COST EFFECTIVE BROADBAND SOLUTIONS FOR RURAL WALES

With the Welsh Assembly Government (WAG) looking to abandon business support for the majority of small businesses and channel the money towards a £240 million super broadband system, there have been questions asked about whether this is the right strategy, especially as the cost looks prohibitively high for an infrastructure that many simply will not use.

Indeed, it is has been suggested that having civil servants sitting cosily around a table with large telecommunications companies may not be the best way to assess the cost of broadband, especially to rural areas, and there may be cheaper options available.

Last month, this column noted the case of Erbistock near Wrexham, which had been quoted a price of £550,000 from BT to install broadband across the village and had then been offered a similar solution, by a small company, Rutland Telecom, for a tenth of the price.

Well, it would seem that the publicity following this case has forced the telecommunications giant into finding a solution that, magically, will now cost just £100 per home, with BT arguing that the original quotation was just one option for Erbistock.

However, this one case demonstrates that, contrary to what some have suggested, rural broadband can, with a will and a lot of PR, be made more accessible at a far cheaper price than previously suggested.

In that case, has WAG wildly overestimated the cost of extending broadband across Wales?

Indeed, is incentivising companies such as BT and Virgin Media through government subsidy the only way to get broadband to rural areas?

Well, we only have to look to another rural area, this time in England, to find a potential answer.

In Cumbria, the local MP Rory Stewart believes that, rather than relying on the normal commercial channels of procuring broadband, there are other ways to ensure that it is made available for his entire rural constituency by 2012.

More importantly, he believes he can cut the quoted market price of £40 million to a cost of less than £1million, with only half of that coming from the taxpayer.

His solution?

Simply put, many communities have fibre-optic cables that are already in place to serve schools and other public buildings.

Mr Stewart aims to use these existing high speed connections to extend the broadband network across the constituency. He believes it would be relatively simple for each Cumbrian village to simply “piggyback” on these cables. Households would then pay a relatively small sum to extend the cable to their homes. Several communities could also be served by simply extending a wireless hub from a public building with broadband.

Of course, there are problems with this approach, most notably through European regulations that may restrict the use of public sector fibre cable.

However, these can be overcome especially if OFCOM, the telecommunications regulator, focuses on developing a solution to the issues related to the use of publicly owned broadband.

As the case of Erbistock has demonstrated, even a large company such as BT can be persuaded to come up with a cost effective price when pushed to do so.

Most rural areas in Wales could also benefit from imitating Rory Stewart’s proposed solution and accessing existing public sector cables to provide cheap broadband solutions.

This does seem to suggest that the £240 million proposed cost of developing a superfast broadband infrastructure for Wales, in conjunction with the major telecommunications providers, should be urgently re-examined.

At the very least, the solution should be put into the hands of the consumer rather than large suppliers who are predominantly in a monopoly position.

And with pressures to reduce costs to the public purse, WAG Ministers need to seriously consider whether its current supply-driven plans for broadband will deliver a cost effective solution for the benefit of the Welsh economy.

Hopefully, those plans will not include any pigeons!