Supplementary memorandum submitted by
BT (S50(a))
INTRODUCTION
1. Since submitting our written evidence
on 12 March there have been a number of developments that we would
like to bring to the attention of the Committee. In this memorandum
we provide brief details of the main issues and would be happy
to provide further information if that would be helpful.
REGISTRATION SCHEME
TO BE
EXTENDED TO
COVER 90% OF
HOUSEHOLDS
2. We have announced the addition of a over
300 exchanges to our registration scheme and that 400 more will
be added by the summer. The effect of this is that if all exchanges
with trigger levels were to be enabled, coverage would be extended
to 90% of UK households.
3. The key to this breakthrough is a technological
development that allows exchanges to be linked together so that
the costs of connecting them to the core BT network are reduced.
Almost all of the exchanges affected will be in rural areas.
LINE LENGTH
EXTENDED
4. In addition, we have announced the extension
of the "reach" of ADSL broadband within an exchange
area to around 6kms (from the current 5.5kms) from June, subject
to final trials. Around 98% of people in an enabled area will
be able to access the service, and 600,000 additional households
will be within the "footprint" from June. The actual
"reach" is determined by the loss of signal on the line,
so 6kms is only an approximation.
PRICES
5. Wholesale prices have been slashed, with
the basic consumer product down by 12% to £13.00 per month,
and business products being reduced by around 50%. We cannot say
what effect these cuts will have on end-user prices—this
is for service providers to say, but the UK already has some of
the lowest end user broadband prices in the world.
ADSL BROADBAND FOR
SMALL COMMUNITIES
6. We have announced that we will go ahead
with the full national launch of our pioneering ADSL Exchange
Activate service from July this year, following successful trials
in eight sites across the country. Under this scheme, a public
sector, private sector or individual sponsor can order ADSL service
at any exchange where BT are not currently available or planned.
It will be supplied in blocks of 30 connections, with the first
block costing £45,000. To put this cost in perspective, it
is than the cost of a good second hand tractor. Subsequent blocks
on the same exchange will cost £30,000. The fee covers all
installation and rental fees for three years and will enable broadband
to be provided to small, usually rural, exchanges where full ADSL
is not viable. After three years normal rental charges will apply
at the then current price.
WORKING WITH
LOCAL CAMPAIGN
GROUPS
7. We have launched a new website to provide
support to local campaign groups working to encourage people to
register their interest in broadband service. So far, we have
assisted over 400 such groups, most in semi-urban and rural areas.
We remain deeply grateful that prospective customers are willing
to canvas interest in broadband in this way.
KEY NUMBERS
8. Annex A contains a summary of the key
numbers of exchanges enabled, registrations and other information
as at 15 May 2003. The numbers are changing rapidly as our marketing
efforts gain momentum.
SUMMARY
9. We continue to believe that nobody else
in the private sector is doing more than BT to extend broadband
availability and take-up in the UK. The initiatives mentioned
above demonstrate this.
10. We continue to explore with Government,
RDAs, other local bodies and private sector players the possibilities
of working together to extend reach, to aggregate demand, to stimulate
further demand and so on. Partnerships in this area offer the
best chance of pulling forward demand so that broadband can be
brought to new areas as quickly as possible. We have recently
announced that we have drawn up five templates covering different
demand and supply situations that could be used by any supplier
or organisation looking for ways of providing assistance and support
for extending broadband availability and take-up. We have discussed
these templates with the DTI and DEFRA but it is important to
note that they are not BT-specific and have been put forward as
a constructive input to the wider national debate on broadband
availability.
11. We also continue to explore alternative
wireless and satellite technologies as well as cost saving measures
to bring down the cost of providing ADSL, all with the aim of
making broadband available as widely as possible and as soon as
possible. We lobbied hard for Government to make available the
"sweet spot" of 2GHz spectrum, which could have made
a significant contribution towards enabling rural broadband.
12. Against this background, we have been
disappointed with some of the comments made by others at evidence
sessions before the Committee. We are however encouraged by the
Minister's speech in the House of Commons debate on 1 May in relation
to public sector broadband aggregation. If this is executed in
a sensible and timely manner it could have a major beneficial
impact on ADSL trigger levels in non-enabled areas, specifically
accelerating the availability of rural broadband.
Annex A
BROADBAND—KEY NUMBERS
As at 15th May 2003:
— 1,273 exchanges have been enabled—125
since we submitted our written evidence 76 days ago
— 146 of these have been enabled via
the pre-registration trigger scheme
— 245 exchanges are in build having
passed their trigger levels
— over 420,000 registrations have been
made
— on average, one exchange a day is
hitting its trigger level
— we expect to announce another 400
trigger levels this summer
— ADSL broadband is available in exchange
areas covering approximately 69% of homes
— once the summer trigger level announcement
are made, then potential coverage (i.e. all the exchanges either
enabled or with trigger levels) would be 90%
— with ADSL extended reach to 6km from
June, an additional 600,000 households will be within the footprint
(an average of 98% of households in an exchange area will be able
to get ADSL broadband)
— currently, there are over 800,000
ADSL broadband customers[1]
using BT's wholesale network
— over 30,000 additional broadband
customers (ADSL and cable) each week
— ADSL volumes grew by over 300% in
the past year
— our targets are 1 million by Summer
2003 and 5 million by 2006
— average take-up in enabled areas
is currently around 5%
19 May 2003
1 Cable companies have announced that they had passed
1 million-we cannot comment on whether NTL's 128k service is truly
a broadband service. Back
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