Connected Research

Union policy research in the 21st century

Virgin Media in fibre trial

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Virgin Media, the UK’s consolidated cable operator, has announced that it will commence a trial in which glass fibre, used to deliver next generation, high-speed broadband services, is strung overground over telegraph poles (company press release; news media story [registration required; limited viewing time]. Households connected locally in this way can then be linked to the rest of the Virgin Media network.

The trial, which is taking place in the small rural Berkshire village of Woolhampton and which will last for six months, is significant in policy-making terms for a number of reasons:

1. it will test the viability of using telegraph poles to deliver fibre. Such a solution has been suggested in previous Ofcom statements on NGA (see Section 7) and could essentially provide a short-cut to the civil works required to deliver fibre technology. Typically, fibre optic cables are passed through underground ducts, but this accounts for the most significant investment costs in delivering next generation access, particularly the farther we get from urban areas. Fibre strung over poles is, however, much more common in the US, Canada and in Japan – from where, it would thus seem, that interesting deployment lessons may also be learned.

2. Virgin Media is a cable operator and is used to working with a different technology standard (DOCSIS 3.0 and its earlier variants) to glass fibre. The trial will thus test not only Virgin Media’s ability to work with a different standard, but also, given that the local fibre connections will plug into Virgin Media’s core cable network further up the line, how well the two different technologies communicate with each other.

3. If the trial is successful, it may provide a way in which the Virgin Media network, which has been stuck at around 12.5m homes passed (about 52% of UK households) for a considerable amount of time, can be extended beyond its current reach. Virgin Media’s lack of cash for investment in cable, given the history of the development of the sector in the UK, loaded as it was with debt and bankruptcy of the US parent operators, has completed inhibited it from extending its network beyond the core which is, inevitably, focused on urban, more densely-populated areas. This, in turn, would provide a greater capacity for Virgin Media to compete with BT, whose network is, of course, universal. At the same time, it opens up the question as to the point at which the Virgin Media network, which is currently protected from the wholesale regulatory requirements imposed on BT, might be opened up to similar obligations.

Virgin Media is being quite conservative in its press release about the number of homes that may be connected in this way: it has identified one million homes that stand to benefit from the deployment of fibre over telegraph poles – although, at the same time, it is apparently:

Keen to ensure that all communities, in towns, cities and villages right across the UK, stand to benefit.

Clearly, there is an unresolved tension there. It might be that there are technological reasons why such a deployment is suited to so few additional homes – which the trial could well help to iron out – if, for example, glass fibre, which tends not to lend itself to corners, proves not particularly amenable to this sort of deployment. Or it may well be, for instance, that existing capacity on telegraph poles is limited. Of course, it could also reflect the company’s own lack of investment cash, or indeed a fear that widespread deployment would result in regulatory intervention imposing a wholesale obligation.

Nevertheless, the trial is a welcome test bed opportunity and could well act to extend the reach of the market of the number of homes connected to next generation access technologies outside urban areas. It is also an interesting test of the extent to which the growth of ‘market’ based approaches to the deployment of next generation access is reliant on, or fearful of, the regulation required to deliver both extended levels of access and effective competition.

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Written by Calvin

12/03/2010 at 12:21 pm

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