Broadband Strategy. Improving Internet Connectivity across Stirling. Final Report. Stirling Council

Transcription

1 Broadband Strategy Improving Internet Connectivity across Stirling Final Report Stirling Council March 2013

2 Stirling Council Broadband Strategy Final Report Copyright 2013 FarrPoint Ltd has produced the information contained herein for Stirling Council. The ownership, use and disclosure of this information are subject to the Terms and Conditions contained in the contract between FarrPoint Ltd and Stirling Council, under which it was prepared. Document Tracking Document Author A Muir A Muir Document Reviewer JD Olliero JD Olliero Version Date 01 March March 2013 Notes Issued Comments Incorporated

3 CONTENTS 1. Executive Summary Background Introduction The Area Stirling City Rural Areas Loch Lomond & The Trossachs National Park Economic Activities Benefits of Broadband Summary Broadband Provision Introduction BT ClacksMax Community Councils Council Survey Broadband Developments Broadband Technologies Introduction Basic Broadband Next Generation Broadband Technology Comparison Step Change Background Analysis Methodology Basic Broadband Provision Step Change 2015: 75% Coverage Target: 80% Coverage Target: 85% Coverage Target: 90% Coverage Target: 95% Maximum Coverage Strategic Options Option 1 Additional Funding to Step Change Option 2 Funding for Rural Communities Option 3 Stirling City wireless Supporting Organisation Conclusions STC1D2V2.0 Page 1 of 52 March 2013

4 1. Executive Summary This document presents a strategy to improve the provision of broadband services across the Stirling Council area. Access to affordable broadband is regarded as a key priority for the Council due to its importance in delivering economic and social benefits that are clearly understood. The Council s position in relation to broadband is that they are not, and will not be, a provider of broadband services but they can help facilitate and, in some cases, provide additional funds to help improve the provision of services in the area. Feedback from stakeholders including community representatives show there are significant problems in rural areas where a number of active rural communities have an unusable broadband service which hampers development and threatens sustainability. A commonly stated desire is to widen access to usable broadband speeds rather than focus on further increasing speeds for those already with a commercially available and usable service. The Scottish Government Step Change 2015 procurement aims to deliver 75% coverage of Next Generation Access (NGA) to premises by The Council has committed 600k of additional funding to the programme in order to reach 80% coverage within the Council area. Modelling within this study has predicted the coverage areas from the Step Change project and also at various levels of additional Council funding to that programme. Stage Coverage Areas Covered Step Change 75% Stirling, Dunblane, Bannockburn, Bridge of Allan (including the business parks at Springkerse and Castle) 600k Council funding 80% Above plus Callander, Balfron 1m Council funding 85% Above plus Doune, part of Blanefield 1.77m Council funding 91% Above plus Blanefield, Drymen, Killearn, and Aberfoyle 2m Council funding 95% Above plus Gargunnock, Kippen and Buchlyvie It is evident however, that alternative solutions and technologies will be required to reach out to the rural areas in the north of the Council area in particular although delivery of the Step Change programme must be seen as the initial step before investigating alternatives to any great extent. The benefits of delivering a standardised broadband product over bespoke solutions are significant in terms of user acceptance and service sustainability. STC1D2V2.0 Page 2 of 52 March 2013

5 The business Gross Value Add (GVA) uplift combined with monetised household and residential benefits as a result of NGA deployment in the additional 5% of postcodes enabled by the Council s 600k funding investment potentially falls within the range of 864k pa to 870k pa. The corresponding GVA uplift against the approximate 900k investment required to reach 85% falls within the range of 794k pa to 1m pa. This represents GVA leverage in the region of 1.45 per 1 of gap funding for the 80% scenario and 0.88 to 1.11 for the 85% scenario. These figures represent positive value for money (returns on investment) at the 80% scenario but very limited to negative value for money for the 85% scenario. The strategy has reviewed the most effective options for the Council to pursue in terms of broadband improvement and the following recommendations are made: Step Change R1: The Council should review the predicted coverage from Step Change post supplier survey stage and influence, where possible, the final coverage area R2: The Council should liaise closely with the Step Change team and appointed supplier to determine the additional coverage that could be achieved through further investment to reach 85%. A review of the cost benefits may be conducted once this is understood. R3: The Council should provide local assistance to Programme 4 of the Infrastructure Action Plan covering Digital Participation to ensure highest take-up of broadband within the Council area. Community Broadband R4: The Council should identify organised community projects in rural areas unlikely to be covered through Step Change and support the submission of Expressions of Interest to Community Broadband Scotland (CBS). R5: The Council should liaise with CBS to determine the mechanism for potential investment of Council funds to support local community projects R6: The Council should support CBS Project Officers once appointed to work with those local communities who are currently less developed to progress broadband plans and learn from other local projects City Wireless R7: Commence dialogue with other relevant stakeholders into the potential for a city wireless project in order to assess potential interest. R8: Conduct a feasibility study to investigate possible commercial and operational solutions for consideration by the Council and other stakeholders. Liaise with Scottish Cities Alliance for knowledge share. Organisational R9: Appoint a project manager to further develop, deliver and report on the actions set out in this strategy R10: The Council should continue to support existing broadband projects and continue to explore opportunities to progress infrastructure deployment. STC1D2V2.0 Page 3 of 52 March 2013

