DLA Piper has worked recently on many projects concerning FTTP (fibre to the premises) investments throughout Europe, and especially in the UK (including acting for Axione on the GBP£300m formation of Axione Fibre, for Northleaf on the GBP£100m acquisition of Quickline, and G Networks on their GBP£1billion fundraising as well as at least 10 others).

One critical issue that comes up on projects concerning fibre is the definition of “premises passed” (or “homes passed”). This key concept is intended to allow monitoring of the breadth of a broadband network, and the pace of its construction and it is used commonly in fibre finance projects as a trigger for the release of funds, as well as of monitoring management performance (eg by looking at the “cost per premise passed”).

The problem is that there does not yet appear to be a settled industry-wide definition. We have seen the concept defined in wide ways (along the lines of “the network passes within X meters” of the premises) so that a fibre on pole within, say, 10m of a property may count as “passing” that property – but the issue with that is that there might still be some insurmountable obstacle (like a river) between the network and premises!

We have also seen narrower definitions used – such as one where the premise is “passed” if it would be possible for the customer to receive a service without the need for any further construction other than within their own land. This would allow a premise to be “passed” if the fibre ran in a duct on the street outside the home, even though some further construction work might be needed to dig within the customer’s own land.

The narrowest definition we have come across refers to having a connection to the “connectorised block terminal” (CBT) serving the premises concerned. This refers to a connection point allowing service directly into the building – and it’s a term often in the UK used where the service provider commissioning the construction is making use of Openreach’s ducts or poles (via a regulated service called “passive infrastructure access” or PIA) to place its own fibres within the Openreach network. In principle if a CBT is connected then it should be possible to provide service to the premise concerned with just a few hours of additional work.

The OFCOM definition for full fibre coverage used for their annual Connected Nations report for the past few years is “where the network has been rolled out to a ‘lead-in’ that will serve the consumer end premises and where the consumer would expect to pay a standard installation charge for that connection”[1]. Whilst this may suffice for their report this definition probably doesn’t have sufficient certainty to be used in legal documents because “lead-in” is not defined, and also, more seriously, because it may be difficult to prove what customers “expect”.

A further issue to consider is that of multi-occupancy buildings.  If you have a fibre running past an office building with ten tenants, is that one “premise passed”, ten “premises passed” or none at all if there is no riser or similar facility within the building itself allowing individual tenants to make a connection?

Whilst there are still a wide range of techniques used to build or install fibre networks, we are probably still some way from a common definition of a  building being “passed” but it is certainly worth bearing in mind that the different definitions can create quite different results – and so caution should be used, in particular when trying to compare costs or progress between different network operators.

[1] See the 2021 methodology at https://www.ofcom.org.uk/__data/assets/pdf_file/0023/229505/connected-nations-2021-methodology.pdf – definition of “full fibre coverage”