Could an exchange selloff part fund FTTP?

BT have a few thousand exchanges across the UK. Many of these are rather large (but these days mostly empty) buildings that often have a decent amount of parking space and are in central locations. They could be converted to either flats, or large 6 bed type houses.

If we had universal FTTP, we wouldn't need telephone exchanges anymore.

If we assume FTTP rollout will cost £12bn, and there are ~5600 telephone exchanges, then a selloff of the exchanges could perhaps fund 1/4 to 1/3rd of the rollout.

Would this not make sense?

Been there and done that, 16 years ago http://www.telegraph.co.uk/finance/4477080/BT-hoists...

Exchanges are leased back on long term leases from the people that bought them.

In reply to a post by nemeth782:

BT have a few thousand exchanges across the UK. Many of these are rather large (but these days mostly empty) buildings that often have a decent amount of parking space and are in central locations. They could be converted to either flats, or large 6 bed type houses.

If we had universal FTTP, we wouldn't need telephone exchanges anymore.

If we assume FTTP rollout will cost £12bn, and there are ~5600 telephone exchanges, then a selloff of the exchanges could perhaps fund 1/4 to 1/3rd of the rollout.

Would this not make sense?

Probably, but it would make more sense, I think, to milk the living daylights out of existing infrastructure incrementally.

The buildings may not house very much equipment however there are large numbers of bundles of copper and fibre running in/out of the buildings. That needs to be located somewhere. Even with the sale and leaseback there are conditions that will prohibit some developments as construction work could seriously damage the cables.

And universal FTTP - NO CHANCE. Costs would be astronomical.

And exchanges aren't just used for consumer equipment, a lot of companies house their own equipment in unbundled exchanges in order to host private networks.

Hehe!!

My wife spent half her working life buying space for new exchanges and exchange expansion, and the other half selling them or the add-on bits off and setting up leaseback.

Would universal FTTP need some form of (physical) concentration node/s, amounting to exchanges?

In reply to a post by eckiedoo:

Would universal FTTP need some form of (physical) concentration node/s, amounting to exchanges?

Exactly, as I said, large numbers of cables and FIBRES in/out of buildings.

BT don't tend to leave space empty. They may use it as office space or an engineering base of lease it out. Security though has to be considered. You will also find the roof space has often been leased out for radio masts

Universal FTTP is not that expensive when you look at the big picture. FTTC is limited and increasingly BT are have to spend more and more money to keep it working or push speeds up very marginally

FTTP does not mean you automatically put Fibre in to every home it would follow the VM approach and the Fibre would just pass your door and would only be connected to the home if you subscribed. There are advantages though to every home having fibre as it means you can do away with the legacy voice system and FTTC system which would save a lot of costs and allow the redundant copper to be recovered and sold off

In reply to a post by Bob_s2:

Universal FTTP is not that expensive when you look at the big picture. FTTC is limited and increasingly BT are have to spend more and more money to keep it working or push speeds up very marginally

FTTP does not mean you automatically put Fibre in to every home it would follow the VM approach and the Fibre would just pass your door and would only be connected to the home if you subscribed. There are advantages though to every home having fibre as it means you can do away with the legacy voice system and FTTC system which would save a lot of costs and allow the redundant copper to be recovered and sold off

What do you not understand about the phrase UNIVERSAL FTTP - that means every property. And will you be picking up te bill for an friend of a friends install? One property, needing something like 15km of ducting and tens of thousands?

Been involved in a few building closures, it can cost many millions to get out of a building for BT this would include paying the LLU and mobile operators for moving their kit.

Until you can provide everybody on the exchange with FTTP you have to have another building close enough to serve the copper from and pay LLU operators to move their kit and take the flak for the reduced speeds their customers get due to the longer copper distance.

Remember that it could be construde as anti competitive as it tends to move anyone wanting a decent BB speed to Fibre products and could leave LLU operators with 'stranded assets' in the form of ADSL2+ equipment. ( Mind you they may be happy with being compensated but it all reduces your pot for FTTP rollout).