6 2. Background 2.1 Introduction This document presents a Strategy and Cost Benefit Analysis for the provision of improved broadband services within the Stirling Council area. The strategy is built up as follows: The area is described in terms of populations, business activity and development plans; The current broadband service provision is base-lined, highlighting the capabilities and main areas of concern through feedback from community consultations and representations; The existing Scottish Government initiatives are described and how they are predicted to affect the Council area; The technologies that can be used in the delivery of broadband are described in terms of their capabilities and deliverability; The most effective options to improve the provision of high quality broadband in terms of costs and benefits are identified; Recommendations are made in order to progress the strategy options idenitfied. Appendices to this report provide further detail as follows: 2.2 The Area Appendix A describes the cost benefit analysis undertaken; Appendix B describes in more detail the technical options to deliver broadband; Appendix C describes the cost modelling of infrastructure deployment. Stirling Council covers an area of just less than 2,200km 2 and includes settlements on the edge of the Highlands in the north, Glasgow commuter villages in the southwest and former mining villages in the east. Scotland s smallest city of Stirling comprises the main urban centre along with Bannockburn, Dunblane and Bridge of Allan, which combined cover around 64% of the total 90,770 population. The relatively low population density across most of the area presents challenges in ensuring all communities and citizens have access to high quality service and Stirling City Centre itself must also ensure it keeps pace with other urban centres. Figure 2.1 shows the main urban areas, commuting areas into Glasgow and the National Park. STC1D2V2.0 Page 4 of 52 March 2013

7 Figure 2.1: Stirling Council area (source FarrPoint/Atkins) The key settlements and population figures are listed as follows: Settlement Stirling Pop Settlement Pop 47,000 Doune 1,600 Dunblane 8,930 Kippen 1,020 Callander 3,110 Aberfoyle 800 Fallin 2,800 Gargunnock 800 Cowie 2,550 Drymen 750 Plean 2,010 Killin 670 Strathblane 1,990 Thornhill 610 Balfron 1,800 Buchlyvie 510 Killearn 1,750 Figure 2.2: Settlement Populations (source: Stirling Council) STC1D2V2.0 Page 5 of 52 March 2013

8 2.3 Stirling City Stirling City is at the centre of a large rural agricultural area and principally functioned as a market town. It has now developed a substantial retail sector serving a wide range of surrounding communities as well as the city itself. Tourism is a big employer in the area and with the presence of such historical monuments as Stirling Castle, the National Wallace Monument and other nearby attractions like Blair Drummond Safari Park, the key role which Stirling has played in Scottish history, as well as the scenery of the area, has bolstered Stirling's position as an important tourist destination in Scotland. The University of Stirling and Stirling Council are two of the biggest employers in the area. Knowledge related industries, research and development as well as life sciences have clustered in the Stirling University Innovation Park, close to its main campus. Other public sector agencies that are major employers in the city include Central Scotland Police, Scottish Prison Service, NHS Forth Valley and the Scottish Environment Protection Agency. The vision for Stirling City Centre to 2018 and beyond is to create a vital, vibrant, dynamic, enterprising, diverse and resilient economy, with a magnificent built, landscape and cultural heritage 1. Within this there are four strategic themes one of which is Economy which identifies opportunities to support the four key sectors of tourism, food and drink, creative industries and sport. For creative industries and tourism in particular, access to high quality broadband, fixed and mobile, will be an enabler to support company growth and sustainability within the city. The Stirling City Centre strategy has identified an action within the City Centre Economy Theme to deliver advanced connectivity broadband with key tasks to: Ensure that Stirling is in the premier league of super-broadband cities; Promote provision of WiFi access by city centre businesses; Introduce WiFi within all key destinations within the City Centre. 2.4 Rural Areas Rural Stirling 2 has a growing but ageing population of approximately 33,490, which makes up 38% of the total Council population. As of 2009 there were 14,319 1 Proposed Stirling City Centre Strategy, & Beyond, Stirling Community Planning Partnership 2 All Council area except for Stirling, Bridge of Allan and majority of Dunblane STC1D2V2.0 Page 6 of 52 March 2013

9 households in this area. As to be expected within a more rural area the main business sectors are trade services, business service activities, health and social work, small-scale manufacturing, hotels and restaurants and education. There is also a high proportion of self-employment. An ageing rural population, and depopulation in some areas, suggests a need to attract new, and retain existing, populations, particularly in the younger age groups. This will require supporting infrastructure from housing through to business space and high quality broadband. Rural areas without access to high quality broadband, or even usable broadband, will remain at a disadvantage. Case Study Callander Callander is the 3 rd largest settlement in the Council area with a population of over 3,000. Historically an important tourist destination, it also acts as an economic and social hub for the rural north of the area. The tourism market has changed from the past and the town must react to retain this key industry whilst also supporting the development of other sustainable businesses. The local Enterprise Trust tries to encourage small business to invest in the town but recognises that the current broadband service is a limitation. Callander is served by an ADSL enabled exchange which offers standard ADSL services at up to 8Mbps depending on distance from the exchange. However there are issues with broadband speeds within the town with premises close to the exchange only receiving speeds in the region of 2Mbps at best. This is likely to be due to issues with the local cabling routes or quality of installed cables. There are no known plans to upgrade this service to either NGB or even ADSL2+ (offering up to 24Mbps). In terms of its size and strategic importance to rural Stirlingshire, the town is seen as a top priority for upgrade. 2.5 Loch Lomond & The Trossachs National Park Within the National Park Plan a number of priorities for action are set out with one of the key policies to enhance rural development by supporting the rural economy. As part of this, Priority for Action RD7 is for Rural Broadband, which is considered crucial for business and those that have poor quality broadband coverage are at a severe disadvantage. Consequently there is a 2017 target to increase rural broadband coverage and speed within the National Park. STC1D2V2.0 Page 7 of 52 March 2013

