In reply to a post by MrSaffron:

The joy of trying to fasttrack a scheme that is assuming market failure when if the market were left to its own devices this may all be covered in ten years time. In fact I reckon if Openreach were left to its own devices then by 2017-2018 then would be near to 90% coverage anyway.

EU has the same problems arising for many broadband projects underway and not just in the UK. The broadband market and the fibre one in particular is so new, and costs are coming down every few weeks for kit and hardware, refining deployment methods reducing labour costs. That a project that is non-commercial now may very will be in three years

As for you not talking about rural correct, it was someone elses quote, but I like to remind people that the BDUK project is not just rural.

Seems openreach know all about the stopping at a certain line "finite timescales and funding" so those missed now, might still be on their to-do list to do eventually with their own money.

From my first post, albeit an edit when I realised I wasn't entirely accurate:

The BDUK money is meant to fund mostly rural cabinets that are not able to become economic regardless of how much demand is generated, not urban cabinets that can become economic once a certain threshold of committed uptake is reached.

Urban cabinets are supposed to become viable through a combination of increased uptake and incremental cost reduction through upgrade of surrounding cabinets and fibre network though there will, of course, be some exceptions.

Those aren't my words, they're the words of a senior BDUK representative.

So based on this discussion you're happy to agree that the BDUK programme violates state aid rules as it fails the tests of addressing market failure and changing the behaviour of the recipient?

Pleased you clarified the earlier point that:

The market has said commercial projects will stop at 66% so the other 34% are market failure

What you've said above indicates state aid both addressing a market failure that it isn't evident either exists or needs to be corrected, failing the first of the 'balance' criteria, and you've suggested a change in behaviour being induced by the recipient, failing the third of the criteria.

If you want some more evidence of changing behaviour try this - not my email:

Due to the location of 62 I think we can safely assume due to the previous costings this will be forced to go through BDUK bidding though we are still getting indication from private funding that they are happy to contribute towards the £16,000 that was originally requested by BT for the upgrade,

This now seems to turn into a house lottery not even a postcode lottery. There fore would it be viable to arrange another meeting to discuss how we can move this forward at the moment there is such an air of confusion that I think it would be best to meet face to face to resolve this.

Response from Openreach:

Moving forward the five West Yorkshire councils are running a BDUK procurement process that is due to start in November and will include New Forest Village. We do expect to respond to their tender when they issue them. Because of this, we cannot enter into any negotiations outside of this procurement process and as such your request for a meeting is declined.

Enthusiastically agreed to by the partnership director for the area.

The prospect of state aid ensuring that a private company don't want private funding. I'd say that's a pretty big case of altered behaviour, not least because such discussions have been refused as far back as July, well before any procurement process was scheduled to start.

EDIT: I'm waiting on DCMS to confirm whether or not BDUK does preclude discussion on private bids. I've heard nothing indicating that it precludes discussion of private funding prior to the procurement being made, that would be absurd.

Edited by deleted (Sun 18-Nov-12 13:29:28)

"you're happy to agree that the BDUK programme violates state aid rules"

No not happy to be quoted as saying that.

What I am saying is that we are in the position that NO WHERE in the EU has demonstrated market failure for superfast broadband yet, as it has existed for so few years that we do not know exactly where the market will and won't go.

Therefore even the CEF broadband funding is likely to be see same issues as you are now, to the extent that the UK parties are seeing this as a way to fund the final 10%.

If we want to prove beyond any doubt that an area is suffering market failure you need to have finished all commercial roll-outs and have waited a few years. Anything less is fast tracking and runs the risk of the very issues you are talking about.

So you're happy to agree that BDUK violates state aid rules, albeit potentially being given a free pass?

How about the change of behaviour?

I've correspondence from before the local council received notification it would receive BDUK funding and after. Before the partnership director was moderately interested in discussing private funding while afterwards he immediately stopped and requested any further dealings go through the council.

As far as I'm aware 'everyone else is doing it' isn't a legitimate defence of anything.

Without spending a week with a state aid rule lawyer not happy to say that as need to review lots of previous cases to see if they have given approval in similar cases in other areas, in which case there may be no issue.

On the change of behaviour - if BT had announced 75% coverage in 2009 and now scaled it back to 66% yes I would support you, but over a handful of cabinets then don't see the point beyond perhaps bad news creates visitors approach.

I can see the frustrations, but when anything is limited hard choices end up being made and this all too often look arbitrary from the outside, and in a world ruled by a formula in a spreadsheet even more so.

As for the defence thing, see a few projects complaining about state aid delays, and in some cases have heard the commercial bidder has actually started work. Of course the way around this is to only give out small grants which is what Kent County Council and Welsh Assembly have done for a while.

