Out-Law News 3 min. read
08 Feb 2016, 5:07 pm
The agreement has been backed by the UK government but criticised as "inadequate" by broadband advice service Cable.co.uk. The headline terms of the agreement are set out in a joint letter from Openreach and the HBF to the UK government (3-page / 323KB PDF).
Under the deal, Openreach anticipates that 56% of new build properties will be able to be connected to a superfast broadband service for free. Superfast broadband is defined as internet connectivity of speeds of 24Mbps or above.
Connecting the remaining properties would depend on developers opting in to an agreed "co-funding" arrangement that Openreach and the HBF have agreed. Openreach has committed to investing £550 on average per home to connect new build sites to superfast broadband services before the co-funding arrangement would apply.
"Developers will have access to a clear, up-front indication where a site can be connected for free or where Openreach and developer co-funding is required for a development and then be in a position to determine whether to take up the offer as set out in the Openreach ‘rate card’," the Openreach/HBF letter said. "They will also have the option of seeking alternative provision or adopt a standard copper connection."
"Although the co-funding offer is available to all those outside of existing coverage, for some of these smaller developments the cost to connect will be considerable and it is for these that wider community funding and alternative technologies could have a role to play. Openreach and the HBF jointly recognise there is still more work to be done to come up with solutions for the smaller developments of fewer than 30 homes where they do not benefit from existing coverage," they said.
However, Cable.co.uk said that the agreement fell short of what is needed to put an end to "years of broadband misery" that new home buyers can face at the moment.
"What is the purpose of a network provider making it easier for developers to install proper broadband infrastructure if it still remains the homebuilder’s choice as to whether or not to take action? Dan Howdle, consumer telecoms expert at Cable.co.uk, said. "These measures are arbitrary and unlikely to have any effect. They comprise neither legislative enforcement of superfast for new builds, nor any obligation for homebuilders to inform buyers they face years of broadband misery."
Telecoms and property law expert Alicia Foo of Pinsent Masons, the law firm behind Out-Law.com, said the deal to improving connectivity in new build homes was "a start".
"Many of the British public now regard high speed broadband services as an important utility like electricity, gas and water," Foo said. "The agreement should ensure that many new homes are suitably equipped from the outset with connectivity fit for the digital age, but some will view this deal as a missed opportunity."
"The co-funding arrangement is an interesting concept designed to encourage developers to provide for superfast broadband connectivity across their sites. However, some developers might want to evaluate the full range of connectivity options available to them rather than commit to the funding package available through the Openreach deal, whilst it is also clear from the Openreach and HBF letter that deploying superfast broadband in remote areas of the country will present technical, logistical and funding challenges," she said.
Separately, a survey carried out by manufacturing industry body the EEF has highlighted the importance manufacturers assign to good internet connectivity. The EEF said that 91% of the manufacturers they surveyed said they think a high speed internet connection is as essential to business as electricity and water, whilst 86% of respondents said every business in the UK should have a legal right to access a high speed internet connection.
According to the survey, more than half of manufacturers do not think their current broadband service will be able to support their expected connectivity needs over the next five years. Most manufacturers said they will invest more in "internet connected capital equipment" in the next five years and four in five companies in the sector believe the new technological revolution in manufacturing – dubbed industry 4.0 – will be "a business reality" by 2025. Already 48% of manufacturers use "internet connected objects" like sensors and automated machines at least once a week, the EEF said.