As Andrew pointed out the buildings are no longer BTs so the value to BT is less than expected and the long leases may actually cost BT to pay off the lessor. ( Howdens are still paying for some ex-MFI leases years after vacating them)

Nice idea to float and I'm sure BT look regularly for possible buildings but not feasible until BT is allowed to remove the copper and migrate all customers to fibre in an area. North York where Sky Talktalk are using City fibre could be the first place this is possible on a regulatory basis but still very expensive as it would lead to BT, City fibre and Virgin all having 'fibre' networks in the same area.

In reply to a post by RobertoS:

My wife spent half her working life buying space for new exchanges and exchange expansion, and the other half selling them or the add-on bits off and setting up leaseback.

Puts me in mind (a little) of this Dilbert gem:

http://dilbert.com/strip/1997-07-20

In reply to a post by MHC:

What do you not understand about the phrase UNIVERSAL FTTP - that means every property. And will you be picking up te bill for an friend of a friends install? One property, needing something like 15km of ducting and tens of thousands?

I wonder, if we were in the early 1900s, would we have a "thinkelectricity" with people like you saying "rural electrification? are you mad?!?!?! who will pay to have the wires strung to all those country piles".

Or the spread of water/sewerage and (to a lesser extent) gas pipes to every moderately dense area going.

Of course, it happened because the government decided it would happen, it resulted in huge economic benefits, it was paid off long ago, and no one talks about it now. Decent internet is quickly becoming as important as those utilities - and depending on where you live, BT and co may already have strung fibre to those far flung premises

Edited by deleted (Mon 18-Apr-16 15:03:18)

Did the government decide that sewerage and gas would happen? Or was it the market?

I know I grew up in a house that had no mains drainage (and doesn't now unless the new owner decides to pay to get it) and only received gas in the around 2000 (and I believe the landowner paid a fair bit towards it).

And I'm pretty sure if you build a new house and there is no electricity nearby then you pay the going rate to get the lines installed to the house.

As far as I am aware you pay for getting all of these services provisioned and it can be pretty expensive (a colleague bought a house and was going to get gas but was quoted I think about £30K).

If people are willing to pay the full cost of fibre then they can have it - but generally people aren't whereas they will pay for electric and water because they are truly essentials.

In reply to a post by sor:

Or the spread of water/sewerage and (to a lesser extent) gas pipes to every moderately dense area going.

A few miles from Aberdeen - the Hydrocarbon capital of te UK. Do we have gas? NO!

Friends 3 miles from Maidenhead - still no gas, still no mains drainage!

In reply to a post by ian72:

And I'm pretty sure if you build a new house and there is no electricity nearby then you pay the going rate to get the lines installed to the house.

As far as I am aware you pay for getting all of these services provisioned and it can be pretty expensive (a colleague bought a house and was going to get gas but was quoted I think about £30K).

Correct and water supply too. Yes you can do the trenching and maybe some ducting/pipework, which has to be to the right standard and inspected, however there are charges and they can be very high.


£30k for gas - they would not be the first to be quoted those sort of prices!

In reply to a post by ian72:

Did the government decide that sewerage and gas would happen? Or was it the market?

I know I grew up in a house that had no mains drainage (and doesn't now unless the new owner decides to pay to get it) and only received gas in the around 2000 (and I believe the landowner paid a fair bit towards it).

And I'm pretty sure if you build a new house and there is no electricity nearby then you pay the going rate to get the lines installed to the house.

As far as I am aware you pay for getting all of these services provisioned and it can be pretty expensive (a colleague bought a house and was going to get gas but was quoted I think about £30K).

If people are willing to pay the full cost of fibre then they can have it - but generally people aren't whereas they will pay for electric and water because they are truly essentials.

The government subsidises utility companies in many ways. I get a £50 reduction on my water bill each year because of where I live, for example

But in all of these cases the infrastructure is usually nearby, like at the road - you simply have to pay for the extension into your home.

