How a £48m public-private fibre broadband partnership is helping SMEs
Bob Jordan is in his front room explaining how his broadband used to be: slow. So slow that the Belfast pensioner would have to go and put the kettle on while waiting for his email to download.
Being in the broadband slow lane also meant that watching video was pretty much out of the question. "I've tried to download lots of things in the past, but of course all this buffering meant that if you did look at it, you just packed it in," he said.
But fortunately for Jordan - and other business and home users in the area - the broadband infrastructure in Northern Ireland has been coming on in leaps and bounds lately.
Five years ago the region was a broadband backwater, with only a quarter of homes connected, according to telecoms regulator Ofcom. Since 2004, an initiative by the Department of Enterprise, Trade and Investment (Deti), a devolved government department of the Northern Ireland Executive, has set a minimum floor for broadband access of 512Kbps to get more citizens online. And by August broadband take-up in the region had leapt to 70 per cent, all but matching the UK average of 71 per cent take-up - and outstripping the 64 per cent figure for Wales and 61 per cent for Scotland.
Pensioner Bob Jordan is one of the consumers to benefit from faster broadband speeds in Northern Ireland
(Photo credit: Natasha Lomas/silicon.com)
Northern Ireland now boasts 100 per cent broadband availability, with 99 per cent of residences and businesses covered by DSL and the last one per cent reached by a satellite broadband service. This push for take-up was accompanied by the launch last May of an official government website, NIDirect, giving the public online access to a range of government information and services, from applying for car tax to ordering a birth certificate and hunting for a job.
Of course 512Kbps is a barebones broadband service by today's high-speed standards, and well below the UK average for download speeds - which was 5.2Mbps in May, according to Ofcom. But since last year the region has been working to speed up its network with a fibre injection - a £48m public-private partnership is in the process of rolling out fibre to the cabinet (FTTC) to exchanges in rural and urban locations.
This initiative explains why retired chartered engineer Jordan is now enjoying speeds of up to 37Mbps via his Belfast-based ISP UTV Internet - watching TV on his PC, uploading scanned photos, and keeping an eye on his premium bonds. His previous sluggish 700Kbps broadband service is now all but forgotten.
"I use the internet for everything that I can use it for. All my travel I book on the internet. I purchase online," he says. "The last thing that I bought online was a floor-sweeper. I do use [the internet] continually... If the computer goes down for a day now I'm in trouble."
"The different [FTTC] makes to downloading is no buffering," he adds.
Northern Ireland's FTTC rollout is targeted predominantly at businesses to maximise the economic benefit of the broadband investment to the region but consumers such as Jordan, who live near fibre-enabled exchanges, will also...
...be able to tap into faster broadband speeds. By May 2011, when the 18-month rollout is due to be completed, almost all businesses - 95 per cent, up from the original target of 85 per cent - will have FTTC broadband, with a minimum download speed of 10Mbps in urban areas and 2Mbps in rural locations.
"This [rollout] was fundamentally structured around the areas where we didn't think there was an economic case for fibre," says Graham Sutherland, CEO of BT in Northern Ireland. "This effectively does the bulk of the third that's not viable."
The £48m FTTC investment is a public-private partnership between BT and the Deti, with the public sector funding underpinned by the European Regional Development Fund (ERDF) and the European Agricultural Fund for Rural Development.
BT is investing close to £30m, with £16.5m coming via European funds from Deti, and £1.5m from the Department of Agriculture and Rural Development. Rural areas have been earmarked for two-thirds of the government funding.
"One of the important issues for us was that we deliberately, being a rural part of the world, designed the project with focus on rural areas. The money was skewed heavily in that direction," says Arlene Foster, minister of enterprise, trade and investment, noting that many farm businesses need access to faster broadband.
"We're very much an SME economy," she adds. "Therefore we need people to be connected across the piece."