10 2.6 Economic Activities Stirling has a diverse economy with no single dominant activity; instead a range of sectors are represented and for each, broadband plays a significant role in underpinning the economic activity. The lack of availability of usable broadband service, which is now essential to the sustainability of many rural businesses, including sectors such as tourism and agriculture, has been identified as an issue through community feedback sessions. A particular case has been made for the community of Callander, which is a key economic centre within the centre of the area and the gateway to the National Park. With a population of around 3,000, it is the next largest community with no current NGA availability. There is anecdotal evidence that businesses have relocated due to poor broadband service which threatens the economic development within the area. Following the local elections in May 2012, Stirling s new political leadership set out its key priorities for the next three years Serving Stirling. These priorities include the following three areas that are particularly relevant to improving broadband provision: Priority Deliver and improve upon access to and speed of internet access across the Stirling area Regenerate our most in need communities to deliver a full range of positive social, environmental and economic outcomes Examining and delivering on more opportunities for improved models of service delivery Comment The Council has agreed to top-up government funding to ensure that more of the Stirling area is included in the upgraded broadband coverage. Broadband will be a key enabler in this regeneration. Some communities may need alternative solutions to provision of broadband that may involve community action. The Council may play an active role in supporting such initiatives. Improved service delivery is increasingly about adoption of digital services which relies on infrastructure being in place and increased digital participation Figure 2.3: Stirling Council Priorities (source: Stirling Council, Serving Stirling) STC1D2V2.0 Page 8 of 52 March 2013

11 2.7 Benefits of Broadband Faster broadband can result in a range of benefits. The most recent comprehensive review of research, just published by DCMS 3, identifies a wide range of literature, demonstrating the range of impacts attributable to broadband and the evidence supporting this. There are some discernible trends emerging: Discernible business impact trends derived from the most recent research reported in the literature are: ICT adoption and use generates additional output and value added (GDP/ GVA) 4,5,6% or more GDP uplift; Some of this translates into jobs although not on a 1:1 basis; Some of this is attributable to broadband, and some to faster broadband somewhere between 1-3% GDP uplift. Discernible residential/household impact trends are: Access to the Internet indisputably provides a range of benefits, for example: Increased educational attainment resulting in higher lifetime earnings, better access to jobs resulting in higher lifetime earnings, savings from shopping on line; Access to entertainment and access to health information resulting in improved health and wellbeing; Access to the internet for public sector workers and internet access to clients is resulting in a combination of benefits which can be categorised into two broad groups; Cost savings resulting from improved internal public sector systems linked to increased transactions with the public on line; flexible and home working resulting in increased productivity; Public sector service improvements, for example, improved education, improved health, improved social care. The benefits that derive from broadband, and particularly from faster broadband, can be categorised in a number of different ways. In our analysis, we have categorised the benefits into two broad groups as follows: Benefits derived from local businesses accessing faster broadband: resulting in increased productivity, innovation and enterprise, leading to increased sales and turnover, generating additional GVA and equivalent jobs; 3 published by DCMS, (Department of Culture, Media and Sport) STC1D2V2.0 Page 9 of 52 March 2013

12 Benefits derived from residents accessing faster broadband: increased educational attainment, increased access to jobs, savings from shopping on line, savings to public sector from more transactions undertaken online, savings to the NHS through reduced visits to the GP. This is by no means an exhaustive list of residential benefits, but instead is meant as an illustration of the types and associated scale of benefits that can derive. The analysis monetises all of these benefits into annual equivalent cost savings/increased income. A full description of the cost benefit modelling is provided in Appendix A. 2.8 Summary The Stirling Council area is a mix of urban centres around Stirling City and neighbouring towns in the southeast and a large rural area that extends north and westwards. The City, being the smallest in Scotland, has to promote itself and build on its emerging economic focus areas whilst also being aware of developments in other centres to further develop their broadband infrastructure and services 4. The rural areas face challenges around service delivery and business investment and will require elements of support from public bodies. The Council recognises the importance of broadband for sustaining business and communities and its application in both rural and urban areas. However whilst the marketplace may largely meet urban area requirements, and hence Council support may be in more indirect ways, the rural areas will require additional support to ensure that broadband services at usable levels become more widely available. 4 The Super-Connected Cities programme awarded 100 million from the Urban Broadband Fund (UBF) to ten of the largest UK cities, including Edinburgh, to provide speeds of Mbps and wireless connectivity. A subsequent Phase 2 announced a further 50 million for smaller cities including Perth and Aberdeen. STC1D2V2.0 Page 10 of 52 March 2013

