Putting connectivity back into the hands of the consumer
8th January 2019
Mikael Sandberg, Chairman VX Fiber
Broadband service providers have faced backlash in recent months following misleading ads claiming to offer “full fibre services” to consumers. The claims were validated by research finding that almost a quarter of Brits think they have full fibre broadband, despite this only being available to five per cent of UK properties.
What consumers are in fact paying for in many cases is a fibre optic connection that only runs as far as the street-level cabinet, then relies on legacy copper wires for the last step of connecting properties. A full fibre connection on the other hand sees fibre optic cables run right to the doorstep and can achieve ‘Gigabit’ or even multi-gigabit (1Gbps +) speeds.
It’s no wonder consumers are confused. Despite the speeds conjured by the words, neither “superfast” (24Mbps) nor “ultrafast” (100Mbps) broadband offer the fastest speeds available to the consumer today.
At a time when trust has been eroded, a new approach is needed to inform the consumer, deliver the service deserved, and put the power back into their rightful hands.
Finding a faster approach
For consumers and businesses alike, connectivity is an essential utility. But the UK has been slow off the mark to deliver increased speeds and provision. The government may have achieved its target for 95 percent superfast broadband coverage in 2017, but this simply isn’t enough to move the needle.
The UK needs to get ahead of the curve, rather than trying to keep up. And doing this requires a more progressive approach. The truth is that connectivity should no longer be judged on speed alone, but rather on its ability as an enabler. Connectivity is as important a utility as electricity or water. But consumers wouldn’t typically worry about access to these services. When you turn on a tap or a light switch it ‘just works’, and it should be the same for connectivity.
Full fibre eradicates consumer concerns over limited or poor bandwidth as it enables unlimited, instant connectivity. With the IoT giving rise to much higher connectivity needs in the home, full fibre is needed to futureproof networks.
However, there are some signs of progress. In July of this year, the government announced its commitment to delivering full fibre broadband access to all UK homes by 2033. But it’ll be tough; despite increased industry focus the availability of full fibre only rose very slightly from four per cent to five per cent between 2017 and 2018.
Ofcom, the UK regulator that released these statistics has said it’s continuing to work with government and industry to drive further investment in full fibre – including new rules to make it cheaper and easier for companies to lay full-fibre networks. In line with this the Department for Digital, Culture, Media and Sport (DCMS), has called for alternative models to remove the barriers to the deployment of fibre and to encourage investment. Its aim is to determine how a different model could drive competition in the market to deliver more widespread fibre coverage.
Investing in and rolling out fibre connectivity on a national scale is a mammoth task, and exploring alternative models to rolling out fibre is the first step. But if the UK is going to deliver the speeds that consumers and businesses expect and deem essential, it needs a radical shift in mindset.
Giving back control: Sweden as a benchmark
One country that has done this is Sweden. It is light years ahead of the UK with 60 per cent full fibre penetration, thanks to its commitment to gigabit-speed connectivity. And it looked to an alternative model to achieve this.
Sweden uses what’s called an Open Access Model to separate decisions and investment in infrastructure from the services offered to consumers and businesses. That means that the government, local authorities, even land owners all invest and own fibre, allowing service providers to offer their products on top, directly to local subscribers using a self-service web portal.
A great example of this is Stokab (wholly owned by the City of Stockholm), a network that is open to everybody on equal terms. The City monetises the fibre like a piece of real estate, allowing it to continue to build the network with the “rent”, and offer freedom of choice to its citizens. In addition, the ZMarket portal offers greater transparency into the cost and suitability of the different available service offerings across a huge number of municipalities across Sweden.
This has a number of benefits – an Open Access Portal provided by several service providers empowers consumer choice and self-service. It also gives consumers the benefit of lower prices, and access to better, more varied services in a truly open market. Customers can switch providers without barriers instantly, try new services as they are developed, and enjoy greater transparency into the cost and quality of providers’ offerings.
This is leading to a point where all future services (from eHealth, to education, to local businesses) will start to converge with the fibre network. The open ecosystem means service providers can create a shopping centre environment where they can continuously innovate the types of services they can offer to consumers through this central virtual portal – like beginning to offer home automation or security services.
Replicating success in the UK
Sweden represents a great example of a country that has overhauled the traditional model to give back control to consumers. Doing so has accelerated the development of fibre infrastructure, meaning the country now has the second highest broadband speeds in the world.
Sweden’s model has also allowed it to deliver a better service to consumers. The Open Access Portal means that consumers have greater visibility of the services available and know exactly what they are paying for. And that’s what we’re missing in the UK currently – a way of informing consumers and letting them control the service they receive. Greater choice and better services can only lead to more satisfaction among consumers.
With only five per cent full fibre penetration in the UK, this area of thinking is completely different from the existing model in this country. But with DCMS exploring new ideas and models, there is no reason that the UK cannot do the same to boost connectivity. That begins with a shift in mindset from the speed of a fibre connection, to the future services and choice that it can enable.