BT to revitalise rural broadband trials

By Matthew Broersma, ZDNet.co.uk, 14 August, 2002 16:23

NEWS

BT Wholesale is trialling a new scheme that could see broadband rolled out to rural areas with as few as 16 high-speed Internet subscribers, the company announced on Wednesday. The move offers a ray of hope to rural users who have previously been unable to get online using anything faster than a dial-up modem, although BT was quick to point out that there is no guarantee of the scheme becoming a commercial offering. The trial involves a new sponsorship business model, and new technology for lowering the cost of providing ADSL broadband, BT said. The UK government has said it will not subsidise the rollout of broadband into rural areas -- a policy contrasting with those of France, Canada and Australia. Instead, BT's test will involve signing on sponsors with an interest in local development: the Highlands and Islands Enterprise; Gwynedd County Council; Denbighshire County Council, together with IT consultants The ITC; the East of England Development Agency; The New Forest Business Partnership; and Omagh District Council. Each body will contribute £7,000 to cover the six-month trial, although BT said this figure should not be seen as indicative of what fees would be for a commercial rollout. The sponsorship scheme partly addresses BT's often-stated reluctance to invest in providing ADSL services in areas where there is little prospect of making back costs. However, BT will also be using new technology to make ADSL services available over local exchanges without the costs of fully upgrading the exchange. A full upgrade can cost as much as £500,000, and BT is requiring that as many as 750 users commit to signing up for ADSL services in some areas before it will upgrade the local exchange. For the new trial, the telco is working with equipment suppliers such as Alcatel and Fujitsu on an lower-cost ADSL equipment that can serve as few as 16 people, rather than the 48- or 64-subscriber capacity of conventional units. BT will also use the ordinary copper cabling that connects the local exchange to the rest of BT's network, rather than replacing it with an expensive fibre-optic connection. To make the arrangement simpler, services will be provided through a single ISP nominated by the sponsor. BT Wholesale spokesman David Orr emphasised that there is no guarantee that the trials -- set to begin this autumn -- will last longer than their allotted six months. "We will see how it works technically and as a business model," he said. "If we produce a product for launch, we have to have all the costs and variables known." While the start-up costs for the trial are lower than for a conventional ADSL exchange upgrade, there remain significant ongoing costs that may not be covered by ADSL subscriptions and sponsorship, BT said.

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