The BT Group has published its latest set of financial results, which cover the nine months up to the 31st December 2009.
Ian Livingston, Chief Executive, commented, “These results show that we are making progress. There is still a lot more to be done but our commitment to improved customer service and cost transformation is starting to deliver results and freeing up resources to invest in our future. In particular, we are one of Europe’s largest investors in super-fast fibre-based broadband and this will bring huge benefits to our customers and the UK.”
The various parts of the BT Group that most directly affect broadband being Openreach, Wholesale and Retail all appear to have had a tough time, or as the results suggest ‘challenging market conditions’, overall group revenue was down some 4%.
BT Retail saw the trend of reducing calls and line revenue continue, some of this probably from people switching to other call providers and line rental deals, but another factor is the increasing amount of fixed cost call packages available. BT Vision had some 451,000 customers at the end of December 2009, and the results highlight the Project Canvas project as well as the possibility of wholesale access to Sky Sports and Movies which may boost the customer numbers for BT Vision. Retail had 102,000 net additions in the quarter taking its number of broadband customers to over 5 million.

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Today the government launched a consultation to decide how money from the Next Generation Fund should be spent. The 50p levy on all telephone lines is the source of the funds and is expected to raise around £175m a year, with £1 billion of this to be used by the government to help provide super-fast broadband to 90% of the country by 2017. It is estimated that without the use of the fund, next generation broadband, currently available to 50% of the population, would only reach 70% of the country.
According to Lord Mandelson, Business Secretary, “This investment is about bringing the future of broadband to areas of the country that would otherwise miss out. We cannot underestimate the opportunities this will bring for homes and businesses which is why we are taking action to make sure everyone benefits.
“Already the market is delivering superfast internet speeds of 50Mbps to half the country but we cannot be certain that it will reach the communities that are not currently served, which is why we are putting in an extra £1billion to support the market.
“By upgrading our networks we will put the UK at the fore of rapidly developing technologies which will bring jobs, boost business potential and grow our digital economy.”
The government is evaluating different Next Generation Access (NGA) technologies, including Fibre to the Cabinet, Fibre to the Home, Satellite, WiMAX and Long Term Evolution, which may be viable options. Right now, it is uncertain when things like Long Term Evolution will be available, so fixed line solutions seem like the best option in the short term.
The government are also intending that where money is provided, it should be used to fund an ‘open access’ network. This would of course mean that it would work in a similar way to existing fixed-line broadband from BT where providers can sell their own broadband services over the BT deployed network, helping to give consumers a choice and produce some competition to the market.
The consultation can be read in full on the Department for Business Innovation & Skills website, and is open for responses until 01/04/10.

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Point Topic has published a new report coining the phrase ‘Superband’ to refer to the Next Generation Broadband services appearing across the UK. The report suggests that broadband at 25Mbps and faster will be available to 2 million homes by the end of 2010, though they are ignoring the DOCSIS 3.0 fibre/coax hybrid network from Virgin Media in this figure, which gives the option of 50Meg to around 45% of UK households.
The two million households covers around 30 projects such as BT and other alternate network projects, though the issue with pretty much all of these is that so few people are connected to any of these projects. The current numbers will make a lot of people laugh, estimates suggest that these 30 projects had about 3000 lines actually connected at the end of 2009, with BT accounting for 1250 of these.
In short fibre roll-outs are happening, but the actual situation is not unlike that of 1998/1999 when BT was running a very small trial of ADSL that meant only a handful of people had the service. Some of the fibre projects mentioned by Point Topic are Independent Fibre Networks in Corby, Swindon and Andover, IsRightHere in Liverpool and Chelsea and Velocity1 in Wembley. H2O Fibrecity is fibering up Bournemouth with Dundee next on the list.
H2O Networks is a classic example, as we see reports from people in the area of work progressing, and we believe homes are connected, but as yet no positive sign of anyone with Internet access. Last we heard in 2009 was that a retail Internet Service Provider had been signed up, but H2O was unable to say who it was.
Things in theory are set to accelerate. Digital Region in South Yorkshire should have a good chunk of its 600,000 homes connected by 2011, and the BT FTTC wholesale product will be available to around 1.5 million homes by then. While this looks like good progress, if we compare this to Sweden 38% (1.2 million lines) of Swedish broadband connections are over fibre, so we are behind the leading edge.
While not purely a superband issue, adoption of BT Wholesale’s WBC product range does seem slow amongst broadband providers, possibly because apart from BT Retail, all the big providers have their own LLU network already offering ADSL2+ in the same areas and the investment needed both in terms of switching networks and training support staff means that many small and medium sized providers are perhaps reluctant to rush into the product. The adoption of WBC is critical to making sure that the Openreach FTTC products are widely available, and the LLU operators who in theory can take an uncontended Ethernet handover from Openreach appear too slow to adopt, possibly due to the lack of control of the actual VDSL2 kit in the cabinet and customers home.

