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BT says ubiquitous broadband needs public finance

Business case 'doesn't stack up'

By Jason Stamper

Steve Robertson, CEO at BT Openreach has been reiterating what the firm has been saying for some time: namely that rolling out fibre broadband to every home in Britain doesn’t stack up as a business model without some public funding.

Robertson repeated BT’s view that public funds would be required were the government to decide that every home in the UK should have access to fibre broadband (as opposed to copper broadband which is already ubiquitous).

The government hasn’t stated explicitly that this is its ambition. BT is investing £2.5bn to roll out fibre to two thirds of homes by 2015 but the final third is far more expensive and trickier to reach according to BT, so in that scenario it "would need" public sector funding to add to its own.

"That’s because the business case for extending fibre to the final third doesn’t stack up (even with supportive funding, it would still be challenging)," BT said. "Such partnerships could be with central government, on a regional basis (e.g. our partnership in Northern Ireland) or on a local basis (e.g. our recent deal in Iwade, Kent)."

"Our view is that rolling out fibre to the final third would cost several billion pounds in total with the public sector’s share probably being in the region of one to two billion pounds. This amount of money would help to release further investment from companies such as BT so the public sector wouldn’t be picking up all of the costs or risk."

Robertson clarified that he has never said BT is "demanding" cash, as some media are reporting.

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