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Labour Lobs Broadband Bomb Into UK Telecoms Market

Paul Rainford
11/15/2019

The UK Labour Party has caused a stir and raised more than a few eyebrows with a promise to provide free full-fiber broadband for every home and business in Britain by 2030 if it wins power in the forthcoming general election.

Not only that, but substantial parts of incumbent operator BT will be nationalized to make it happen, namely Openreach (the quasi-autonomous network access division), parts of BT Technology (which oversees the backhaul network), BT Enterprise (which sells broadband to businesses) and BT Consumer (which sells broadband to residential customers).

A new state-owned entity, British Broadband, will be formed to get the rollout done, and the whole shebang will be paid for through a combination of Labour's Green Transformation fund and higher taxes imposed on tech giants such as Google and Amazon, who are making billions on the back of the UK's broadband network.

As the Daily Telegraph reports, BT's share price stabilized after the initial shock of the announcement, and the operator claimed the plan could cost £100 billion (US$128.7 billion) to implement, as opposed to the £20 billion ($25.7 billion) or so that Labour has estimated for the one-off capital cost.

Labour has estimated the ongoing running costs of the network at £230 million ($296 million) a year, and this is the bit they say will be more than covered by a "system unitary taxation of multinationals, which involves treating multinational companies as single entities, and taxing UK-based multinationals on the share of their global profits that reflects their UK share of their global sales, employment and assets."


For more fixed broadband market coverage and insights, check out our dedicated broadband content channel here on Light Reading.


Launching the plan, Jeremy Corbyn, the Labour Party leader, said: "It's time to make the very fastest full-fiber broadband free to everybody, in every home in every corner of our country. Making it free and available to all will open up opportunities for everybody, at the cutting edge of social and economic change.

"By creating British Broadband as a public service, we will lead the world in using public investment to transform our country, reduce people's monthly bills, boost our economy and improve people’s quality of life."

— Paul Rainford, Assistant Editor, Europe, Light Reading

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