ZDNet UK / News and Analysis / Business of IT / IT Strategy

BT targets leave little hope for rural broadband

By Graeme Wearden, ZDNet.co.uk, 7 August, 2002 12:34

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Topics

BT, ADSL, broadband registration, Rural broadband, pre-registration, rhos-on-sea, trigger levels, ulverston, Broadband

NEWS
Many computer users based in rural parts of Britain have virtually no hope of being offered ADSL-based broadband in the foreseeable future, because BT is insisting on unrealistically high levels of interest before it will deliver the technology to their area. Several small communities learned this week that ADSL will not reach them until at least 750 people in their area pre-register for the service, even though some of these communities contain fewer than 10,000 homes, meaning that in some cases one in 13 homes would have to sign up. One area in Wales would need one in five homes to sign up before BT will upgrade the exchange. BT says it is demanding such high levels of interest because it is particularly expensive to install broadband in the local exchanges in these regions. On Tuesday, BT announced the number of broadband pre-registrations required in 88 locations before it would ADSL-enable the local exchanges. These trigger levels range from 200 pre-registrations up to 750, even though the local exchanges that BT has already upgraded -- which are often in densely populated urban areas -- currently have an average of just 250 broadband users. Rhos-on-Sea, on the coastline of North Wales, is one area that has been given a trigger level of 750 pre-registered orders. According to the latest population figures from Conwy County Borough Council, there only 3,488 homes in Rhos-on-Sea. Since BT started its Web-based broadband pre-registration scheme six weeks ago, just 33 Rhos-on-Sea residents have signed up. Assuming the Rhos-on-Sea telephone exchange serves all these 3,488 homes, and no others, more than 20 percent of households must pre-register for broadband before BT will bring broadband to the area. The current take-up of ADSL in areas where it is already available, though, is less than 2 percent. The situation is little better at Ulverston, in Cumbria. It too has been given a trigger level of 750, despite the fact that this market town consists of just over 5,000 households. BT has installed broadband in 1,115 local exchanges so far. These exchanges are the ones where BT believes it is sufficient demand for broadband to justify the cost of upgrading the exchange, This means that some 15 million homes could sign up for ADSL-based broadband, but despite BT's policy of targeting areas of maximum demand it has only around 280,000 ADSL-end users -- a take-up rate of around 1.837 percent, and an average of 250 users per exchange. It is pretty much inconceivable that 20 percent of rural homes will be prepared to sign up for broadband, as is required in areas such as Rhos-on-Sea, given broadband take-up of under 2 percent in places were BT has repeatedly said there is higher demand. A total of 17 local exchanges were set trigger levels of 750, with ten being set at 700 and eight at 650. A BT spokesman told ZDNet UK that these levels are the equivalent of between seven percent and 15 percent of lines being pre-registered for broadband. Because some homes have two phone lines, the percentage of household registrations needed could be slightly higher, he added. Residents of Rhos-on-Sea and Ulverston may be hoping that the numbers are swelled by people who live just outside the area but are connected to their phone exchange. Unfortunately, rate-adaptive DSL only works if a user lives within 5.5km of the local exchange, so more remote residents probably wouldn't be able to get broadband even if it were available. BT also said that it has set trigger levels of just 200 pre-registrations for 53 exchanges, because it is cheaper to install installing ADSL equipment in these local exchanges and connect them to BT's main high-speed network. "We have set trigger levels that reflect the true cost of installing ADSL in these exchanges. We do recognise that some of them are high, and it might be some time before they are reached," the BT spokesman said. "We are also working on a number of ways, both through technology and funding, to try and reduce the cost of broadband provision," he added. BT is aiming for one million broadband users by summer 2003, and a total of five million by 2006. Should these targets be hit, it is quite possible that the cost of broadband infrastructure could be driven down, making broadband rollout in rural areas more affordable. The cost of installing ADSL in an exchange can reach £500,000, according to reports. As a commercial company with a responsibility to its shareholders, BT cannot be expected to shoulder the cost of installing broadband in areas where it may never see a return on investment. This is why many people in the telecoms industry would like to see the government providing the money needed to drive the rollout of ADSL in rural areas. The UK government's policy, as e-commerce minister Stephen Timms told ZDNet in June, is to let the market drive the rollout of broadband. In contrast, governments in France, Canada and Australia have all provided large sums of money to subsidise the rollout of broadband in rural areas. "At the moment, it is not felt that financial intervention is warranted, as it has the potential to distort the market," a DTI spokeswoman told ZDNet News People connected to the local exchangers in Rhos-on-Sea, Ulverston, Skegness, Milford Haven, Caldicot, Bridgnorth, Fraserburgh, Cockermouth, Hexham, Stockbridge, Brimscombe, South Wootton, Oakham, Seaton Delaval, Cudworth, Darton and Pagham - which all have trigger levels of 750 - are now experiencing the downside of the UK government policy. Timms recently announced a number of initiatives to try and improve the take-up of broadband, including regional broadband advisors and a team to help public sector bodies buy broadband. A key part of the government's broadband strategy is the hope that public-sector demand for broadband can be used to drive the rollout in rural areas, by showing there is enough demand in an area for a telecoms firm such as BT to install broadband.
See the Broadband News Section for the latest on cable modems, ADSL, satellite and other high-speed access technologies, including a comprehensive guide to the best deals out there. Have your say instantly, and see what others have said. Go to the Telecoms forum. Let the editors know what you think in the Mailroom.

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