13 3. Broadband Provision 3.1 Introduction This section describes the current broadband provision in the area in terms of availability and performance and then captures feedback on broadband provision from surveys and other representation from the communities. 3.2 BT BT has 26 local exchanges in the area, which have varying levels of broadband capability. Figure 3.1 shows the approximate cover from each exchange and the type of service offered in each area. It is important to note that this Figure does not show broadband availability; rather it shows the exchange types and the geographical boundary of each exchange. Broadband speeds will vary throughout the exchange area. Figure 3.1 BT Exchange locations and capabilities (source FarrPoint/Atkins) STC1D2V2.0 Page 11 of 52 March 2013

14 Connection to a Next Generation Broadband (NGB) 5 capable service is available to approximately 60% of premises through the provision of Fibre to the Cabinet (FTTC) 6 in exchange areas of Stirling, Bannockburn and Dunblane. Note that not all premises connected to FTTC will receive NGB speeds: speed is dependent on distance from the cabinet and some premises at a long distance from the cabinet may only receive speeds similar to standard broadband. Note also that not all premises in these exchange areas will be connected as some may be served by cabinets which have not been commercially upgraded and some may be served by lines fed direct from the exchange and not from cabinets (Exchange Only lines). The highest speed ADSL broadband service is ADSL2+ provided from equipment within the exchange with speeds dependent on distance from exchange. This has a maximum download speed of 24Mbps and is available in the Bridge of Allan exchange and alongside NGB in Stirling, Bannockburn and Dunblane exchanges. All other exchanges bar two are served by standard ADSL service, which offers speeds up to 8Mbps download. The exception are the exchanges at Trossachs and Inversnaid which are served by a limited version of ADSL known as Exchange Activate which was developed for very small exchanges with limited backhaul capability (connectivity from exchange back into main BT network). Premises served from these two exchanges are limited to 0.5Mbps and a restricted number of ISPs, in many cases just one ISP. 3.3 ClacksMax ClacksMax is a project led by Clackmannanshire Council with additional input from Stirling Council, to bring a wireless broadband service to areas of the two Councils. Through funding from the Scottish Government's Rural Broadband Challenge Fund, the Councils contracted with an external supplier to purchase, install, maintain and operate the wireless service designed to target business premises. In addition, residential premises benefit by being able to connect to the service when coverage allows. The Council offers Council buildings for installation of radio equipment thus reducing operational costs for the duration of the contract period. The core target areas in Stirling are Touch Business Centre and Bandeath Industrial Estate with parts of Alloa West and Tillicoultry in Clackmannanshire. To date the network is offering service in areas of Alloa, Tillicoultry, Bandeath and Touch Business Centre with further sites planned. Uptake has been limited to a small 5 In line with the Scottish Government, NGB is defined as download speeds greater than 24Mbps 6 See Section 4 for detail on technologies STC1D2V2.0 Page 12 of 52 March 2013

15 number of businesses in these areas and the network and service provision can be considered to be in its early proving stages. 3.4 Community Councils Community Councils have expressed strong interest in improving Internet connectivity particularly in the more rural areas. The communities bring evidence of the day-to-day usability of broadband provision and the issues they face in running their businesses and homes Workshop On 12 January 2013 a Digital Connectivity Community Consultation Workshop was held in the Stirling Council Chambers which was well attended by community representatives from across the Stirling area. FarrPoint/Atkins presented on the broadband market, technologies and initiatives before opening up for discussion and feedback. This was an extremely useful session with a common view being that the raising of average speeds to a usable level (eg upwards of 4Mbps) was more important than striving to higher bandwidths for those already connected. A number of examples were given of communities struggling with very slow and sometimes unreliable services. There are no known examples of established community networks within the area although there appears to be a desire for action within communities in the very near future. A summary of the key points from the workshop is provided below: Balquhidder, Lochearnhead and Strathyre Carron Valley Callander Representatives found it difficult to get information from BT and are interested in finding a solution themselves eg provision of a cabinet at the village hall. Poor service as the community lies at the end of two exchanges (Bannockburn and Denny). Suggestion that 25% of a businesses clients have moved out of Callander because of STC1D2V2.0 Page 13 of 52 March 2013

16 poor broadband speeds. Port of Menteith Gartmore Killin Have been told the cable in their area is too old and needs to be upgraded but they ve been told this for the past 7 years and nothing has been done. 4 km from the exchange in Aberfoyle. They have a lot of disruptions and their maximum speed is 2Mbps (some have none). They are worried that resources will be redirected to easy to fix areas. They believe that a fibre cable runs within a 1km of the village and they would like to tap into this. They would like to have a cabinet in order to obtain FTTC. Outlying areas that can t get any broadband. Figure 3.2 Community Workshop key points (source FarrPoint/Atkins) Community Feedback Rural communities have raised a number of common issues with the current levels of broadband as follows: Some communities have investigated the possible use of mesh radio as a community solution; Some locations currently use a satellite system, but it is considered expensive compared to normal broadband prices; Access to distance learning courses at universities and colleges rely on a reasonable broadband speed to be able to download videos of lectures, or take part in video conferencing tutorials. In some rural areas broadband is too slow for either of these to be a realistic option; Communities believe that the need for reliable higher speed services is now absolutely critical, with local businesses incurring heavy costs, having to forego new opportunities and even having to move their operations out of the area altogether; The continued viability of some communities will increasingly be predicated on the availability of effective communication for business, education and domestic use; STC1D2V2.0 Page 14 of 52 March 2013