Funding for Northern Ireland's next-generation broadband project is skewed towards rural areas, says minister
(Photo credit: Natasha Lomas/silicon.com)
BT has been rolling out FTTC broadband in Northern Ireland since December last year, with the fibre footprint set to cover some 260,000 households in total - roughly one-third of the households in the region. The project is a similar model to the Cornish fibre to the home rollout announced earlier this year.
Wales is the only other UK region that could benefit from European development funding - but is not the only other area in the UK where broadband speeds are stuck in the 'go and boil the kettle' lane.
The UK government recently announced...
...four market-testing pilots, in the Highlands and Islands, North Yorkshire, Cumbria and Herefordshire, to test the commercial viability of deploying high-speed broadband in other remote parts of the UK that do not qualify for EU cash.
BT has committed to rolling out fibre broadband access to two-thirds of the UK by 2015 but says there's no business case for it to go it alone on the final third. The company is in the process assessing broadband demand via its Race to Infinity web survey - to help decide exactly where its fibre footprint will fall.
Beyond two-thirds, BT says it is open to approaches from communities that are able to raise funding themselves, according to Liv Garfield, group director of strategy, policy and portfolio. She cites the example of Iwade, a village in Kent, which raised £12,500 towards a broadband rollout - and in doing so "unlocked" £35,500 of BT funds.
"If [a community is] saying 'we've got some funding and we'd love to talk to somebody to enable our funding' then I'd love to speak to them," she says. "Without public funding, or private funding in some sense, there isn't going to be a case that can get fibre to 100 per cent of the UK."
John Sherry, Joseph Ireland and Hugh Morgan, founders of SME Energy Assessments, say fibre has increased productivity
(Photo credit: Natasha Lomas/silicon.com)
While most parts of the UK continue to wait for a fibre revolution, Northern Ireland's rollout is more than half way to being completed, with some 60 to 80 per cent of businesses in rural and urban parts of the region now within reach of FTTC, according to BT's Sutherland, and 3,000km of fibre laid already.
"Over 9,000 hours have been expended on the project all from a standing start, which was effectively paperwork in a room less than 12 months ago - and a lot of paperwork," he adds. "It shows you, with the right relationships, how quickly this can be done."
One Northern Irish business that is already benefiting from faster download and upload speeds is Energy Assessments - a company set up in 2008 by three university friends Joseph Ireland, Hugh Morgan and Paul Sherry. It provides energy compliance ratings services for new buildings. The business is based in Newcastle, County Down, about 30 miles south of Belfast, and chose a town rather than city location to keep its overheads down. The arrival of FTTC just over two months ago has boosted business productivity, says Sherry - turning a 3Mbps to 4Mbps connection into one that's typically in the "high 30s".
"The faster the connection, the faster we can issue certificates," he says. "It would have maybe took 15, 20, 30 seconds to upload a certificate. Now it's more or less instant so definitely it helps us that way."
"We're at no disadvantage compared with city-based competitors," he adds. "A lot of our work is with architects and we have to receive drawings. Usually before when we were receiving drawings by email you would have been waiting up to a couple of minutes to receive big files.
"Sometimes it was better even to call in with them, pick them up, come back, start your work, but now they pretty much come through instantly, which is a big benefit to us. We can get working straightaway."
The company is also able to be more agile in responding to tender alerts online, and can work remotely with survey data on contracts in mainland UK from its Newcastle office, rather than having to remain in the area where the surveyed buildings are. "You need high-speed internet to be able to do that," adds Morgan.
Another business that has seen a boost...
...in the past few months since its exchange got fibre-enabled is wholesale picture and mirror manufacturers, JR Annett, based in Warrenpoint, County Down. The ability to send digital catalogues instead of paper ones has led to significant savings, says owner John Paul Annett. The company was getting 3Mbps to 5Mbps download speeds before fibre. It's now able to get 18Mbps to 19Mbps.
"It's saved us an absolutely fortune," he says. The company's paper product catalogues cost about £6-a-time to produce so cutting back on the number it sends out has led to significant cost and time savings. "That's the main reason for the fibre being great for our business.
