FTTP Pricing under BDUK

According to the NAO report the BDUK project has about 20% of the total project cost (at least on the framework contracts they'd examined) allocated for Other technical solutions (predominantly enabling fibre direct to premises) (see fig 11 on page 33).

http://www.nao.org.uk/wp-content/uploads/2013/07/101...

This begs a question. If FTTP is to be used to reach some premises, as the NAO report implies, then a big issue arises over the wholesale pricing of the current Openreach FTTP-on-demand product. As it's currently priced, it's a premium product unsuited to domestic use, even if the installation costs are covered by BDUK. The wholesale rental price is simply prohibitive.

Of course the standard OR installation charges for FTTP-on-demand probably don't have too much relevance where it's used to connect multiple properties in a cluster, as it would clearly be a lot cheaper than doing one at a time.

Hence the question. If OR FTTP is to be used under BDUK as a solution for domestic properties, are there going to be wholesale products which broadly mirror the FTTC products in price and/or capability? Of course, it might just be that fibre-to-the-premises will be reserved for businesses that can afford the monthly rental.

Alternatively a fibre-to-the-node model could be adopted which matched the prices and technical capabilities of the normal FTTC products, but the NAO report is explicit in referring to mostly fibre to the premises.

So can anybody shed light on the issue of FTTP wholesale pricing under the BDUK framework agreements? No doubt domestic use of FTTP comes at the tail end of any project for the most difficult locations, but it is surely an issue that needs addressing.

(if I look under the superfast Cornwall site I find only reference to FTTP on demand).

In these cases the pricing would be the standard GEA-FTTP pricing, which means if you order a 40 Meg or 80 Meg service it is exactly the same price as the GEA-FTTC services.

Cornwall has lots of FTTP only areas, and more areas with FTTP on Demand as an option where FTTC is also available.

Remember FTTPoD pricing only applies if the line has already been served by a FTTC service.

OK - that clarifies it. If FTTP is provided as a solution under BDUK, from a wholesale pricing point of view it just looks like the FTTC pricing (and service). A sort of virtual FTTC over FTTP product. I was wondering.

Presumably all the extra costs of installation are just then subsumed under the BDUK project.

In reply to a post by TheEulerID:

OK - that clarifies it. If FTTP is provided as a solution under BDUK, from a wholesale pricing point of view it just looks like the FTTC pricing (and service). A sort of virtual FTTC over FTTP product. I was wondering.

Presumably all the extra costs of installation are just then subsumed under the BDUK project.

Not quite.

The user is able to purchase the standard Infinity 40/80 Meg packages as standard. However, they are also then able to upgrade this to the Infinity 3 and 4 packages (200 and 300Mbps respectively).

So it's not really virtual FTTC per say, they just share the base packages.

As an FTTP user under the Plusnet brand, the service I get is for 80/20 at the same price as the FTTC option. Plusnet now match their FTTP options to the FTTC tariffs.

No extra costs were involved (excluding the contractual "must have a BT based phone line" at all times by any supplier).

However, areas with FTTP installation as an option are few and far between.

There are no extra install costs, install costs to the consumer are the same.

In terms of the value for money for the BDUK process, it comes down to how much to install the GPON splitters and manifolds to a particular street. That is very different issue compared to the wholesale price BT Wholesale charge the retail ISP.

In theory nothing stopping Openreach using FTTP for every BDUK connection other than cost to Openreach and not enough gap funding available and time it would take to deliver.

I don't think there is an "option" anywhere. There is FTTC, FTTP, or neither. FTTPoD being a different wallet-band altogether.

I'm sure they are rare, but it looks like there will eventually be quite a few such installs under BDUK, albeit probably not until all the anticipated FTTC cabinets are upgraded. I guess as more money is found to tackle the last 5%, then it will become more common.

It's also relevant to a post on another site where somebody is claiming that BT have repositioned FTTP as a business product, and they have "no particular plans" for FTTP in the context of BDUK.

This is what he/she (NGA for all) claimed

I have counted excluding Cornwall and NI � £1.156bn public cash to address a combined intervention areas of 5.3m premises, to be served by 23,000-25,000 cabinets + plus some elusive future proofing. The latter becomes somewhat academic given BT have changed the positioning and pricing of FTTP to being a premium business product.

