In a statement, Geo chief Chris Smedley said BT is putting
unreasonable restrictions on access
to its ducts and poles (known as Physical Infrastructure Access,
or PIA). He also said the BDUK 'gap-funded subsidy' model gives BT, as
the only existing provider of telecoms services to some parts of rural
Britain, too much of an advantage.
"Whilst pricing may have reduced for the current PIA product (still
not far enough in our view), the real issue is that it can only be
used for providing the final drop from local exchange to a residential
broadband consumer's house," Smedley said. "PIA cannot be used for the
far more costly task of crossing the long distances in rural areas to
get to these remote communities (backhaul), making the idea of being
able to build new fibre connections within them faintly
The gap-funding model is hugely favourable to the current supplier, as they have all the revenues on their copper network.– Chris Smedley, Geo
The PIA restrictions also mean other ISPs cannot use BT's ducts and poles to provide backhaul for mobile or
wireless infrastructure, or even to deploy leased lines to business
customers, he added.
Ofcom told BT to open up access to its ducts and
year ago. The costs of getting that access have been a subject
of intense argument, but BT said on Wednesday that PIA trials are almost complete.
According to BT, Fujitsu UK hooked up its first customers last week
using PIA, and PIA will come out of the trial phase later this month.
In BT's words, "all UK communications providers will be able to order
the new products from [BT] Openreach on an open, wholesale basis".
Geo is one of the companies trialling PIA, and Smedley told ZDNet
UK that its withdrawal from the BDUK will not change that participation. Nonetheless, he said, BT should voluntarily remove its
PIA restrictions or Ofcom should force it to do so in its upcoming
Business Connectivity Market Review. The telecoms regulator's review is not due to conclude until
towards the end of 2012, however.
On Thursday, Ofcom told ZDNet UK it is "reviewing
the business connectivity market and as part of this will consider the
role that access to ducts and poles play".
PIA is only one of the problems cited by Geo. Another major issue
is the way BDUK allocates funds. Bidders approach the funding group with a figure of how much
capital they can put into a fibre deployment; BDUK then chooses the
bid that requires the least public funding. The public funding goes to fill the gap between the
bidder's funds and the amount needed to complete the project.
According to Geo, a public-private partnership model would be
preferable. This would allow bidders that do not already have major
guaranteed revenues to share the risk with the public sector, Smedley argued.
"The gap-funding model is hugely favourable to the current supplier,
as they have all the revenues on their copper network," he said.
"Much of the UK still has only BT's network, with other service
providers using BT's asset. BT has a perfect knowledge of the size of
the market [and has] the least risk, so it can make the biggest offers
Finally, Smedley criticised BT for not offering a "truly open dark
fibre product" to other providers, in the case of publicly-funded
deployments. Dark fibre is unlit, unmanaged fibre that could be run
without BT's interference.
According to Smedley, a dark fibre product could be set up along the lines of 'local-loop unbundling' (LLU). Regulators forced BT
to institute LLU on its copper network, so that rivals could avoid having to
resell BT's wholesale product by installing their own kit in BT's
"We don't believe in virtual unbundling," Smedley said. "Full
unbundling is what we're interested in, and in the fibre market that
is dark fibre. We want, when BT is rolling out new fibre networks with
public money, that they be compelled to offer a dark fibre product to
the rest of the industry."
BT responded to Geo's withdrawal from the BDUK framework by
suggesting Geo did not have what it takes to roll out fibre on a large
"Geo's departure is disappointing, but hardly a surprise given fibre
deployment requires a high degree of commitment and expertise," a BT
spokesperson said. "It is ironic that Geo are trying to blame BT,
Ofcom and BDUK for their withdrawal at the same time that the major
players are making such good progress."
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