"From a point-of-sale point of view, when you're speaking to a retailer you're able to email a whole set of catalogues straight away and speak to them on the phone with it. With the broadband [before] you were never able to do that. You'd have to email them, wait 20 minutes, 30 minutes, ring back and they'd be away with another customer. You just couldn't get your point of sale across."
Annett says the company spent about £1,000 per month producing catalogues last year - a figure he reckons could easily have inflated to £5,000 or £6,000 per month without the FTTC upgrade after it expanded sales to the UK mainland this year.
Picture and mirror manufacturer JR Annett has saved on catalogue printing costs with the help of FTTC
(Photo credit: Natasha Lomas/silicon.com)
The business has also benefited from being able to batch-upload high-resolution images to its website to ramp up the range on show - a painstaking process over its previous connection, says Annett. It's also planning to upload videos showing the manufacture process of its products to YouTube in future as a marketing aid.
Asked what will happen to the five per cent of Northern Irish businesses that won't be covered by the FTTC rollout, the Deti's Foster tells silicon.com: "We will be looking to see how we can fill in the gaps for those people who haven't been able to avail of those speeds and I'm sure once the contract is finished... then we will go back and look at where the gaps are."
The Northern Ireland Executive is also exploring wireless infill technologies that it could use to bridge any next-gen digital divide, she adds.
"Last month national government announced the aim to have the best superfast broadband network in Europe by 2015," she continues. "I hope you can see that our next-generation broadband project... is very much aiming to get there before anybody else and we believe that will really help us here in the Northern Ireland economy."
UK government ministers have yet to confirm exactly...
...how they will define "best" - although Secretary of State for Culture, Olympics, Media and Sport Jeremy Hunt has previously said speeds of between 50Mbps and 100Mbps would be required if the claim is to be "credible".
Since then Robert Sullivan, head of Broadband Delivery UK, the government body set up to oversee the universal 2Mbps broadband commitment and administer any next-gen broadband funding, has suggested the government is softening its stance on what "best" means - moving away from big headline speeds and looking instead at a range of measures.
"We have started work on trying to address the question of what best in Europe means," said Sullivan, speaking at a Westminster eForum on broadband earlier this month. "We are still working with ministers on the definition of this and trying to expand this.
"We know that choosing one particular number or one particular target is probably not the best idea, so we are looking at something more like a scorecard," he tells silicon.com.
"It's most important that we think about what are the applications that consumers and businesses actually want to use to drive their businesses or to enable rural communities to be sustainable, whether they are healthcare, education or whatever," he added.
BT's Garfield also foresees a broadband scorecard: "You have to do a mixed set of measures - you have to do some kind of balanced scorecard."
As it stands, Garfield says BT has no plans to go back to FTTC areas and upgrade them to FTTH, so the UK's network infrastructure will remain capped for speed for the foreseeable future. "Certainly in the short term or medium term there's no [business] benefit in going back and spending more money on infrastructure projects," she says. "It's already a leap of faith... Our plan is a mixed economy fibre situation because the topography of the UK is best suited towards that," she says.
"The speeds [customers] talk about are the throughput speeds," she claims. "What you find with fibre to the cabinet is the vast majority of people get between 33Mbps and 38Mbps... but it's the fact that you've promised them they will get 15Mbps at all times that they get very excited."
In the short-term, the Northern Ireland experience shows the difference between 512Kbps and 15Mbps can be transformational for SMEs and consumers - making the difference between a broadband service that's technically useable and practically useful. One in which "the frustration factor has gone", as JR Annett's Annett puts it - at least for now.
However, since Garfield's comments, BT Wholesale has announced it will be offering a second FTTC service with a lower guaranteed minimum still: 5Mbps. And with FTTC set to make up the lion's share of BT's UK fibre rollout - some 75 per cent, versus 25 per cent FTTH - one thing is clear: broadband Britain will get better over the next five years but only a tiny minority will have access to Hunt's best.