BT seals the deal on Cumbrian broadband contract
Overall £51m value is less than bidders had hoped
BT has sealed a deal with Cumbria County Council to provide fibre broadband to around 93 percent of homes and businesses in the region – although the value of the contract is less than previously thought.
Cumbria was selected by the government as a pilot to demonstrate to others how to procure superfast broadband almost two years ago, but has experienced a number of significant setbacks. Many other local authorities are now ahead of Cumbria in procuring superfast broadband.
Initial bids from BT and Fujitsu were rejected by councillors in June who claimed that neither submission fulfilled the requirements of the procurement process, which eventually resulted in Fujitsu pulling out of the second round of bidding altogether.
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Cumbria County Council finally accepted a revised submission from BT in September. At that time it was reported that the deal was likely to exceed £70m. However, BT confirmed today that the value of the contract is £51m.
BT will contribute £15m to the project with £17.1m coming from Broadband Development UK (BDUK), £13.7m from the European Regional Development Fund (ERDF) and £5m through the Performance Reward Grant (PRG) from all councils in Cumbria.
On top of this, additional ERDF and PRG funding will contribute to the roll-out and marketing of fibre broadband in Cumbria.
“The 70m figure was used previously when talking about the total estimated level of investment in broadband in the county – not just the BT contract,” said Gareth Cosslett, strategic communications adviser for Cumbria County Council, in an email to Techworld.
“Obviously there's also commercial rollout and not all of the funding from the various grants is included in the BT contract. But for the sake of today, we used 51m as that's what the contract we signed today is worth.”
Cumbria will be one of the first regions to benefit from the EU decision to grant state aid approval for the government’s national broadband rollout. Once government approval for state aid and confirmation of EU Major Project status is given, the government and European funding for the project can be released.
“Although we’re still awaiting the final green light from government, signing this contract is a clear message that Cumbria is ready for action,” said Councillor Elizabeth Mallinson, Cumbria County Council’s Cabinet member with lead responsibility for Connecting Cumbria
“We have a tremendously exciting three years ahead of us, but I would ask people to be patient and allow us to deliver this huge programme in a strategic way which is in the best interests of the county as a whole. The hard work starts now and we need to work together so that by the end of 2015 Cumbria has one of the best fibre networks in Europe.”
BT Openreach will now begin working with telecoms engineers, surveying locations around the county and analysing the best way to roll out the network. This initial survey will take around three months, so Connecting Cumbria should be in a position to announce which communities will be in the first stage of the roll-out in Spring 2013.
BT’s network will be open to all communications providers on a wholesale basis, meaning that a range of ISPs will be able to offer speeds of up to 80Mbps to a majority of the county’s homes and businesses by the end of 2015.
Those premises in the remaining seven percent who currently have very poor internet speeds should also see an uplift, as the project aims to deliver a minimum of 2Mbps or more to almost all homes and businesses.
“Cumbria’s scattered population combined with its comparatively large size and challenging geography, means that small business plays a pivotal role in the county’s economy and the rollout of fibre broadband will act as an economic driver for those rural businesses,” said Bill Murphy, Managing Director of BT Next Generation Access.