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UK fibre-based broadband could cost £28.8 billion

Expensive future for broadband
Monday, 8 September 2008, 12:12

THE COST of taking fibre-based broadband into every UK home could cost a whopping £28.8 billion, accordingto a report compiled by the government’s broadband advisory group.

The report covers the different options when looking at the UK next generation broadband, most importantly, outlining the cost – showing that taking the fibres to street-level boxes would cost only £5.1 billion.

Antony Walker, chief executive of the Broadband Stakeholder Group who compiled the report said: "The scale of the costs involved means that the transition to super-fast broadband will be challenging."

Walker hopes that the report will encourage an informed public debate on the key regulatory and policy decisions in the future.
The BSG report outlines three main options, the cheapest being the £5.1 billion street-level boxes – the other two options entail taking fibre to UK homes via a shared or dedicated cable.

The price tag on the latter options is considerably more at £25.5 billion for shared and a huge £28.8 billion for dedicated services.
The speed of these options is an important factor however, for £5.1 billion you get 30-100 mbps, shared cable brings you 2.5Gbps for each line and finally the dedicated cable will give you 1Gbps.

The report warns quite convincingly that even these choices fail to outline things such as the fact that the cheapest option would still be a lot more than the amount telecoms firms have already spent cabling up the UK.

However, Mr. Walker does point out that the enthusiasm for broadband could make these changes more appetising for telecoms firms. µ

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Comments
Stalking horse alert!

Would it cost £28.8bn to run glass to every UK home? Probably. That's because "every UK home" includes the Hebrides, the Shetlands, the Orkneys and every isolated little farmstead in every bit of British wilderness.

Would it cost £28.8bn to run glass to homes in every town with more than (say) 500 population? Not a bit of it, not even close. Probably an order of magnitude less, if that.

It seems to me that the broadband industry's using well-chosen and misleading words, plus scary figures, to create a stalking horse for a solution that better fits its vested interests.

posted by : Jon Green, 08 September 2008 Complain about this comment
Enthusiasm?

I can understand why Telco's dont want to invest large large amounts, but even 20mbps Cable is crap speeds! where I live you can get 1mbps ADSL or 20mbps Virgin. I'd love to have Fibre at 100mbps+ as I need the upload more than I need the download! There's 5 in this house and we'd all GLADLY stump up the cash for a decent speed!
Screw the cost of the investment, you'll make it back! Just stop crippling the internet in this country by relying on 100 year old cables made of aluminum and copper!!!

posted by : Peter Lewis, 08 September 2008 Complain about this comment
So...

what they really mean is 100-200 billion (maybe 300), going by our own UK estimate track record and the inability to get anything done on time - right?

posted by : Alex, 08 September 2008 Complain about this comment
damn

damn shame old Maggie didnt take BT up on its offer to install fiber to every house in the UK in the late 80s

Might actually have something worth bragging about, still if they could at least get fiber to the distrabution boxes in the near future folk living in the middle of nowhere might get a slightly better connection than a copper all the way setup as it is now.

posted by : Darren, 08 September 2008 Complain about this comment
Well...

Well, at least according to a telco executive in a third world country (very different history, yes...), the last mile is by far the most expensive endeavour on establishing a network, particularly due to taxes on the use of space, maintenance costs and the high volume of equipment needed...

Now, according to a telco equipment developer of the same third world country, establishing a GPON (wich is probably what you're talking about) is 70% passing fiber, and only 30% equipment in costs. So I can guess using fiber will be much more expensive than using the existing copper networks, but not more expensive than passing new copper networks to substitute the garbage we have here...

But the biggest advantage of a GPON network is scalability... Common GPON already has bandwidth for 23-24 100M/50M connections, or much more 30M connections, and we all know telcos like oversubscribing their system: Dynamic TDMA takes care of that.

