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BT, Vodafone come to blows at Connected Britain 2016, as key industry stakeholders share opinions on regulation, high-speed broadband, 5G and other hot topics.
The mere presence of regulatory and policy executives from BT and Vodafone on the same panel at this year’s Connected Britain event led us to suspect that there would be fireworks, and we were not wrong.
Indeed, there was some sparring between Julian Ashworth, director of group industry policy at BT, and Matthew Braovac, head of competition and regulatory affairs at Vodafone UK, before either had been invited on stage, and once they had taken their seats – not next to one another, incidentally – it was clear from the start that this would not be a harmonious half hour.
"Ofcom have assumed their normal position between them," session moderator Matthew Evans, CEO of the Broadband Stakeholder Group, remarked as Andy Hudson, the U.K. regulator’s director of spectrum policy, took the buffer seat.
While Ashworth and Braovac had comments to make on the subject of spectrum, it was the thorny issue of fibre network rollout that truly divided them.
Vodafone needs more fibre, Braovac said, "much more fibre, much further out in the network." There are altnets deploying fibre, but "at the moment I don’t see BT working on that problem," he said, noting that the incumbent has taken a "mend and make do" approach to its fixed infrastructure.
There is a fundamental difference between the copper-based superfast broadband favoured by BT and future-proof fibre-based ultrafast broadband, he said.
BT aims to reach 12 million homes and businesses with what it calls ultrafast broadband by the end of 2020, the majority of which – 10 million – will be via copper-based G.fast technology, the remainder fibre-to-the-premises (FTTP). On a related note, Openreach CEO Clive Selley this week revealed the first nine locations that will have access to its FTTP product for small and medium-sized enterprises later this year.
Ashworth naturally talked up BT’s "mixed economy approach" to serving the U.K. market and defended the regulatory framework in the country that has led to BT having the lowest market share among European incumbents and facilitated investment by rival players; he identified Virgin Media’s Project Lightning network infill plan and various fibre rollout projects by alternative players, in particular.
"I would welcome Vodafone’s plans for how it would invest itself," Ashworth said, responding to Braovac’s assertion that the mobile group is effectively blocked from rolling out its own fixed infrastructure in its home market.
"I don’t think the current regulatory framework supports it," Braovac said. To gain duct and pole access to enable fibre build-out, companies have to send a letter to BT and pay £75 per hour for someone to retrieve the required documentation, which often turns up in an unreadable and out-of-date format, he said.
As such, Vodafone’s fixed-line business plan includes using the Cable & Wireless assets it acquired in 2012 as well as buying capacity from Openreach, an entity it would like to see legally separated from BT.
"We would like to see an Openreach focused just on network," he said, triggering an immediate response from Ashworth.
"That’s all [Openreach] does," he insisted.
The BT/Vodafone head-to-head was far from the only time the Openreach debate reared its head at Connected Britain.
"A separated Openreach would be much better for the country," said Nick Delfas, a partner at Redburn, while conversely HSBC’s head of global telecoms, media and technology research Stephen Howard admitted to being "disappointed" that Ofcom has not completely ruled out such a move, noting that investors would be sceptical about the impact of structural separation.
Meanwhile, Vodafone is not the only company concerned about fibre access in the U.K.
"Please stop calling FTTC (fibre-to-the-cabinet) ‘fibre’ because it puts a cap on ambition," said Dana Tobak, founder and CEO of fibre-to-the-building (FTTB) network operator Hyperoptic.
"The U.K. is nearly bottom of the league for FTTP (fibre-to-the-premises), but then you have BT come in and say we’ve got the fastest speeds across Europe," she said.
Indeed, Openreach’s Selley made exactly that assertion, as did the U.K.’s Minister of Culture and the Digital Economy Ed Vaizey at the event’s opening keynote. "We are already ahead of the other big five countries in Europe," Vaizey said. The U.K. has "faster rollout, higher take-up and lower prices," than Germany, France, Spain and Italy.
Leadership in Europe is not enough for Nokia though. The vendor’s U.K. and Ireland CEO Cormac Whelan suggested that the U.K. should be looking at "leapfrogging" Asia’s advanced markets rather than focusing on its European neighbours.
Some telcos are looking to Asia for inspiration. O2 UK CTO Brendan O’Reilly shared his experience of South Korean capital Seoul, where connectivity has arguably taken precedence over aesthetics.
"Seoul is the smartest city in the world; it is not a beautiful city. You can see the antennas," he said.
The U.K. has taken the opposite approach, with planners often rejecting applications for masts and cell sites on appearance grounds, which makes life difficult for mobile operators.
Indeed, as Phil Sheppard, director of network strategy at rival player 3UK pointed out, the mobile industry is moving towards greater densification, particularly looking ahead to 5G, yet cell sites remain costly to roll out.
There was a similar message from Arqiva CEO Simon Beresford-Wylie, who pointed out that to provide a city like London with the kind of capacity promised by 5G would require mobile operators to deploy 350,000-500,000 small cells.
"There aren’t enough lamp posts" to support that kind of deployment, he said. Small cells will have to be installed on the sides of buildings and connected to backhaul networks, which requires more planning and conversations with landlords, all adding up to high cost and complexity.
But Beresford-Wylie has a solution. "We should get the 10 people that can make this happen and stick them in a room," he said, adding that that room should include representatives from Ofcom, the Department for Culture, Media and Sport, the National Infrastructure Commission, the U.K.’s four mobile network operators, and Arqiva, of course.
"We need a room and a list of things we need to do," he said.
Connected Britain 2017 will provide such a room, should the various industry stakeholders care to use it. So put 14-15 June 2017 at the Grange St Paul’s Hotel in London in your diary and play your part in the development of connectivity in the U.K.
