Fibre broadband to cost £30 billion

 

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Posted on 8 Sep 2008 at 16:21

Deploying fibre optic cable across the UK to underpin a next-generation national broadband network could cost a cool £30 billion, a new report estimates.

The Analysys Mason study conducted for the Broadband Stakeholder Group (BSG) - the government's advisory group on broadband - puts the price of turbo-charging Britain's broadband at between £5.1 billion and £28.8 billion, depending on the technology used.

It is estimated that national deployment of fibre to the cabinet, which is the cheapest technology option - involving laying fibre between telephone exchanges and telco "cabinets" in the street - would cost £5.1bn. This is up to four times more than the telecoms sector spent deploying today's broadband services.

Taking fibre to every UK home, using point to point fibre - the most expensive technology option - would cost as much as £28.8 billion.

The largest single cost component is described as the "civil infrastructure", the cost of laying fibre in new or existing ducts.

The report suggests that these high costs could be "significantly reduced" by the re-use of existing telecommunications ducts; the sharing of alternative infrastructure owned by other utilities, such as water companies; and the use of overhead fibre distribution in some areas.

"The scale of the costs looks daunting but the report does shed light on how some of these costs can be reduced and what the likely extent of commercial rollout will be," said Antony Walker, chief executive of the BSG. "It should focus minds of commercial players, policy makers and regulators on the potential solutions to these challenges."

The report also warns the costs of deploying fibre in rural areas will "far exceed" the costs in urban areas.

"If rural areas are to be served in a reasonable time frame, thinking needs to start now about creative solutions for making them more attractive to investment", said Walker.

Author: Robert Jaques