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Written Statement - Superfast Cymru Progress Update

Ken Skates, Deputy Minister for Skills and Technology

The roll-out began in earnest in January 2013 and is progressing well.  Fast fibre broadband has now been made available to around 135,000 premises and we expect to have enabled around 480,000 -  about one third - of households in Wales by Spring 2015.

The Superfast Cymru programme is one of the most ambitious in the UK. Our aim to reach 96% of properties by the end of Spring 2016 means that fibre based broadband will become available to more people more quickly than the rest of the UK. Compared with the rest of the UK we have a bigger job to do. Elsewhere this problem affects the so called “final third” of premises.  In Wales we have had to intervene to provide superfast services to around half of the total premises because the scale of market failure here is greater than the rest of the UK.

Superfast Cymru will mean that the majority of businesses and homes will be able to access broadband download speeds in excess of 30Mbps by 2016.  At least 40% of all the premises in the intervention area will also benefit from access to services in excess of 100Mbps. This is in line with the EU's ambitions for widespread superfast broadband by 2020.

Of the 134,707 premises we have accepted so far, 5,184 have been classed as business premises, or 4% of the total premises passed. Current take up figures for cabinets that have been in place for over one year are around 19%.

We have recently published a list of the 53,000 postcodes which comprise the Superfast Cymru intervention area.  These postcodes cover around 730,000 premises.  The programme aims to provide fast fibre broadband to 95 per cent of these, over 690,000 premises.  Superfast Cymru when combined with commercial roll-out will give 96% of all premises in Wales access to fast fibre broadband by 2016. In the areas covered by just the Superfast Cymru programme 95% of premises will have access to fast fibre broadband. The remaining 5% will receive their existing service but will be the subject of further targeted intervention as part of our efforts to tackle the remaining 4% of all premises in Wales as set out below.

The technology used to provide fast fibre broadband may vary from exchange to exchange, and even within exchange areas.  For example, a new cabinet may be installed to provide Fibre to the Cabinet (FTTC) technology or fibre may be provided directly to premises, known as Fibre to the Premises (FTTP).

However, the roll-out of the Superfast Cymru programme is based on delivering contracted speeds rather than the use of particular technologies and we employ the most appropriate solution to deliver these speeds. The current average speed resulting from the programme is 61Mbps – more than twice the contractual minimum speed and 44Mbps above the UK Broadband average.

We carry out a rigorous testing and verification process to ensure that we only pay for premises which exceed the speed thresholds, and are eligible for payment under the contract.  We will shortly be publishing details of the approach we use to testing and verification on the Superfast Cymru website, along with a summarised description of the outputs and controls afforded to us by our contract with BT.

The switch to superfast from “normal” broadband will not in general happen automatically, consumers will have to actively elect to be transferred onto a superfast connection once the service is available to them. Anyone wishing to take up the service in an area once the service is enabled should contact their ISP or use a comparison website to identify a suitable provider.  

Our contract with BT means that the wholesale price which BT charges to ISPs for a superfast broadband service is benchmarked against the prices for the same service in major UK cities.  End users should therefore not be disadvantaged compared with the rest of the UK.  Again though, this is dependent on the choice of Internet Service Provider.  According to Ofcom the price paid by end users for superfast broadband has reduced significantly since its launch, and the UK is amongst the most competitive markets in Europe for superfast broadband.

Up to 4% of premises in Wales are not currently expected to be served directly by either the Superfast-Cymru project or commercial roll-out. Those premises not covered will be scattered across all parts of Wales; not necessarily in rural areas, but where the local situation presents engineering challenges.

In February 2014 an industry facing Open Market Review was conducted to identify locations not covered by either commercial or Superfast Cymru roll-outs. The review process will conclude with a public consultation which is now live.  The findings will be used to target measures to bring high-speed broadband to those premises.  

We have been allocated £12.1m from the UK Government towards the cost of addressing the final few percent of premises. We intend to immediately embark on measures to ensure that premises have access to Superfast Broadband after the completion of this State Aid Public Consultation and approvals.

The resulting Superfast Broadband Infill Project is to be delivered in two phases.  Both phases will seek to deploy superfast broadband to areas which will be defined following the close of the public consultation.  The second phase will also incorporate premises within the Superfast Cymru programme intervention area which are not passed as part of that programme.

The first phase of the infill project will complement the commercial and Superfast Cymru roll-out with rapid provision of superfast broadband with comparable speeds and service provision, and within the same timescales as Superfast Cymru.  The second phase project will commence once the Superfast Cymru project concludes.

Its important that as many people as possible are able to get the most out of our investment in technology. This is why digital inclusion work, delivered through Communities 2.0 led sessions, will align to Superfast Cymru roll out areas to help highlight how people’s lives can be enhanced by the internet.

For those areas not covered by the forward roll-out plan of the Superfast Cymru project, we operate the Access Broadband Cymru grant scheme.  This provides up to £1,000 towards the cost of an alternative broadband solution for premises which cannot achieve more than 2Mbps.  Those residential and business premises benefiting from the scheme are experiencing an average broadband download speed of 10Mbps, compared to a pre-application download speed of under 2Mbps.

As well as encouraging your constituents to register to receive up to date information about the roll-out on the Superfast Cymru website: www.superfast-cymru.com, I would also urge you to encourage them to participate in the public consultation on the locations of premises not covered by either Superfast Cymru or commercial roll-out.  

Finally, I would be grateful if you could encourage constituents in areas which have already benefitted from superfast broadband to consider switching.