With fibre, there is no such option short of getting a leased line from an exchange (let's not talk about the abortion that is (or was) FTTP on demand). It'd be like the electricity company deciding that if you pay for a supply for your new home, it has to either be a supply that could barely power a fan because you live far away from a substation, or it must be 3 phase and have enough capacity to power a small factory - with installation and rental costs to match

If you choose to build your house in the middle of nowhere, then connection costs will be high. But we're not really talking about that - but already fairly populated areas where BT or the other utilities would still easily be able to connect lots of homes (as they aren't a city centre, it's still "rural"). Or, in the case of FTTP, it would include urban areas too - where it should be easily profitable

The problem with this idea that everyone should pay for the "full cost of fibre" themselves is that you lose all the economies of scale involved with doing so. It's much cheaper for BT to wire up an entire street (even only as far as the DP) in one go than to have to design and engineer separate connections for each house that opts for it (which will be the case even if you manage to order FTTPoD)

In reply to a post by MHC:

A few miles from Aberdeen - the Hydrocarbon capital of te UK. Do we have gas? NO!

Friends 3 miles from Maidenhead - still no gas, still no mains drainage!

Hence "to a lesser extent"... I don't have mains gas either (though a major pipeline runs outside the village, there is nothing inside), and I'd gladly pay to be connected up if the pipes were to be run outside my house. Every other utility has been available for decades

These replies miss the point of my post entirely, unfortunately. The fact is that when those projects were proposed all the way back then, there would be people like yourselves claiming that it's too expensive or impractical, basically impossible - but fortunately such views were not listened to. We see this today whenever FTTP is mentioned. As I've said in another thread, in Britain we enjoy aiming for mediocrity and spending more time and effort finding ways not to do something properly, and it is unfortunate.

Edited by deleted (Mon 18-Apr-16 16:59:42)

I clicked along a few. I like this one as well.

In reply to a post by sor:

These replies miss the point of my post entirely, unfortunately. The fact is that when those projects were proposed all the way back then, there would be people like yourselves claiming that it's too expensive or impractical, basically impossible - but fortunately such views were not listened to. We see this today whenever FTTP is mentioned. As I've said in another thread, in Britain we enjoy aiming for mediocrity and spending more time and effort finding ways not to do something properly, and it is unfortunate.

The biggest difference is that (at the time), utilities were Government owned, so national expansion was funded by the population via taxes. It also didn't need to be concerned with any competing providers being put out of business - as there were none.

The family silver was sold a long time ago, so the utilities are now 'market driven' and answer to their shareholders. Indeed they have a legal obligation to do so.

Back in the 1850's to 1900's there was a lot of community action, local towns doing their own thing, the Government led intervention was not until much later, take a little time to look into the National Grid history.

Water and sewage was driven by public health.

One reason some rural areas are rolling out their own broadband is the way they are used to having to do things for themselves, rather than rely purely on the county council or Westminster.

Yes, but they always only served 'the (local) community', not everywhere nationally.
Even with 'Community Action', somebody paid for the work to be done.

It wasn't until the power companies were nationailsed in 1947 that work began in earnest to attempt to connect every property.
Even then some remained without until about 10 years ago.

The point was that it was funded centrally by Government, where the expectation now is that a private company should be altruistic and be prepared to make a loss for the benefit of others.

Edited by deleted (Mon 18-Apr-16 19:43:37)

But the fibre is now very close to many people - the FTTC rollout has provided fibre nodes that are relatively close to most users. BT don't currently offer a way to utilise that for FTTP but they probably will soon.

And comparing fibre to the rollout of other utilities is really pointless. The other utilities have had decades to get to the reach they have - come back in 50 years and fibre might be on a par... The other utilities did not become widely available in under a decade and yet you seem to think FTTP should. It may have been possible to do more FTTP but the business case just didn't stack up when this started - you may argue that people said it did but it wasn't their money on the line.

And if you think the government should have invested more it is highly unlikely that would have gone down well in a time when there was a major recession and massive over spending.

