Tuesday, October 10, 2017

Existing fibre business rate regime under EU microscope again

The business rates levied on fibre infrastructure and the allegations that the existing regime favours BT compared to its various rivals has been looked at before by the competition regulator in Europe but it appears according to a letter The Telegraph has apparently seen that the UK Government may end up having to justify the system once more.

No formal investigation has been launched yet but this all depends on the response from Westminster and the precise wording of the complaint that has kick started this process again, if the complaint is identical to previous ones then it is likely to be fizzle out quickly.

The UK Government is planning a five year long holiday for business rates on new fibre infrastructure with new being defined as anything built in April 2017 and later, so while it seems this complaint is not linked to that and extended investigation may lead to delays and if the EU was to rule that the existing fibre rate regime was considered State Aid the whole system may need re-writing.

The five year business rates holiday has been widely welcomed as it will likely encourage more full fibre deployment to consumers and businesses and encourage even more cities and towns to deploy metro fibre networks, but for existing fibre network owners there is the small matter of the rates on existing networks going up in price.

The race to play catch-up with full fibre compared to countries like Spain is seen by some as critical to the UK digital infrastructure and so while the UK is behind if your only metric is premises passed by full fibre, in terms of people with access and also buying a connection that fits into the UK or EU definitions of superfast it is doing very well.

London is often held up as evidence of the failure of BT Group to roll-out full fibre, and with 1.9% of London premises passed by the GEA-FTTP service it is below the level of Wales. The bit that people rarely see is that when you add the full fibre coverage from all the providers across London the figure rises to 5.3% i.e. Openreach GEA-FTTP is less than half the full fibre in London. NOTE: These figures do not include coverage from business grade fibre leased lines or Fibre on Demand so the effects from business voucher schemes will generally not be visible. Oh and don't forget that 68% of London has access to DOCSIS cable so product options of 200 and 300 Mbps with 350 Mbps as a business option.


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