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BT and Welsh Government agree £425m superfast broadband deal

The Welsh Government claims that it will not only catch up with its neighbours, but overtake them in the deployment of superfast broadband

The Welsh Government and BT have penned a £425 million deal to deploy superfast fibre broadband to 96 percent of homes and businesses by 2015.

BT will invest approximately £220 million in the rollout, the Welsh Government will be contributing £58 million, with an additional £57 million worth of funding coming from Broadband Delivery UK (BDUK), the government body that is armed with distributing funds for fibre projects. Some £90 million has also been secured via the European Regional Development Fund.

Fibre-to-the-cabinet (FTTC) is going to be the primary technology used, which will provide speeds of up to 80Mbps to 96 percent of the population. Fibre-to-the-premise (FTTP) will be deployed in certain areas, delivering speeds of up 330Mbps, but will also be available 'on demand' throughout the entire fibre footprint if businesses want to pay to upgrade the service.

"This is an incredibly important agreement for Wales. Our partnership with BT will see to it that Wales does more than simply catch up with our neighbours: we intend to catch up, overtake and then set the pace that others will strive to match," said Wales' first minister, Carwyn Jones.

"It will ensure that firms remain in Wales and it will also attract a more diverse range of high growth, high value companies to the country across all our key sectors, from tourism to high-end manufacturing."

He added: "We have leveraged over £6 for every £1 invested by the Welsh Government."

According to Ofcom, more than 20 percent of Welsh homes currently receive speeds of less than 2Mbps, which will be reduced to around two percent once the rollout is complete.

BT has also said that the contract allows it to create 50 new jobs and 100 new apprenticeships. Some 320 jobs will also be protected because of the project and the company will offer 900 young people a week's work experience.

"Wales will become one of the best connected countries in the world and will be ahead of the chasing pack," said Liv Garfield, chief executive of Openreach.

However, the project is still subject to state aid and major projects approval from the European Commission. Worcestershire County Council spoke out against the EC this week, claiming that it is holding up the deployment of superfast broadband in the region, as local authorities wait to hear whether or not they are violating state aid rules.

A DCMS spokeswoman told Computerworld UK that the department has been in 'intense negotiations' with the European Commission since January, and hopes to have the funding finalised soon.

"DCMS has agreed with the European Commission that we will put in place an umbrella scheme covering all local broadband projects. This means that one (rather than more than 40) state aid clearance need be obtained from the European Commission," said the spokeswoman.

She added: "Our original notification [to the EC] was in January this year and we have been in intensive negotiation since then. We have provided the Commission with all the information that it has asked for and hope it will be able to give a positive decision shortly."

The UK government has said that it hopes to have the best broadband network in Europe by 2015, and has committed a minimum of £730 million up until 2015 to support the rollout.


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