In reply to a post by nemeth782:

BT have a few thousand exchanges across the UK. Many of these are rather large (but these days mostly empty) buildings that often have a decent amount of parking space and are in central locations. They could be converted to either flats, or large 6 bed type houses.

If we had universal FTTP, we wouldn't need telephone exchanges anymore.

If we assume FTTP rollout will cost £12bn, and there are ~5600 telephone exchanges, then a selloff of the exchanges could perhaps fund 1/4 to 1/3rd of the rollout.

Would this not make sense?

The larger exchanges could certainly be part-let as office space.

Some of the smaller ones could be eliminated.

Still need physical locations to aggregate the fibre, and unless FTTP were point to point fibre there would also be a need for equipment to fire light down it, and networking hardware to support it.

In reply to a post by panda:

The point was that it was funded centrally by Government, where the expectation now is that a private company should be altruistic and be prepared to make a loss for the benefit of others.

Which is probably no more and no less valid than the view that the government(*) is capable of organising such an expansion programme without wasting money and that, once in place, the government can be trusted to operate and maintain it well (and without wasting money).

Luckily we have examples to guide us from history. Compare/contrast the telephone network as run by the Post Office and now as run by BT. Neither system was perfect but at least I always get dial-tone when I pick my phone up and can almost ignore the price of calls - that wasn't true under the PO. I also have a very respectable internet connection - something I doubt I'd have if we were still struggling under the PO.

And we have one extra datum point to consider when talking about government control of our telecoms. It's called Theresa May.

(*)Or nationalised company, same deal really.

Edited by Andrue (Tue 19-Apr-16 12:07:02)

To be fair, the technology involved didn't exist anywhere in the world when the GPO ran the phone service.

As a technicality, IIRC the Post Office never did run it. It is the other branch formed when the GPO was split into postal and telecoms businesses.

In reply to a post by RobertoS:

As a technicality, IIRC the Post Office never did run it. It is the other branch formed when the GPO was split into postal and telecoms businesses.

The Post Office started its own Telecommunication Business in the late 1870s. Other telcos were nationalised around 1912 an absorbed into it.

In the early 1970s, there was a division of the UK Post Office called Post Office Telecommunications

Actually, although my memory wasn't perfect, the Post Office appears to have been created in 1969, replacing the GPO.

What I forgot was that change preceded the internal split into the two businesses in 1980 and the final split into separate companies in 1981. I was thinking it all happened in 1980/81.

In reply to a post by RobertoS:

To be fair, the technology involved didn't exist anywhere in the world when the GPO ran the phone

Agreed but they didn't seem able to get the funding to deploy the technology they had developed. A lot of clever stuff was developed in their R&D department (there's a video knocking around somewhere from the 70s or maybe even 60s) where they talk about the benefits of FTTP). Great stuff but not a lot of use when the government won't or can't release the funds needed to actually deploy it.

Edit: This isn't the one I was thinking about but it shows what the GPO R&D boffins could do:

https://www.youtube.com/watch?v=3aPZbQF_Du0

Edited by Andrue (Tue 19-Apr-16 13:49:57)

That's getting to around the time Maggie put the mockers on FTTx.

In reply to a post by RobertoS:

That's getting to around the time Maggie put the mockers on FTTx.

A little earlier than that. Wasnt' it BT that approached her and were rebuffed? They claimed they'd roll-out FTTP nation-wide in exchange for a broadcast license. She decided it was better to help let the cable companies set up shop. The jury on that one isn't so much out as 'dead, buried and turned to compost' :-/

Edited by Andrue (Tue 19-Apr-16 13:54:42)

That was STC rather than the GPO/Post Offfice, although I agree with what the GPO boffins could do!

I remember Tomorrow's World showing the wonders of FTTP back then. The business case was based around becoming a TV provider and I believe the argument against it was that if they became a TV provider as well as their other services that they would have too much market power and essentially be a monopoly. And of course monopolies are bad, broadcast license refused, FTTP no longer cost effective...

But, BT did use fibre in Milton Keynes. And when ADSL came along they had to put in a copper overlay to be able to deliver broadband to Milton Keynes...