17 Case Study Monachyle Mhor Hotel The Monachyle Mhor is an internationally renowned boutique hotel, restaurant and farm and an important local employer. It operates its own high-quality web site, an online booking system and needs to use online services extensively for ordering, communicating with clients and providing connectivity to guests of the hotel. The owner has estimated that the direct cost to the business of trying to compensate for poor local connectivity is at least the equivalent of one full-time member of staff. That however still ignores the indirect costs of being unable to provide the full range of communication services that are taken for granted by its target market. 3.5 Council Survey Stirling and Clackmannanshire Councils conducted an online survey with businesses between August 2011 and February 2012 to gather evidence on broadband speeds, broadband usage and current issues with broadband service provision. A total of 248 returns were made of which 75% were from within the Stirling Council area. Results for download speed are shown in Figure % 30% 25% 20% 15% 10% 5% 0% 0Mb 0-2Mbps 2-5Mbps 5-10Mbps 10-24Mbps 24-40Mbps 40Mbps + Figure 3.3 Surveyed Speeds - businesses (source Stirling Council) For the vast majority (99%), upload speeds were below 2Mbps. Despite these relatively low speeds, near 90% of respondents stated that broadband was critical to business and over 90% indicated they would need a more reliable and faster service within the next three years. Businesses were asked how improvement to their broadband service would benefit their business with the key highlights being: STC1D2V2.0 Page 15 of 52 March 2013

18 More effective communication 73.8%; Improved business productivity 73.0%; Improved competitive advantage 50.8%; Ability to create more flexible working arrangements 50.4%. Over the same period, the two Councils also conducted a survey with residents to gather evidence on broadband speeds, usage and issues. A total of 916 returns were received with 62% from Stirling Council area (approx. 570 respondents). Results for download speeds are shown in Figure 3.4, superimposed on the similar business results shown previously. Figure 3.4 Surveyed Speeds business and residential (source Stirling Council) Similarly to businesses, over 80% of respondents strongly agreed that broadband was important to them and near 90% indicated they would need a more reliable and faster service within the next three years. Respondents were asked how improvement to their broadband service would benefit them with the key highlights being: Quicker file transfer saving time and reducing stress; Time related benefits, achieve more in less time; Better value for money; Make working from home easier, more effective and more efficient; Allow multiple use within the household; Access to iplayer; Greater access to educational material; Better communication with friends and family and support networks; Increased employment opportunities. STC1D2V2.0 Page 16 of 52 March 2013

19 3.6 Broadband Developments Infrastructure Action Plan The Scottish Government s Infrastructure Action Plan 7 sets out the Scottish Government s commitment and the steps to be taken to deliver world-class, future proofed digital infrastructure across all of Scotland by 2020, with an interim milestone of delivering a step change by The Infrastructure Action Plan sets out four programmes, that combined, aims to ensure that the ambition to deliver a world-class digital infrastructure for Scotland is met. Programme 1: Achieving a step change by 2015 will address the current digital divide and put in place infrastructure in those areas that the market will currently not go, to ensure a step change in speeds by The outcome the Scottish Government is seeking is a significant uplift in speeds for everyone by 2015, with speeds of 40 to 80Mbps for 85% to 90% of premises. The procurement will seek to extend the reach further and deliver the best possible speeds for those where delivery of 40 to 80Mbps is not possible at this stage. Programme 2: Achieving world-class by 2020 will deliver a longer-term plan, developed in parallel, to ensure the right mechanisms, partnerships and commercial models are in place to deliver worldclass infrastructure in a sustainable way and in partnership with industry. Programme 3: Demonstrating and delivering innovative and local solutions will be targeted at promoting locally based projects and programmes and also trialling new technologies. Programme 4: Increasing take-up and stimulating demand will be targeted at raising digital participation rates (for businesses and individuals) and raising demand for services helping to improve the commercial case for investment. Step Change 2015 The Step Change 2015 procurement (Programme 1 of the Plan) is the most immediate and significant element of the Plan to date. The procurement is currently underway with contract award scheduled for late summer Through the use of central funds, the Scottish Government have committed to ensure that 75% of premises within each local authority area are provided 7 STC1D2V2.0 Page 17 of 52 March 2013

