BT confirms £12bn full-fibre rollout plan

Ofcom has published rules governing the rollout of full-fibre broadband (Wholesale Fixed Telecoms Market Review) which it says will set up millions of homes for faster and more reliable broadband by encouraging private investment. Under these rules, the price Ofcom charges telecom providers for its 40Mbit/s copper broadband service will be flattened in line with inflation for the next 10 years, but there will be no price caps on full-fibre connections provided by BT subsidiary Openreach.

Ofcom said that the approach will lead to properties in 70 per cent of the UK having a choice of networks from competitive commercial rollout. 20 per cent of the country will be covered by public funding. Openreach said it will deploy full-fibre to the remaining 10 per cent of homes, which will mostly be in areas in which there is insufficient commercial incentive to encourage the building og new broadband infrastructure.

Oliver Dowden, secretary of state for digital, culture, media, and sport, commented: “We welcome the regulations Ofcom have announced today, which strike the right balance between encouraging commercial investment and protecting consumers.” He said that the government’s “Project Gigabit” plan would be published later this week, and will include details such as the first places to benefit from public funding.

Ofcom’s decision secures BT a 12 per cent profit margin on a £12bn investment – with clarity and certainty over pricing for the next decade – and provides incentive to carry out the rollout as quickly as possible as customers switch to the new full-fibre services.

“This is good news for all fibre providers in the UK. For us, it is the green light we’ve been waiting for to get on and build like fury,” said Philip Hansen, CEO of BT. “Full-fibre broadband will be the foundation of a strong BT for decades to come and a shot in the arm for the UK as we build back better from this pandemic. Connecting the country has never been more vital.”

Clive Selley, head of Openreach, added: “We’ve now passed almost 4.5 million premises and are building faster, at lower cost and higher quality than anyone else in the UK. Today’s regulation will allow us to ramp up to three million premises per year providing vital next generation connectivity for homes and business right across the UK.”

Dame Melanie Dawes, CEO of Ofcom, said: “Over the past year, being connected has never mattered more, but millions of homes are still using the copper lines that were first laid off over 100 years ago. Now it’s time to ramp up the rollout of better broadband across the UK. We’re playing our part, setting the right conditions for companies to step up and invest in the country’s full-fibre future.”