BDUK spotting Project Management savings of 35% points to £100m savings if secured across 42 contracts. This should be just the begining. Running a GEA economic model which mimics BT�s commercial rollout and making generous adjustments for network re-use, distance, repair and new duct shows a total £500m available for non-FTTC activity � the £100m is part of that. This includes the 19 submarine cables for H+I. I will publish this analysis by county once the model is peer reviewed.

With BT having no particular plan for FTTP, the question arises whether the councils will spend with someone else or not all.

Apart from the weasel words, "particular", it seems to me a claim that FTTP forms no part of BT's BDUK implementation. and that will leave funds either unspent or available to be spent with others. I think that conclusion is a bit difficult to justify.

It seemed to me odd - if 20% of BDUK funding was targeted at mostly FTTP, presumably BT is contractually bound to implement FTTP where that's required to meet the coverage target in their bid. NAO are also quite explicit that any overspend is a supplier responsibility, so even if FTTP proved more expensive to implement than anticipated, public funds are not at risk.

Of course, I'm not so naive as to think the framework bids are definitive in exactly what will be done, but I'd have thought that actual NGA 24mbps coverage targets are sacrosanct (albeit, I can imagine that something cheaper than full FTTP might be used in some cases - maybe Fibre-to-the-node).

http://br0kent3l3ph0n3.wordpress.com/2014/03/17/what...

Anyway, question answered. There are other specific issue about many of the heroic financial assumptions made on that site, but this one struck me as particularly odd an contradictory to what the NAO report strongly implies.

In reply to a post by TheEulerID:

It seemed to me odd - if 20% of BDUK funding was targeted at mostly FTTP, presumably BT is contractually bound to implement FTTP where that's required to meet the coverage target in their bid.

You are still getting confused between FTTP and FTTPoD. Or N4A is. Or both of you.

Remember that BT are currently (or intending) to supply FTTPoD anywhere that FTTC has been made available. The only service available with FTTPoD is the hugely expensive 300Mbps, 3-year deal. But note that preparing the ground for FTTPoD, when deploying FTTC, requires some initial "over-provisioning" work, to allow for both technologies to co-exist.

Meanwhile FTTP (or "native FTTP") is in places where FTTC does not exist. Base-level services are available over this native FTTP, at base-level prices.

As far as I can make out, N4A doesn't assert that 20% of BDUK funds are for native FTTP. His assertion is that 20% of the funds for an FTTC cabinet area is actually used for the over-provisioning necessary to support FTTPoD. He then further asserts that BT has no plan for FTTP, when, in context, he really means FTTPoD.

To my mind, he seems to be making a mountain out of a molehill. BT has *always* positioned FTTPoD as a business niche, even if they have put the price up and made it more obviously so.

So to clarify my understanding: This particular 20% isn't being budgeted for the council/BT to use FTTP to target widespread residential coverage (as you suggest in your post). It is there to use FTTPoD to target niche business coverage in places where FTTC coverage already exists but isn't fast enough for the business.

I believe you need to see FTTPoD as a component in a business service (ie the access component of a leased-line) rather than a consumer product.

I then see business ISPs bundling Openreach's FTTPoD access product with a wholesale-level leased-line core product with uncontended bandwidth - giving an entry-level leased-line offering. And this kind of product/marketplace will support the pricing that Openreach currently has for FTTPoD.

[As an aside, you are already seeing business ISP's making entry-level leased-line products this way, but using FTTC as the access component. These give 2/2, 10/10 and 20/20 products for £200pm. Quite cheap, really.]

In this guise, I *do* see that BT has a plan: That it intends to remove the need for digging or pulling fibre as dedicated leased lines, and that it intends to integrate future leased-line fibre into a unified fibre-based access network. The start of this unified network is the "over-provisioned" setup for FTTPoD.

Should council's/BDUK be paying for this over-provisioning?

In considering this, you need to remember that the councils aren't just aiming at widespread residential coverage (which is the aspect we punters think most about). They also want to get good focussed coverage for businesses too - and most councils seemingly prioritise the economic benefits of the latter. While consumers might want an 80/20 FTTC internet access (contended, but cheap), businesses would probably rather have a 20/20 uncontended leased-line service that costs.

Note too that the ERDF funding that some councils have added is *specifically* meant for business coverage.