Going from GPON (2,5G/1,25G, using CWDM) to WDM-PON (4 channels, 2,5/1,25) will be a question of changing some boxes on the server. And since nobody really wants to pay for 2,5G+ connections: You won't need even to change the access much... wich is good, since it's costly.

posted by : Thiago, 09 September 2008 Complain about this comment
About time...

It's about time someone started to think about doing this. There as been no investment in the local loop connection for decades. The cable companies haven't laid any new cables this century.
I remember watching a cable getting close to my town in the 90s... And then they ran out of money and it never arrived.
So now I'm stuck with adsl which is just making 2meg down but it's touch and go at times.
When I visit my friend in Poland he also has 2meg, but his is symmetric, cable, and has loads more headroom if he wants to pay for it. Not that he's having to pay much for what he's got already!

posted by : Steve, 08 September 2008 Complain about this comment
Come on The Inq, did you do the maths for each home?

Assume 20mil homes for 55-60mil people in UK. Average cost for each house to have a cable attached to the outside wall is:
£25,500,000,000 / 20,000,000 = £1,275 per house.

That is fantastic money when you consider it costs approx £10/metre for a cable to be laid in the street. How are they making up the extra £1,200 per house? What is that paying for?

The mathsis bullshit.

I love The Inq but come on guys, don't just regurgitate numbers, think about them for 5 seconds.

I know guys who laid the cable all over this country in the 1980s and 1990s, if they got even a whole 1 percent of that £1,275 per house then we'd all have cable long ago!

I've told you the price of the labour of laying cable in a street, this includes the digging and back filling and "making good" of the roads and footpaths. Now if you can find out the cost per meter of the cable we have a solid cost of the streetworks side of things. The rest is "only" the exchanges and the backbone.

I've no doubt that there will be a connection charge, and that this will cover the cost of changing over from the existing phone line to the new type cable. Also it would include the engineer fitting the new face plate, as well as plugging the lead in the exchange into a different socket.

Most of the cable ducting has been put down so that any new cables can just be pulled through, so no need to even dig the roads up, lowering the cost of this even further.

If it cost more than £250 per home connection I would be looking at where the money is going and who's pocket it's really lining.

posted by : interested_party, 10 September 2008 Complain about this comment
You have my sympathy

Four years ago, I made the brave step of emigrating from the UK, to a *real* first-world country (Germany).

At first, DSL here was pretty much the same as the UK, until investment was made in VDSL. I was fairly nonplussed about it, until I learned that the up/down ratio was 1:5. Yes, that's right - for a 25Mb connection, the upstream speed was 5Mb. And if you got 50Mb down, you got 10Mb up. Oh, and no silly upload/download limits. It really *is* unlimited usage, too - no silly download limits or traffic shaping.

(As an added bonus, we even get our rubbish collected on a regular basis!)

My parents in Birmingham have the fastest Virgin/Telewest connection that money can buy, but they still only have a measly 256Kb upstream on it. It's barely enough for VoIP, but I was hoping they would have more, since I'd like to set up a videophone between us. Even my old 3Mb DSL connection here had 450Kb upstream - which is still nearly twice as fast as the upstream on Virgin's premium internet package...

posted by : Oliver, 10 September 2008 Complain about this comment
I agree

According to my knowledge, 1 meter of cable (metro, good physical resistance, more than sufficient for limited CWDM) costs minus than 10 dollars (I have been told the costs in other currency, so I'm aproximating). And laying out it costs from the same (much more common) to twice (very bad case). Again, in a 3rd world country far from you... So yes, 29 billion euros is a crazy number for passing fiber to homes, at least from my view. I mean, UK is a small country.

There are other components on a typical GPON setup, but they are passive (splitters), divided between clients (the OLT) or are at client's expense (ONT). So here comes the 30% number.

But... I don't know what are the costs for changing the entire access network to fiber. This could be costly. But I don't think you'll need to change the entire access network, I guess most access centrals on the UK are already connected by fiber.

posted by : Thiago, 10 September 2008 Complain about this comment
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