little competition. "Local authorities were clubbing together to apply for BDUK funding and in many cases BT would be the only credible contractor."

Johnson added that Fujitsu's entry to the broadband market is likely to have a significant impact on BT. "As far as the market is concerned, this intervention by Fujitsu is just what it needed to wake it up," Johnson said.

BT has already secured two large contracts using funding from the EU - one in Cornwall and the other more recently in Northern Ireland.

But before Fujitsu can even begin to compete against BT, Fujitsu's Stevenson said BT must...

..lower the cost of access to its infrastructure of poles and ducts, which Fujitsu needs to use to bring fibre to rural areas.

Fujitsu has said BT is setting prices too high for access to this infrastructure and earlier this month wrote a letter with Virgin Media, TalkTalk, Geo and Vtesse Networks to communications minister Ed Vaizey requesting BT to lower its charges.

Stevenson told silicon.com that BT's pricing presents a "significant barrier" to Fujitsu's planned network.

BT said in a statement it believes its current prices compare well with those found in Europe. The statement did, however, add that BT plans to carry out trials before finalising prices.

Point Topic's Johnson warned that the disagreement over charges for access to BT's infrastructure could stall Fujitsu's network rollout, adding: "It will probably take years to resolve and in the meanwhile, BT is making hay and the country is getting signed up to BT's networks."

Fujitsu hopes Ofcom will force BT to lower prices, allowing the Japanese firm to roll out a superfast broadband network to five million homes in three to five years.

Fujitsu's Stevenson said he expects funding to be available this year and that Fujitsu will be able to start building networks almost straight away, should it win the contracts available. "Consumers should have access to our networks by 2012," he added.

Fujitsu does not plan to offer broadband products directly to consumers but will instead sell broadband wholesale to Virgin Media and TalkTalk.

TalkTalk CEO Dido Harding said in a statement that TalkTalk's intention to sell on Fujitsu's superfast broadband network will complement the company's existing plans to develop its own FTTC rural broadband network.