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 Tuesday, July 17, 2012

Amid concerns that it is not competitive, the UK’s rural broadband rollout strategy has reportedly been placed on hold while European regulators examine it, British broadsheet The Guardian reports. The development comes after confirmation that just two companies – fixed line incumbent BT and Japanese technology firm Fujitsu – had been selected to receive funding from Broadband Delivery UK (BDUK), a team within the Department for Culture, Media and Sport (DCMS) set up to deliver the government’s broadband strategy. BDUK’s main role is to allocate and distribute GBP530 million (USD829 million) in funding with a view to bringing superfast broadband to the third of UK homes and businesses which are not expected to be provided for by commercial rollouts.

The state had originally aimed for an open process in which community groups and private firms would be commissioned to build Europe’s ‘best superfast broadband network’, with BDUK having published a framework covering 35 local authority areas, under which contractors competed to win equipment supply deals. However, with claims that the selection criteria had proved insurmountable, a number of companies, including Geo and Cable & Wireless withdrew from the process last year.

With both BT and Fujitstu having reportedly signed contracts last Friday for their respective portions of funding, it has been confirmed that no work will move forward until the European Commission is satisfied with the plans. It has been suggested that one of the main concerns with the setup is that BT is unprepared to offer access on a sufficiently open basis to the infrastructure it will roll out, with Brussels thought to want the incumbent to allow rival operators to be able to rent its dark fibre. A BT spokesman was cited as saying of the development: ‘Discussions between the UK government and the commission continue on the issue of state aid. This is an EU issue as the commission is developing rules that need to work across Europe as well as taking the different conditions in the UK into consideration … We are working with the UK authorities for an outcome that both incentivises further investment in fibre broadband and delivers vibrant competition in broadband services … We believe there needs to be consistency with the wider regulatory framework which has given the UK the most competitive broadband environment in the world.’

Source: TeleGeography.