How level is the levelling up playing field?

By Sarah Mills
Sarah Mills, Chief Revenue Officer at Neos Networks explains the 'levelling up' agenda for telecommunications companies, saying it goes above expectations.

Inequalities across the social, geographic, and public infrastructure spectrum means that we now have a front bench Government minister and department responsible for the levelling up agenda.  This year saw the publication of a 332-page Government White Paper detailing policy initiatives designed to address the issues.

Of course, during the last two lockdown years, the move to home working and schooling has served to shine a spotlight on connectivity and exposed the extent of the UK’s digital divide – the disparity between the haves and have nots in terms of access to high-speed internet connectivity. It should come as no surprise therefore that one of the paper’s six ‘capital’ projects concerns infrastructure. It might be more surprising that the section on broadband and mobile infrastructure covers just three pages.

There’s no doubt that fibre infrastructure and access should be part of the levelling up agenda, and that it is especially important for regional businesses and rural consumers. And we must also acknowledge and welcome the existing Government funding initiatives that are designed to help make it happen. As the new white paper points out, back in 2020, the Government committed some £5bn in public funding to roll-out Gigabit connectivity to at least 85 per cent of the country by 2025. Often referred to as the AltNet fund, this money was seen as a pledge to support the delivery of Gigabit networks in the 20 per cent of the country that is most difficult to reach.

However, the task the Government set itself isn’t easy. A January report by the Public Accounts Committee – set up to oversee public spending – found the Government was in danger of falling behind in its targets because it was too heavily reliant on the biggest players, Openreach and Virgin Media, to deliver the connectivity.  The report says those two companies are focused on the less costly, easier to reach urban conurbations meaning that the Government was, so far, failing to deliver on the promise to provide affordable solutions for rural areas and remote towns and villages.   

Perhaps, however, a less obvious reason for the slow progress exists in the background. Simply put, not all potential suppliers of broadband infrastructure are treated equally by existing planning legislation. Some ‘designated’ communications network operators have permitted development rights enabling them to install roadside broadband cabinets, build mobile masts or erect telephone poles without the need to obtain planning permission. In many cases, poles carrying cables over private land don’t even require the prior permission of the landowner – their ‘flyover’ rights exist. 

In December last year, the House of Commons Library published a research paper, “Building Broadband and Mobile Networks” that outlined for MPs the current challenges and legislative framework covering how networks are built - including planning requirements and access agreements.

The paper clearly states that while the potential broadband and mobile operators argue that they are ready and willing to invest in new infrastructure, there are barriers that are delaying their ability to build that infrastructure at the speed needed to meet the Government’s targets.

Broadly, the paper says, those barriers relate to the ease of securing planning permission, negotiating agreements to access private land, the accessibility of existing infrastructure, and co-ordination with local authorities.  Obtaining those access agreements and wayleaves, is often a difficult and long-winded process – up to two years in some cases - for all but the incumbent national suppliers.

The Electronic Communications Code (ECC) is the main law governing the rights of telecommunications companies to install infrastructure on private and public land. In January last year, the Government opened a consultation on reforms to the ECC to support the plans for digital infrastructure roll-out, and in November – on the day it published its response to the consultation process – it also introduced the Product Security and Telecommunications Infrastructure Bill into Parliament.  The bill includes some, but not all, of the reforms proposed to the ECC as a result of the consultation, concentrating on areas such as land valuation and compensation.

It is increasingly apparent that broadband infrastructure plays a key role in the Government’s aim to ‘level-up’ the UK. Indeed, the new white paper’s opening statement regarding digital connectivity says the COVID-19 pandemic “demonstrated the importance of digital infrastructure right across society, from ensuring business continuity to reducing isolation”.

Rolling out this infrastructure at speed, will require more than just the usual national suppliers – the £5bn AltNet fund is effectively recognition of that requirement. However, while some suppliers are able to move at speed without the need to negotiate the permissions, access rights and wayleaves required by the independents – others face speed bumps that slow down the roll-out.

More bumps can be found in Ofcom’s 2021 ruling making Openreach free from further wholesale regulation. This has led to Openreach requiring the AltNets to self-validate orders when aggregating Openreach connectivity. The resulting additional fees create more challenges for the AltNets and further slow the effectiveness of the Project Gigabit plan.

It seems, that when it comes to ‘levelling-up’, there’s an argument that it should apply to the challenger companies in the telecoms infrastructure supplier community as well. Levelling the supply playing field will help to accelerate the Gigabit roll-out and advance the Government’s plans.

 

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