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Creating a Competitive EnvironmentDavid CullenDirector, ITS Technology Group
The Three main challenges:
Impact of Gap Funding on other investment
The ‘Cost Cliff’ of new infrastructure
Encouraging High Adoption
Gap Funding
Favours an encumbent and strengthens the 'vertically integrated stranglehold: You need to have an active network to
identify the gap in the business plan the funding will fill! Re-enforces existing ‘traditional’ business model integrating infrastructure owner, network operator and service provider- each having different margin and ROI profiles
Drives behaviour to ‘bolster up’ existing network infrastructure
Transformational Networks need:
New business and commercial models, to Develop new 21st century infrastructure Attract new and varied investment sources
Consultancy
• Ensure that our proposal meets all procurement, funding and State Aid hurdles
Innovate
• Think outside the box for creative ways to fund projects
Diverse Models
• Choose from a host of commercial models that assist our clients to achieve their objectives
Concession
• Reuse existing infrastructure – like Hammersmith & Fulham
Commercialise
• Use sales fire power to exploit existing anchor tenants to generate diverse revenue streams
Community
• Harness community investment and resources – Like Fibre GarDen
ITS’ Commercially Agile funding approach
The ITS AssetCo and OpCo Approach
A commercial model that make the roles, risks and benefit clear to all parties-
Encouragesmany varied funding streams
Cost Cliff of new infrastructure
• Fibre and Wireless networks are cheaper to run once the physical infrastructure to provide them is there
High cost of civils is the obstacle• ITS- engages in ways to massively
reduce the civil construction costs. eg:Community Assistance for a
Professional Network build ( in Fibre GarDen);
Re-use of existing ducts through concession agreement ( in LB Hammersmith & Fulham)
High Cost of
Civils
The existing piggy banks have
already been used
‘Big, safe’ infrastructure needs ‘big, safe’ capital- and it can come
from many sources
“ITS are proud to announce our partnership with ISP aggregator Fluid Data”
Encouraging AdoptionBuild capital is insignificant in the business plan compared with
achieving strong take-up and adoptionBT has low take-up because it struggles with its own cut-throat
price caps on traditional broadband and how to differentiate a fibre- provided service
Other ISPs struggle to find margin headroom to 'on board' other networks
ITS approach-Pass on
the capital cost
reduction in low
wholesale charges
Generate competitiv
e retail prices at
good margins for ISPs
Create headroom
for integration platform providers
The Proof of the Pudding
Wi-Fi to Social Housing256 flats 4 sites of boutique
student accommodation
FTTH Rural Community Broadband Project
550 homes
Duct Network Concession Agreement
15km of duct
ITS Initiatives already adopting new commercial models, infrastructure cost reduction and ISP aggregation include:
