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August 3, 2015

Q&A: UK needs a high fibre diet, not HS2

C-level briefing: Piers Daniell, MD of Fluidata, believes the money being spent on the HS2 should be used to deploy fiber broadband nationwide.

By Joao Lima

By 2026, the UK is expected to have built an ultra modern high-speed railway line connecting London Euston to Birmingham Curzon Street station, with further expansion planned to expand the High Speed 2 (HS2) project up north to Manchester, Sheffield, Leeds, and eventually Scotland.

CBR’s Joao Lima met with Piers Daniell, founder and MD of Fluidata, a data delivery network, to discuss broadband speeds and the potential end of London as the only main economic hub in the UK.

Daniell said that the demand to sort out the low broadband speeds is coming, but it is like "our infrastructure as a country".

"We never built the motorways that Europe built, for example. If we look at the UK (for example Wales or Cornwall), they are not business centres because the infrastructure is not there to support that.

"I am actually a great believer that if we use the money from HS2, instead of doing a rail line between London and Birmingham, to bring fiber infrastructure in[to those places], we will actually reduce people’s need for travel in the first place anyway."

The MD added that if people are able to work from home, doing call centre’s duties and "loads of other roles that do not need an office", this will mitigate travel needs overall.

He said that it could also potentially create new economic clusters like London, by using the estimated £43 billion project funds (estimated by the Department for Transport), to modernise the country’s broadband infrastructure.

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Daniell also mentioned BT’s incentive not to upgrade to fiber. "Because while they can charge consumers £16 for a landline to access the internet", they will do it. "People would drop the landline if they had fiber."

"It is going to take five to ten years for us to start seeing a bigger adoption of fiber, but once we start pushing for speeds in the gigabytes plus range, then companies like BT will have to either evolve and change, or they are going to struggle."

Targeting £100m revenues

Daniell himself works from home and struggles with the average 2Mbps broadband speeds that he gets in his house outside London.

The company is hungry for growth and expansion with the MD unveiling that they "will probably look at a data centre [of their own] in the next year or so". "If there is an opportunity, then definitely is something we can explore and look to grow."

The company currently has 18 UK data centres in their network, including Equinix’s LD5 Tier 4 facility in Slough.

That growth has set Daniell to aim for £100 million revenues, which he believes is achievable, especially with SCC on board.

"It is going to be a few years, our revenues are recurrent. If we sign a customer today, we only get to bill them monthly. It takes a long time to build those revenues. There is a lot of potential growth for us."

He also revealed to CBR that the company is looking to expand its footprint outside the UK. "It might not be with an office, but definitely [we will expand] networks wise to give us more capability."

Asking him about potential destinations, the MD said "location will depend on where customers are", but "probably Europe". "Amsterdam, Frankfurt and Paris are good pops. The problem with Europe and America, is that they do not have the diversity of suppliers that we have here in the UK.

"The UK is quite unique as a market place. People think of the UK being really backwards, but actually it is an open book. There is lot of different networks and providers.

"We might not be South Korea in terms of connectivity, but we are very good. Even America is quite far behind."

Tech challenges

Following from this, the MD went on to explain how Fluidata is overcoming challenges as the company "does not own the technology on the ground".

"For us is all about bringing the different benefits of each technology together and deliver a service to the customer."

Something Fluidata has been working on is around bonding; taking lines from different suppliers and bonding them together to deliver the customer one service. Daniell explained that the firm uses Cisco’s hardware, and has developed its own software to make that work.

"Over copper we can deliver 200Mbps nationally, which makes a difference outside the main metropolitan centres.

"Another thing we are working hard on is around automation. One thing in our industry that is really bad, is that everything is manual."

In March this year, IT services provider SCC took on an undisclosed stake of Fluidata. "We started talking about a year ago on an opportunity to work together."

Fluidata has about 1000 customers; SCC has "less but bigger customers". The independent technology solutions provider works with companies like BA, but also has partnerships with Apple, Cisco, EMC, IBM, Microsoft, and several other tech titans.

"All those customers are a potential target for us."

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