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YouTube, the Google owned video-sharing website, will now be offering movies to rent. Initially, only five films will be available, and these are only to users in the US. These movies are from the 2009 and 2010 Sundance Film Festival and 4 out of 5 of the films will cost $3.99, around £2.50. After this initial launch, YouTube is expected to get some bigger Hollywood names on board who will be happy to offer their movies to a wider audience.
YouTube does have a major competitor in Hulu, which is a joint venture between NBC, Universal, Fox and ABC and offers TV and films from the major US studios. Currently, Hulu only offers content in the US, but was expected to make a launch in the UK in September 2009. They couldn’t get a major UK TV broadcaster on board in time, so this was delayed. With 4oD and Five on demand now available from YouTube in the UK, Hulu will definitely have to compete hard in the UK, and bringing TV and movie content from its parent companies may help it do so.
The longer users in the UK have to wait for viable services to be available, the more they will turn to alternative ways to get the content they want, such as P2P and file sharing websites. Some services are starting to appear, if you have the right equipment to get them. Sony launched the European PS3 video store in November 2009, which offers over 2000 films for rent or purchase with prices from $1.99 or around £1.75.

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BT Retail has announced for the fibre to the cabinet/fibre to the home (FTTC/FTTH) based broadband services, marketed as ‘BT Infinity’. These new products will bring faster download and upload speeds to users and will be available to order from January 25th, if your area has been upgraded for it. Users can check their area availability on the BT website.
Download speeds will be at up to 40Mbps and this will be available at £19.99 a month with a 20GB usage limit. A £50 connection fee applies. The unlimited usage variant will cost £24.99 a month, but does save you the £50 connection fee. It also increases the upload speed from 2Mbps to 10Mbps.
Both products do come with a fair usage policy. Details of this will be released on the 25th of January, but we home that as the products are marketed with usages such as “simultaneous use of services such as HD catch-up on TV” this does reflect the higher usage that may occur.
Gavin Patterson, CEO of BT Retail said: “The internet is essential to our customers’ lives and they are demanding more and more as richer and even more compelling services become available. BT Infinity gives customers the capacity and reliability they need in an instant and at a great value price they can afford. We want to give our customers the best possible online experience and are committed to rolling out super-fast speeds across the UK.”
The product is competitively priced when compared to Virgin who offers 50meg broadband over their cable network for £38, or £28 if you also have a phone line with them. It is worth noting that with Virgin, your line will always connect at 50meg but you may not get this speed due to congestion in the Virgin network. With BT’s 40meg Infinity service, your line may not connect at this 40meg speed due to distance from the roadside cabinet, and you may also suffer congestion within the BT’s network.

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Broadband providers sometimes have something of a battle on their hands figuring out whether when a customer contacts them complaining of an intermittent problem with their ADSL or ADSL2+ service where the fault lies. Very often the voice side of the telephone line will be functioning fine, and traditionally this is when a Special Faults Investigation visit would be booked, which carries the understanding that if the fault is found to be with the customers equipment, e.g. ADSL modem or extension wiring then the visit will be charged. According to a draft Openreach document, this existing SFI visit looks set to be replaced by a service called SFI2 which will always carry a chargeable call out fee. The actual SFI2 product is expected to appear in February 2010.
In theory this SFI2 type visit should only be needed when the line is working according to the specification (defined in SIN 349 and Openreach’s line test system says everything is OK. Alas this does not cover all types of faults, and particularly with intermittent faults which may not show up when Openreach does its testing. This means there is the possibility that a provider and hence the consumer may get charged for multiple visits, and as two types of booking are possible, i.e. one that looks at external network and one including a visit to the consumers home, the scope for people getting a big bill with little understanding of why are very evident.
One of the big problems here is that with the current rules there is no way for providers to verify the results of testing by Openreach engineers, i.e. no independent third party testing system exists, thus we may see local loop faults that Openreach are meant to fix only being fixed after multiple SFI2 visits.

