The UK’s rural broadband rollout strategy, which had been placed on hold in July 2012 in order for European regulators examine to it, looks set to get underway again with the European Commission (EC) confirming that Broadband Delivery UK (BDUK), the umbrella support scheme for investments in next generation access (NGA) broadband networks, does comply with European Union (EU) state aid rules.
BDUK, a team within the Department for Culture, Media and Sport (DCMS), was set up to deliver the government’s broadband strategy, with its main role being to allocate and distribute funding to bring superfast broadband to the third of UK homes and businesses which are not expected to be provided for by commercial rollouts. The British government had originally aimed for an open process in which community groups and private firms would be commissioned to build Europe’s ‘best superfast broadband network’, with BDUK having published a framework covering 35 local authority areas, under which contractors competed to win equipment supply deals. However, with claims that the selection criteria had proved insurmountable, a number of companies, including Geo and Cable & Wireless, withdrew from the process last year. With fixed line incumbent BT and Fujitstu emerging as the only two companies to ink contracts for a rural broadband rollout, the EC said that no work would move forward until it was satisfied with the plans. One of the main concerns with the setup was reportedly that BT was unprepared to offer access on a sufficiently open basis to the infrastructure it will roll out, with Brussels thought to want the incumbent to allow rival operators to be able to rent its dark fibre.
With the EC suggesting that the total value of aid to be delivered by the scheme would be around GBP1.5 billion (USD1.8 billion), it claimed this would likely enable the UK to achieve the objective of the EU Digital Agenda of coverage of 30Mbps networks for all European citizens. Further, noting that the design of the BDUK scheme contained several ‘best practices’ which it claimed would ‘help to ensure more effective, better targeted and less distortive public interventions’, the EC also pointed out that UK telecoms regulator Ofcom will have a crucial role in designing wholesale access prices and conditions. The UK meanwhile is understood to have committed to submitting an evaluation of the scheme to the Commission before 31 March 2015, while it will also ensure that any forthcoming scheme will take this evaluation into account.
Commenting on the decision, Joaquin Almunia, EC vice president, noted: ‘BDUK, as a national competence centre, will assist local granting authorities in designing and implementing successful broadband support measures in line with EU competition rules. The umbrella scheme will be a big step towards the achievement of the EU Digital Agenda targets and a strong impetus for growth in the UK.’