Tuesday, April 3, 2012

News: New business model for Digital Region


The company behind the Digital Region project in South Yorkshire is to adopt a new business model following an inquiry into the progress of the project.

The superfast broadband network is being built for the region by Digital Region Ltd in partnership with technology company Thales UK. The £90m project includes £30m from the European Regional Development Fund.

The project was wholly owned by the now defunct Yorkshire Forward and the four local authorities of South Yorkshire. Each authority has agreed to a preferred option to enter into a process to procure a supplier to takeover operations and management of the network in order that the network is available to, and used by, as many people and businesses as possible in South Yorkshire.

Digital Region will move in line with the commercial model being promoted by central government's Broadband Delivery UK (BDUK) for superfast broadband in the rest of the UK. The BDUK commercial model places the majority of risk and liability to a private sector partner. The appointed supplier takes responsibility for all operating costs, sales, marketing and revenue generation.

Digital Region Ltd posted losses of over £9m for 2010/11.

Andrew Bedford, strategic director of resources at Rotherham MBC said: "The new business model aims to ensure that superfast broadband is available to as many people and businesses as possible, whilst also helping to reduce the council's current commitments and future risk. The new plan will help make South Yorkshire competitive with other areas and encourage economic development and growth."

Digital Region Ltd will now work to procure a private sector partner to take over the operations of the broadband network and Digital Region Ltd will make further announcements regarding the tender application in May 2012.

Through a new fibre optic network, the Digital Region project will bring continuous 25mb+ broadband to over 97% of South Yorkshire, including 550,000 homes and 1.3 million people.

The build phase has been successfully completed to time and cost but the roll out of services to customers has been delayed. The operators successfully won a case through Ofcom, the independent regulator and competition authority over BT charging too much for the use of their existing lines to reach customers.

The challenging economic environment and the issues with the Digital Region network caused Rotherham-based Internet Service Provider (ISP), RiPWiRE Limited, to close earlier in the year.

Digital Region website

Images: digitalregion.co.uk/


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