Revolution in UK is paramount to deliver broadband consensus

BT, the UK’s former incumbent operator, has a particular preference when investing to avoid ripping out the copper cabling that represents for most people the final connection between the network and their homes.

This may be antiquated stuff and not the best medium through which to transmit broadband signals. But heavily depreciated copper infrastructure still generates healthy short-term returns. So when it comes to the next generation of “ultrafast” broadband, BT doesn’t want to rewire the country expensively with new fibre. Instead it wants to introduce a make-do-and-mend technology, “G.fast”, which preserves the copper link, while allowing broadband to flow rather faster. This might raise speeds. But it will not deliver the sort of uniform ultra-fast service available in countries such as Japan and South Korea, where speeds of 1 gigabit per second are the norm. G.fast might be a clever way of wringing more value out of an elderly network. But it’s also a stopgap. It doesn’t ultimately avoid the need for fibre; it just staves it off for a few more years. BT does not mind the deferral. Britain could have more if the incumbent was forced to open up its “ducts” — effectively the holes in the ground through which its cables link exchanges to homes. Instead of buying space on BT’s own copper cables, rivals could lay their own, thus creating end-to-end networks. While the existing regulations theoretically allow this, the procedures are costly and take too long.

The threat of having its juiciest areas “cherry-picked” by rivals would force Openreach to do more than simply shove in G.fast willy-nilly. It would have to listen to its customer-operators — and offer fibre if that is what they wanted. Ultimately, the risk of losing business to rivals might precipitate the very split that BT’s rivals desire.