20 with next generation access 8 from the selected supplier. Timescales for implementation are by the end of 2015, although feedback from industry does suggest that these timescales are tight Urban Broadband In 2011 the UK Government set out details of a 100 million Urban Broadband Fund (UBF) to create up to ten super-connected cities across the UK, with ultrafast broadband (80-100Mbps) connectivity. Edinburgh was the only city in Scotland that met the criteria and is currently in planning stage. A further Round 2 of the fund was announced in 2012 which accepted bids from cities with a Royal Charter and urban dwellings of greater than 45,000, for a share of a 50m fund to create ultrafast provision. Aberdeen and Perth were successful in their bids and are now in their early planning stages. Despite representation, Stirling was not allowed to bid due to size. The funds will be used to provide ultrafast speeds within the city centre areas and also provide wireless connectivity through both mobile and WiFi infrastructure. Different models are being pursued but in general a gapfunded solution is being used for the fixed ultrafast broadband provision (similar to the Step Change model) and a concession model is being used for wireless provision where access is offered to Council assets such as street furniture. Through the Scottish Cities Alliance, knowledge share is being established between Scotland s cities including Stirling and this should provide valuable insight into potential projects for Stirling at a later date. The recent funding to Glasgow from the Technology Strategy Board for a Future Cities Demonstrator also provides for knowledge share amongst the cities, which again should bring benefit to Stirling. There are as yet no indications that a further round of UBF funding will be made available. 8 Note that Next Generation Access is considered to mean connection to a next generation infrastructure. Next Generation Broadband is generally accepted to mean downloads speeds greater than 24Mbps STC1D2V2.0 Page 18 of 52 March 2013

21 3.6.3 Community Broadband Community Broadband Scotland is a programme from Scottish Government, delivered through Highlands & Islands Enterprise, to support communities wishing to develop their own local broadband networks in the absence of commercially available services. A seed fund of 5m has been committed with six pioneer projects initially identified to progress and a call for further interest in early The objective behind the scheme is to provide a hub for communities to receive and share information and also for provision of funding support for certain capital items involved in planning and setting up local networks. The initiative has created significant interest within communities across Scotland who have broadband issues and do not see upgrade activities planned in their area. The first step however, must be to identify how far the Step Change programme is likely to reach across communities and this may take some time to determine. With the procurement contract award scheduled for mid-2013, a period of survey and coverage confirmation will take place by the successful supplier for a number of months following and so it is likely to be late 2013 before implementation plans are finalised. However, it is likely that the most remote communities will not be covered by Step Change and so options for these could be developed earlier given community resource and commitment. STC1D2V2.0 Page 19 of 52 March 2013

22 4. Broadband Technologies 4.1 Introduction This section presents a summary of the most common Fixed and Wireless broadband solutions, and their suitability for providing Next Generation and/or Basic broadband services to rural premises. A quick comparison of some of the key distinguishing factors is provided at the end of the section. Further detail on the technologies is provided in Appendix B. 4.2 Basic Broadband ADSL ADSL and ADSL2+ are currently the most widely deployed methods of receiving broadband in the UK. They are provided to end-users over the legacy copper telephone network with DSL equipment installed in the local exchange to enable this service. ADSL provides maximum download and upload speeds of up to 8Mbps and 0.8Mbps respectively and ADSL2+ provides maximum download and upload speeds of up to 24Mbps and 2.5Mbps respectively. The copper line length between the local exchange and customer premise and the quality of the copper line determines the actual speeds experienced by the customer. Copper lines can be unbundled at the local exchange, which is when Service Providers install their own ADSL/ADSL2+ equipment in the local exchange to terminate the customer s copper line, and connect them to their own network to provide access to the Internet. This allows competing service providers to offer different services and service levels to BT. STC1D2V2.0 Page 20 of 52 March 2013

23 4.2.2 Exchange Activate Exchange Activate is a BT product that offers broadband speeds of up to 0.5Mbps from a number of rural exchanges in Scotland that have not been enabled for full ADSL services. This is largely due to a lack of backhaul connectivity from the local exchange to the wider BT network. The service is similar to full ADSL although speeds are capped at 0.5Mbps, the number of subscribers from any exchange is limited to 30 (more modules can be added) and the number of ISPs are limited, often with only a single ISP available. There are two such exchanges in Stirling Council; Trossachs and Inversnaid. For these exchanges, an upgrade to full ADSL or ADSL2+ can provide a significant uplift in experienced speeds, particularly if the premises are located near the local exchange BET (Broadband Enabling Technology) BET is a solution developed by BT Openreach, which aims to extend the reach of ADSL services to customers on long line lengths from their serving exchange. Additional equipment is installed in the exchange, and at the customer s premises. BET utilises two copper pairs per premise to deliver broadband speeds of up to 2Mbps, or a single copper pair to deliver 1Mbps, and on line lengths of up to 12km from the serving exchange. The cost of the BET equipment per premise is significant being in the region of 1,100 per customer installation Satellite Broadband Satellite broadband is capable of providing a service to almost all premises in the UK, as it only requires a clear view of the southern sky in order to receive a two-way service. Peak download and upload speeds of up to 18Mbps and 6Mbps respectively are currently available. However, satellite broadband works by sharing an expensive but limited resource across a large number of end users. Because of this, the service is subject to very high contention and the median broadband speeds experienced are likely to be lower than the peak speeds advertised and low STC1D2V2.0 Page 21 of 52 March 2013