In reply to a post by MrSaffron:

Without spending a week with a state aid rule lawyer not happy to say that as need to review lots of previous cases to see if they have given approval in similar cases in other areas, in which case there may be no issue.

Well it's a very political answer but I'm pleased you took on board the earlier posts and am happy it's not so clear cut.

In reply to a post by MrSaffron:

On the change of behaviour - if BT had announced 75% coverage in 2009 and now scaled it back to 66% yes I would support you, but over a handful of cabinets then don't see the point beyond perhaps bad news creates visitors approach.

It seems a group-wide policy given both Trevor Higgins and Tony Franklin have said it thus far. As soon as BDUK comes on board Openreach cease their programme of commercial review and refuse to discuss private funding. The actual amount of cabinets it affects will be a bit of a mystery.

In reply to a post by MrSaffron:

I can see the frustrations, but when anything is limited hard choices end up being made and this all too often look arbitrary from the outside, and in a world ruled by a formula in a spreadsheet even more so.

I'm looking forward to seeing how that formula holds up. A spreadsheet is only as good as the data going into it.

In reply to a post by MrSaffron:

As for the defence thing, see a few projects complaining about state aid delays, and in some cases have heard the commercial bidder has actually started work. Of course the way around this is to only give out small grants which is what Kent County Council and Welsh Assembly have done for a while.

I've some FOIs in place to try and find out what's behind this.

If this ends up being the case:

The main focus for BT was to get BDUK funding for MK which for some reason they thought would be a huge amount. However, the funding is very very small so they appear to have just opted to get on with it. The BDUK funding will cover NGA for some small Exchanges which arn't as urgent because 99% on those exchange must get more than 2-3 Meg anyway.

That's a big no-no.

What are you trying to found out via FOI? That's a bit unnecessary!

You just have to ask?


Regards,

Gareth

In reply to a post by garethr:

What are you trying to found out via FOI? That's a bit unnecessary!

You just have to ask?

Regards,

Gareth

With all due respect if you don't know what I'm trying to find out it seems a bit presumptuous to suggest an FOI is unnecessary.

Do you have anywhere I can see the mapping data for the cabs? Is the Exchange 21CN/NGA enabled?

Have you actually engaged with exec's in BT? Does your council have regular meetings with BT?

We've had an on going problems with them saying things are not viable then (after a lot of [censored] around) suddenly they'll go ok and announce deployment.

We gave up trying to engage directly with them once we knew all the major areas had dates.

Since then they have started to deploy to areas we've been advised over and over were not viable.

But, we are further into the commercial cycle than other areas. So it will look different to whats going in other parts of the country.

Regards,


Gareth

For the avoidance of doubt the BT commercilal rollout will be complete by spring 2014 - it is outside any BDUK monies and no BDUK monies are spent on commercal deployment cabinets -- decisioing on exchanges and then on individual cabs in deployed exchanges are based on a range fo criteria of which prem count is but one -these are appllied consistently

so to suggest that the busiess was waiting for BDUK money rather than deploy is both factually incorrrect as all exchanages and Cabintes are subject to commercial ctieria and even if the exchnage is enabled all cabs in those deployed exchanges are also subject to futher commercial cirterita. (some will pass and be deployed and some may fail and Will not be commercially deployed regardless of premsies on them. Those that fail witll be identied as White under an OMR amd then it is up to the local authority to determine whether those white areas in enabled exchnages will from part of their intervention area which they will procure on. They can only spend money on White arease but it is their decision to determine how much of that white area they choose to spend money on (this may not be the wholse size of the white area)

In reply to a post by Fastman2:

For the avoidance of doubt the BT commercilal rollout will be complete by spring 2014 - it is outside any BDUK monies and no BDUK monies are spent on commercal deployment cabinets -- decisioing on exchanges and then on individual cabs in deployed exchanges are based on a range fo criteria of which prem count is but one -these are appllied consistently

so to suggest that the busiess was waiting for BDUK money rather than deploy is both factually incorrrect as all exchanages and Cabintes are subject to commercial ctieria and even if the exchnage is enabled all cabs in those deployed exchanges are also subject to futher commercial cirterita. (some will pass and be deployed and some may fail and Will not be commercially deployed regardless of premsies on them. Those that fail witll be identied as White under an OMR amd then it is up to the local authority to determine whether those white areas in enabled exchnages will from part of their intervention area which they will procure on. They can only spend money on White arease but it is their decision to determine how much of that white area they choose to spend money on (this may not be the wholse size of the white area)

Totally agree with that. However, some of what I'm talking about predates BDUK.

Things got pretty confusing. There was a lot of left had and right hand disconnect going on.

The lack of transparency from BT has been the main problem all along.

Regards,

Gareth