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Australia has tried to do this with its National Broadband Network and it has been branded one of the biggest infrastructure failures in its history. Set up in 2006, the government’s plan was to roll out full fibre to 93% of all premises, although over the years this was watered down to a “multi-technology mix” using different technologies offering varying levels of speed and service to consumers. “Only one other country in the world has come close to going down this route, Australia,” says Matthew Howett, the principal analyst at telecoms research firm Assembly. “And for a good reason – it’s hard, expensive and fraught with difficulty. Australia’s NBN is years late, massively overbudget and offering speeds and technology a fraction of the original political intention.”
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At telecoms giant Telstra’s October AGM, chairman John Mullen claimed all Australians would have access to high-speed internet at a “fraction of the cost” if the government had not proceeded with the project.
Matthew Howett, principal analyst at Assembly Research, agrees: “Only one other country in the world has gone down this route, and for a good reason. It’s hard, expensive and fraught with difficulty. Australia’s NBN is years late, massively over budget and offering speeds and technology a fraction of the original political aim.”
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Analysts warned that state control of Openreach could bankrupt rival cable providers such as Virgin Media, whose cable network covers half the UK, as well as TalkTalk and smaller challengers.
“What would the poin of their existence be?” said Matthew Howett, an analyst at Assembly. “They would fall away overnight. It would add to the lunacy.”
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Some commentators have argued that Openreach needs a shake-up regardless. Customer satisfaction is low and there have been long delays launching faster broadband in the UK. Only around 10pc of the UK has access to full-fibre despite years of promises.
Matthew Howett, the principal analyst at Assembly Research, pointed to a similar approach in Australia which has caused delays for customers.
“Only one other country in the world has come close to going down this route, and for a good reason – it’s hard, expensive and fraught with difficulty,” he said. “Australia’s NNB is years late, massively over budget and offering speeds and technology a fraction of the original political intention.”
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Matthew Howett, principal analyst at Assembly Research, said: “Only one other country in the world has gone down this route, and for a good reason. It’s hard, expensive and fraught with difficulty. Australia’s NBN is years late, massively over budget and offering speeds and technology a fraction of the original political aim.”
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As policymakers and regulators have been creating conditions to spur more competition with BT, rivals including Liberty Global Plc’s Virgin Media and Goldman Sachs Group Inc.-backed CityFibre have been jumping in to commit billions of pounds to infrastructure plans.
“Those plans risk being shelved overnight,” Matthew Howett, an analyst at Assembly, said in an email. “This is a spectacularly bad take by the Labour Party.”
Analysts are skeptical the government could roll out fiber more effectively than private industry and Howett pointed to delays and budget overruns from a state-led effort in Australia.
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Matthew Howett, an analyst at Assembly, said the Government's new pledge “will play well into Virgin's hands given their mix of technologies”.
He added: “The only way Boris’s 2025 target for nationwide full fibre coverage had the slimest chance of success was for it to be fudged to include Virgin’s network.”
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Huawei Vice President Victor Zhang said in a statement Monday evening that the government review “gives us confidence that we can continue to work with network operators to roll out 5G across the U.K.”
Based on discussions with three of the U.K.’s four carriers, analyst firm Assembly estimated in April that restrictions on the use of Huawei could delay the 5G roll-out by between 18 and 24 months, resulting in a 4.5 billion pounds ($5.6 billion) to 6.8 billion pound hit to the U.K. economy.
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The consultancy Assembly suggests a partial to full restriction on Huawei could result in an 18-to-24-month delay to the widespread availability of 5G in the UK. The UK would then fail to become a world leader in 5G – a key government target – costing the economy between £4.5bn and £6.8bn.
“If we had banned Huawei and everyone was just using Ericsson, we would have had a day without any mobile coverage on any network – not a good position to be in,” said Matthew Howett at Assembly.
“There is the whole debate about where the core and access network are delineated,” said Howett. “But the reality is that the operators are all using Huawei to an extent – they are quite happy with it. The government has huge ambitions for what 5G can deliver to the economy, and a bad decision based on politics could seriously stop that from being a reality.”