24 data usage caps are typically applied to most packages, unless an additional premium is paid. The service is also affected by latency that causes issues with certain types of delay sensitive traffic. Given the ubiquitous availability of satellite broadband, it can be an attractive solution for the hardest to reach premises. However, satellite broadband is subject to disadvantages due to the nature of delivery, which include low data usage caps, variable achievable speeds and much higher latency. As such, it is considered a last resort solution where reasonable line access speeds are not achievable by any other method. 4.3 Next Generation Broadband Fibre to the Cabinet (FTTC) FTTC requires the provision of fibre optic cables between the serving exchange and a street cabinet. Electronic equipment known as VDSL2 is installed in a new street cabinet, adjacent to the existing cabinet, to deliver broadband services to end premises over the existing copper lines. By doing this, the length of copper between the DSL equipment and the end user premise is shortened, allowing for faster broadband services to be offered. This is shown in Figure 4.1. Exchange Fibre street cabinet Copper Figure 4.1: Fibre to the Cabinet (source FarrPoint/Atkins) Currently, FTTC is not available to premises that are served directly from the exchange (so called Exchange Only EO lines), as opposed to those that are served through a street cabinet. However, BT Openreach is currently trialling a new product that consists of a new street cabinet installed outside the exchange to connect the EO lines, and it is anticipated that this product will shortly be available for deployment. In the UK download speeds of up to 80Mbps and upload speeds of 20Mbps are currently offered. Like ADSL/ADSL2+ the access line speed experienced STC1D2V2.0 Page 22 of 52 March 2013

25 will vary dependent upon a number of factors such as the distance from the cabinet, the quality of the existing copper phone line, and noise on the line. The cost of deploying FTTC is predominantly determined by the route distance of fibre required between the local exchange and the street cabinet, and the availability of existing duct infrastructure. The major cost is in excavating and in repairing or laying new duct infrastructure in which to install fibre optic cable, but this can be offset by the relatively large number of premises passed by enabling a cabinet. FTTC is an attractive option for premises that are close to their serving cabinet with customers benefitting from significant speed uplifts Fibre on Demand BT have announced a FTTP on Demand (FTTPoD) product, which will enable end users who are connected to an FTTC enabled cabinet to request and pay for the installation of a fibre to their premises (FTTP) from their cabinet, thus providing access to faster FTTP services. Trials of this service are currently underway and launch pricing has not been announced, however the price will be mainly dictated by the premise to cabinet distance, as the customer must pay the Excess Construction Charges (ECC) for the civil work and installation of a fibre to their premises. An indicative installation cost of 500, plus ECC of 1000 has been quoted for the current trials, based upon a premise to cabinet distance of around 500m. The service is due to be available later in Fibre to the Premise (FTTP) Fibre to the premise is the provision of fibre optic cable all the way from the serving exchange/pop to the customer premise. By utilising fibre optic cables, as opposed to copper, very high bandwidths can be provided to premises, and independent of the line length and interference. Since a new fibre optic cable must be provided to each end customer premise, the civil costs of installing new duct and fibre are significant. As such, the distance to each premise is a major factor in the cost of deployment, making this solution less viable to serve rural premises given the long distances of new duct/fibre build. STC1D2V2.0 Page 23 of 52 March 2013

26 4.3.4 Wireless to the Cabinet (WTTC/FTTC) Wireless to the Cabinet is a technology that is being researched to provide FTTC type services to premises whose cabinet is located in a rural location. A point-to-point wireless microwave connection is installed between the local exchange and the cabinet to provide high-capacity backhaul, instead of providing a fibre connection. Standard FTTC services are then offered from the cabinet, after the installation of local power and electrical equipment. This is shown in Figure 4.2. Microwave Exchange street cabinet Copper Figure 4.2: Wireless to the Cabinet (source FarrPoint/Atkins) This technology is currently being researched with pilot trials planned for It is likely that the only operator to provide this will be BT Openreach Fixed Wireless Broadband (Wireless to the Premise) Fixed Wireless Broadband connects a premise to a wireless service, provided from a fixed location such as local hilltop mast site or the local exchange. This technology encompasses a large range of potential delivery methods such as Wi-Max, WiFi, Whitespaces and 3G/4G technologies such as LTE. The customer requires an antenna to be installed on their premise (whether on the roof, window or located internally) to receive and transmit a signal to a base station, which is connected to the supplier s network. The speeds achieved depend upon a number of factors including the technology used and the received wireless signal strength, which is affected by terrain, visual obstacles and distance from the base station. Some of the available technologies are outlined in Appendix B. STC1D2V2.0 Page 24 of 52 March 2013

27 4.4 Technology Comparison A comparison table showing the main attributes against technologies is provided in Figure 4.3. Note that whilst the table provides a level of comparison, there are often other issues to consider around the suitability and costs of specific technologies and further detail on technologies is provided in Appendix B. STC1D2V2.0 Page 25 of 52 March 2013

28 Technology Theoretical Peak Download Speeds Availability Operators / Deployment Potential Community Involvement Costs Likelihood of deployment to Rural Premises Future Upgrade Path Fixed ADSL ADSL2+ ADSL/ADSL2+ Regenerator BET FTTC FTTP HFC Wireless 8Mbps 24Mbps Currently Available Currently Available BT Openreach, RSPs N/A Low Low ADSL2+ BT Openreach, RSPs N/A Low Low N/A 8-24Mbps Future BT Openreach, RSPs N/A Low High N/A 2Mbps 80Mbps 330Mbps 120Mbps Currently Available Currently Available Currently Available Currently Available BT Openreach, RSPs N/A Medium High N/A BT Openreach, RSPs BT Openreach, RSPs Virgin Media, WightFibre, Smallworld WTTC 70Mbps Future BT Openreach, RSPs 5/5.8GHz FWA Currently Available Many Operators Potential to contribute to capital cost Potential to contribute to capital cost Medium Medium FTTP High Low Potential improvement in performance N/A High Low N/A / FTTP Currently N/A, future potential to contribute to capital cost Potential to Operate / Contribute Medium Low/ Medium Medium Whitespaces Future None Currently Currently N/A Low Medium 3G/4G 2-20Mbps Current /Future O2, Three, Vodafone, EE, N/A Medium/ High High Medium Full FTTC / FTTP Potential improvement in performance Potential improvement in performance Potential improvement in performance STC1D2V2.0 Page 26 of 52 March 2013

