UK ISP BT has today published the latest biannual progress update on their delivery of Ofcom’s flaky 10Mbps Universal Service Obligation (USO) for broadband. The internet provider has so far helped to build a USO connection to over 7,954 premises (up from 7,681 in Oct 2023), with 265 further builds in-progress (up from 185).
The USO, in case anybody has forgotten, is a legally-binding and industry-funded obligation that falls on BT across the UK, as well as KCOM in Hull. In short, people living in areas where they can’t yet receive a 10Mbps or faster download speed, and aren’t expected to be covered by such a network in the next 12-months, can request a service capable of 10Mbps+ downloads (1Mbps upload) from the aforementioned providers.
A cost sharing model also applies here, which means that the providers will “calculate the total excess cost of the build and divide that between the eligible premises. If that amount is below £5,000 per premises (on top of the £3,400), we’ll automatically split the costs“. But some areas can still end up costing hundreds of thousands of pounds, even up to £1-2m, and would thus find the USO route to be unviable (here and here).
Ofcom states that 57,000 UK premises (0.2%) currently fall into the USO gap (i.e. those outside of suitable fixed line, fixed wireless and 4G mobile coverage), which falls to around 400,000 premises if you exclude wireless solutions. But the regulator expects this to fall to around 50k by September 2024, mostly as a result of upgrades via publicly funded schemes (connection vouchers, project gigabit contracts etc.).
Just to be clear about this. Many of those who pursue the USO option via BT say they were offered 4G (mobile broadband) connections via EE, but those actually considered to have been delivered under the USO itself usually get Fibre-to-the-Premises (FTTP). Commercial builds of the latter have also helped to shrink the USO gap.
The gap will continue to shrink as commercial builds expand and the government’s £5bn Project Gigabit programme starts to make progress. The government are currently also exploring how best to reach those who live in “Very Hard to Reach” areas – roughly equating to the same sort of area as the USO is focused upon – and at the same time they’re preparing to review the USO itself (here), which could lead to changes.
BT’s April 2024 USO Report
The latest statistics continued to show that the delivery of USO connections is slow (e.g. over a year ago there were 2,000 builds in progress, which fell to 800 in Apr 2023, then 185 in Oct 2023 and increase a bit to 265 now). We suspect this may be a combination of factors, such as a lack of consumer familiarity with the USO (apply for it here) and the fact that the policy may also be starting to run into the limitations of economically viable deliverability.