Brexit Opportunities: A Fresh Start for Broadband Provision

8th August 2016

In light of the UK’s historic vote to leave the European Union on 23 June, the UK Government has an opportunity to make a break with the past and drive to a goal of universal broadband availability across the UK. The tightly prescriptive model for broadband deployment handed down from Brussels has – in our direct experience – stifled competition for broadband services, by limiting the ability for SME providers to compete with BT, leading to sub-optimal results in terms of broadband availability and uptake among the population. As the government exits the EU, there is an opportunity to create a new framework for broadband provision, which drives competition by embracing a range of technologies and allows the Government to deliver on the target of reaching 100% of the population by 2020.

Lifting State Aid Restriction

EU State Aid restrictions have created a situation where companies such as WiSpire are excluded from access to funding – and, worse, subjected to publicly subsidised competition from the country’s dominant operator, BT. Instead of basing broadband penetration targets on what incumbent network operators tell them is commercially viable (i.e. that Next Generation Access speeds are necessary), the Government should listen to the needs of UK citizens. For example, the rural population are more concerned about getting decent broadband speeds today, rather than superfast broadband at some unspecified future point. As part of its renegotiation with the EU, we ask that Government unburdens itself from the requirement to follow EU State Aid rules specifically for funding broadband rollout. This will allow the UK to introduce broadband delivery frameworks that are responsive to, and appropriate for, the needs of underserved communities.

Embrace Alternative Technologies

EU regulations have effectively mandated that the UK focus all its resources on fibre deployment, irrespective of whether this technology is appropriate to the needs of the local community. In hard to reach rural areas fibre is extremely uneconomical – a fact which is central to BDUKs problems in getting more people online. Leaving the EU gives the Government a clear opportunity to embrace a wider variety of technologies in its broadband delivery programs. In particular, wireless technologies are inherently better suited to the needs of those currently unconnected by fibre or satellite.

A fresh start

Above all, Brexit gives the Government an opportunity to reset the model for broadband deployment in the UK, which has achieved only modest progress in terms of penetration in recent years, at the cost of the near total collapse of the market for alternative network providers. We call on the Department for Exiting the EU to work closely with colleagues from across Government to ensure that these opportunities are seized upon.