29 Satellite 18Mbps Currently Available Tooway, Avanti, others N/A Medium High Potential improvement in performance Figure 4.3: Technology Comparison (source FarrPoint/Atkins) STC1D2V2.0 Page 27 of 52 March 2013

30 5. Step Change 5.1 Background Step Change 2015 represents the Scottish Government s first step towards delivering its strategic targets for While Highlands and Islands Enterprise (HIE) is currently running its own procurement to improve availability of broadband in the Highlands and Islands region, the Scottish Government is entering its own procurement to improve availability of broadband in the Rest of Scotland. As shown in Figure 5.1 this covers 27 local authorities including Stirling Council 9. Figure 5.1: Rest of Scotland Procurement (source FarrPoint/Atkins) 9 From the Rest of Scotland procurement Public Consultation Document STC1D2V2.0 Page 28 of 52 March 2013

31 As stated by the Scottish Government, the primary objective of Step Change 2015 is: to deliver a digital infrastructure with the capability to deliver speeds of Mbps for between 85% to 90% of premises (homes and businesses), with a significant uplift in speeds for those where delivery of Mbps is not possible at this stage. In addition to this overall target, the Scottish Government has indicated a secondary objective: its ambition to ensure a minimum of 75% of premises in each Local Authority have access to Next Generation Broadband (NGB) 10. For Stirling this should mean that Step Change 2015 will ensure 75% of premises in the Council area are connected to NGA infrastructure, however there is no guarantee of the minimum speed to be delivered to these premises. A large number of these premises, located in more densely populated areas, will have access to speeds of over 40 Mbps. Some premises will however have access to lower speeds although they should still benefit from an uplift in speeds compared to the current provision. 5.2 Analysis Methodology The procurement is through an agreed BDUK 11 framework that has two suppliers: BT and Fujitsu. Without wishing to second guess the outcome of this procurement exercise, we have assumed a very BT centric position for the purpose of this analysis, considering that any further rollout of infrastructure would be performed by BT, with FTTC as the primary delivery mechanism. Broadband Classification European Commission guidelines for Basic and NGA classifications colour-code postcodes into Black, Grey and White areas as follows: For NGA: A postcode is turned Black if two or more operators currently, or have plans (in the next three years) to deliver Superfast Broadband; A postcode is turned Grey if one provider currently, or has plans (in the next three years) to deliver Superfast Broadband; Postcodes that currently do not, and are not planned (in the next three years) to receive Superfast Broadband on a commercial basis. 10 Note the difference in terms between NGB and NGA. The 75% commitment may actually end up being NGA coverage rather than NGB 11 BDUK = Broadband Delivery UK, the unit within the Department for Culture, Media, and Sport (DCMS) responsible for broadband policy and delivery STC1D2V2.0 Page 29 of 52 March 2013

32 For Basic Broadband: A postcode is turned Black if two or more operators currently, or have plans (in the next three years) to deliver Basic Broadband (2Mbit/s and above); A postcode is turned Grey if one provider currently, or has plans (in the next three years) to deliver Basic Broadband (2Mbit/s and above); Postcodes that currently do not, and are not planned (in the next three years) to receive Basic Broadband (2Mbit/s and above) on a commercial basis. Commercial Rollout Analysis of the latest BDUK data for Scotland (November 2012) and of BT Open Market Review (OMR) 12 information (as of March 2012) was used to determine the current commercial rollout of NGB in the area. The BDUK data aggregates information at a postcode level about the availability of infrastructure capable of delivering superfast broadband (or basic broadband) in the postcode. This data may come from a number of suppliers and considers the delivery of broadband over a number of technologies, wired or wireless. In reality, apart from some geographically localised cases, most of the infrastructure available to deliver superfast broadband to premises in the UK is owned and maintained by either BT Openreach or Virgin Media. In Stirling, Virgin Media do not to have any coverage even though their core infrastructure goes through the Council area. Therefore the only infrastructure considered is from BT Openreach. The current level of coverage is summarised in Figure 5.2 and indicates that approximately 61% of total premises in Stirling Council will have access to superfast broadband under purely commercial terms by It should be noted however that suppliers are not tied to OMR information in any way and can change their plans at any time. Total premise count Commercial coverage Residential Non-residential Total number of premises premises premises 40,311 2,182 42,493 24, ,722 Coverage level 61.9% 35.6% 60.5% Figure 5.2: Likely Commercial Coverage Before Intervention (source FarrPoint/Atkins) 12 OMR = Open Market Review, an exercise to identify premises which have or will have commercially available broadband service within the next three years STC1D2V2.0 Page 30 of 52 March 2013