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Yesterday, CCS Insight issued a report that shows the UK is leading the way to cheap mobile broadband in Europe. Of the five leading markets, the UK was the lowest, compared to France, Germany, Italy and Spain. The UK has brought down average prices for mobile broadband to around €17 (£15.20). The country with the highest broadband cost was France, where 4GB of data can cost as much as €85 (£76), but on average users pay twice as much as in the UK.
In these five major European markets, broadband subscribers are expected to rise from 22 million at the end of 2009 to over 43 million in 2011 with revenue rising from €6 billion to €11 billion over the same period. Although most mobile broadband providers charge a flat rate fee for a set amount of usage, in Italy, most tariffs charge on a time-based model. However, this is expected to change somewhat in 2010 with these operators following the trends of their European counterparts.
The prediction of the GSM Association is that this coming growth will help boost the technologies used for mobile broadband which will provide users with better services.
“As the GSM family of technologies continues to evolve and we see increased deployments of HSPA+ and LTE networks, mobile broadband users will experience even faster data rates, more than sufficient to compete with fixed line broadband offerings.”

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Broadband provider BE has announced the launch of their line bonding service which will be available from early February. There have been delays in this product coming to fruition and this is somewhat reflected in the launch. BE will be taking a soft approach, with the product being available only to existing Pro customers. The development time has been costly, so it will not be a cheap service. Pro customers will be offered a discounted price of around £50 to £55 a month with the connection fee around £85. Customers will also be required to have a second BT phone line to provide the service.
The product is designed to provide about double the current broadband speeds. For instance, if you get around 20megs now on BE broadband, you can expect about 40meg, and about 5meg for upload speeds. You will also have two lines, so that if there is a problem on one line, you sill still remain connected on the other.
Those interested in the service should register for it, as the service will only be available to a few customers to begin with, however, it will be available anywhere in the BE network.
If you do not live in a BE broadband area, you can still get bonding services from other ISPs. Timico and AAISP offer bonded solutions using BT lines, with AAISP also able to give a redundant connection using a BT and BE wholesale line.

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Tiscali UK no longer exists. TalkTalk today rebranded Tiscali to TalkTalk.
TalkTalk bought Tiscali UK at a bargain price of £236 million last year after their original offer of £550m was rejected by Tiscali. This was just before the financial problems beset the country. This move made the largest residential broadband provider in the UK under the Carphone Warehouse umbrella, which also owns TalkTalk, AOL and Opal brands.
Charles Dunstone, CEO, Carphone Warehouse said, “We want to make it very clear that being part of TalkTalk is much more than just having a different logo on the top of your bill. For that reason we’ve reviewed all of the pricing tariffs and can say from today that if you’re with TalkTalk you’re getting the same value as your fellow customers. “For many of our customers this will mean a reduction in their monthly bills, others will see no change with the remainder getting a small increase. Any customer visiting our website can clearly see our tariffs. “We’ve gained a lot from the Tiscali acquisition, most notably TV and Portal expertise and some great people, but from today the brand name will disappear and our focus is on TalkTalk.”
This is both good and bad news for Tiscali customers. Some will see price reductions on their service, but others may see a price rise if they do not take the TalkTalk phone line rental service. ISP Plusnet noticed this and they are offering Tiscali customers a special 3 months free offer if they move to Plusnet by the end of January. Interested users should check where they stand in terms of a contract with Tiscali/TalkTalk, as early termination of the contract may incur charges.

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The Joint Select Committee on Human Rights has raised concerns over the technical measures that are intended to be implemented, stating that the Digital Economy Bill could breach human rights of internet users. According to the bill, users who fall foul of the “three-strikes rule” for illegal file sharing could either be disconnected or have their speed severely limited.
Andrew Dismore MP, (Chairman) Joint Committee on Human Rights stated, “The concern we have with this Bill is that it lacks detail. It has been difficult, even in the narrow area we have focussed on, to get a clear picture of the scope and impact of the provisions.”
The committee is seeking further information on the way these technical measures to limit usage of users will be used.
Readers may remember that similar concerns were raised in France where the French Constitutional Council blocked the HADOPI law which was being pushed through by President Sarkozy and backed by the entertainment industry. Concerns there were that it would block the right for people to exercise freedom of expression and communication, part of the founding principles of a democracy.
The government should be ready for a fight about this, as the changes being proposed are a drastic change in how things have worked so far on the Internet. A blanket right for government to rewrite copyright law on a whim has drawn serious concern from many large voices including the likes of Google and Yahoo. Any changes that are to be implemented need to be well defined, clear and concise, the detail which so far seems to be distinctly lacking from the Digital Economy Bill.

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