BT faces criticism for revised duct and pole access prices

By Derek du Preez
07 Oct 2011 View Comments
A BT Openreach van

BT Openreach has revised its January draft prices that communication providers must pay to access its ducts and poles (PIA), following a backlash from other communication providers and information gained from ongoing trials.

Further reading

PIA allows network operators to connect to Openreach's infrastructure, where they can install sub-ducts in BT's ducts, or attach equipment on to BT's poles, in order to provide broadband in hard to reach areas without having to make huge capital investments in setting up their own infrastructure.

BT has said it hopes this will contribute towards the government's aim to have the best broadband network in Europe by 2015, as it will create commercially viable options for communication providers to deploy broadband in rural areas.

Ofcom stipulated that Openreach would have to open up its infrastructure in October 2010, resulting in Openreach running trials to establish cost-based prices.

However, when BT announced its draft prices in January, there was much criticism from network operators that the use of PIA was still not commercially viable.

For example, Andy Stevenson, managing director of network solutions at Fujitsu, spoke to Computing in April and insisted the prices were too high.

"We have not agreed to pay the original price proposed by BT," said Stevenson at the time.

The original five-year draft price for spine duct access was set at £1.16 per metre in January. This has now dropped, in some cases, to 44p per metre. The price for a lead-in duct, which is used for the last few metres to the premise, has fallen from £2.12 per metre to £1.34.

The price for access to a drop pole, where several wires can be fixed to each pole, has fallen from £21 per attachment to £11.

A study by industry analysts Ovum has found that under the revised prices, communication providers will pay between 15 and 22 per cent below the European average (compared with Portugal, Spain and France) for access involving fibre-to-the-premises, and between 17 and 38 per cent less in fibre-to-the-cabinet.

"We have tried to model the costs over a 10-year period, so we take a mixture of the one-off costs and the ongoing costs, because if you look at things from day one it's always going to be expensive," said Matthew Howett, analyst at Ovum.

"But the communication providers that will be making use of this offer will be deploying networks, which will probably last at least 10 years," he added.

Howett told Computing that network operators should be pleased with the result.

"Communication providers really should be happy with this. The prices have come down quite substantially – as much as 40 per cent in some cases," he said.

However, if BT was expecting a positive reaction, it hasn't received one. Although Fujitsu and TalkTalk were not able to provide much comment, Virgin Media provided detail that suggests the outcome is not what it had been hoping for.

 

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