The numbers back up this experience. Although the UK has one of the best levels of broadband coverage in the world, it also has one of the lowest levels of full-fibre coverage, available to just 12 per cent of homes – by comparison, four-fifths of Spanish homes have full fibre. That explains why the UK ranks a lowly 35th in the Worldwide Broadband Speed League compiled by Cable, behind obvious leaders such as Singapore and Taiwan at the top, but also a raft of European ascension states such as Slovakia and Slovenia and even – one place above the UK – Madagascar. The situation has been variously described as a ‘national embarrassment’ – add it to the list.
As it happens, the UK’s network speeds are improving – it’s just that other countries continue to improve too. Catching up the leaders is proving to be an expensive exercise, and one that falls largely on BT as the gatekeeper of the UK’s telecoms infrastructure through its Openreach subsidiary. It’s said that it will spend £12bn rolling out the technology to 20m homes by the mid-to-late 2020s – five times the current level – but one can imagine the final bill for full rollout being much higher.
Our columnist Phil Oakley argues on page 58 that the heavy price to be paid today can be traced back to its earlier decision to wring as much performance out of its old copper network as possible, rather than investing in a new network – milking it for cash as it were to keep its dividends flowing to the many shareholders that took part in its privatisation in 1984. As Megan Boxall explores on page 61, the roots of BT’s current crisis go back a long way.
Like many blue-chips, BT slashed its dividends as Covid-19 struck, although in its case it seems to have used the crisis as cover as it faces up to the huge bill for rolling out full fibre. But shorn of its dividends and offering little clarity on where growth is likely to come from in an increasingly competitive market, its share price has been weakened, and it is little wonder that BT finds itself having to prepare to defend itself from predators (see page 9). A takeover battle may bring a share price boost, but the real value seems to have been buried in BT’s bureaucracy many years ago.
