Rural broadband firm runs out of cash

The rural broadband firm Next Genus has signalled that it is on the brink of collapse.

On its blog, the company announced that it had failed to find any “viable sources of finance” and would soon cease operations.

The company tried to bring high-speed net services to rural areas by using local champions and private finance.

Rival net firms have stepped in to keep customers connected in some areas, but others have effectively been cut off.

Local action

Next Genus had been using a mixture of fibre cables and wireless to take very high speed broadband (10-60 megabits per second) to some parts of the UK that would struggle to get it any other way.

It provided marketing materials and support to locals to help them generate interest in getting the high-speed service and, once enough people had committed, began putting infrastructure in place to serve them.

The service had proved popular in parts of Cumbria, Lincolnshire and East Yorkshire, where significant numbers of customers had signed up.

Many were cut off this week when the company revealed that there was “no realistic prospect” of it finding enough money to pay its creditors.

In Hull and East Yorkshire, rival Quickline stepped in to keep net connections running – as did ISP KCom in Hull.

In Cumbria, Next Genus’s service was briefly stopped then restarted as talks began with a potential investor. It said it was working to find purchasers for other parts of its network.

Next Genus has not answered any requests for comment.

Its blog said that: “Customers will be receiving an email in the near future giving more information.”

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One Response to Rural broadband firm runs out of cash

  1. And another one !

    The race to connect every British home to the internet has gone into reverse in Cumbria, where two communities will lose their broadband connection at the end of June.

    The Duddon Valley, a beauty spot so admired by Wordsworth he dedicated 34 sonnets to its streams and flowers, and Branthwaite on the western edge of the Lake District, are to have the plug pulled on their broadband by the telecoms group that supplies it.

    Cable & Wireless Worldwide has written to residents to say the public funds raised to pay for the service have expired, and because the connection is “uneconomical”, it is to be withdrawn.

    “If we don’t have broadband it’s going to promptly make some local businesses uneconomical,” said Paul Batten, landlord at the Newfield Inn public house, who along with his father, John, helped install and maintain the broadband equipment.

    “Who is going to move here with children or to try and run a business from home without broadband?”

    The only alternative now is satellite internet. Ramblers in search of Wordsworth’s golden daffodils may soon find themselves confronted with a host of big white dishes, in an area dotted with National Trust farms. Many residents are wary of satellite technology, which is more expensive and can be prone to interference from the weather.

    Farmers, guides, bed and breakfast owners, home workers and the local outdoor activity centre saw their businesses transformed four years ago when Cable & Wireless’s Demon internet arrived in the Duddon valley.

    Blue badge walking guide Tom McCafferty wrote at the time: “This has been my busiest year by far and I feel broadband has been a main contributor to this fact. I cannot believe how I operated without it.” Now he and other residents face being cut off for up to five years.

    The government has said every home in Britain will eventually have access to a basic speed of two megabits per second, which is faster than Duddon’s current service, but the deadline for delivering on this promise is not until 2017.

    Using European money, the North West Development Agency, which was abolished along with all other regional development agencies in March, spent £15m to bring broadband to Cumbria. The investment was made in the wake of the foot and mouth epidemic 2001, which decimated local agriculture and tourism.

    About £500,000 was spent on connections for Duddon, Branthwaite and three other valleys that were all too remote for BT broadband. The hardest-to-reach homes were connected to the internet not via the copper wires but using radio masts, with small receivers on the outside of properties to pick up the signal.

    In Duddon, a television mast installed by the Battens 20 years ago by local people was given an internet link to the local telephone exchange.

    “All this money has been spent installing a system that is now going to be disconnected,” said Lorretta Cookson, who runs an accountancy practice with her husband in Barrow-in-Furness. She lives an hour’s drive away from the office and works from home three days a week. “It’s a horrendous waste of money. The amount of time everybody has put into it – all the forms, all the meetings.”

    The Cooksons are raising their four children at Grass Gars farm in Duddon. “A lot of their school work is on the internet. They can’t do all their work at lunchtime, so it really puts pressure on them if we haven’t got broadband at home.”

    Lack of broadband will be a major setback for Hinning House outdoor education centre, which hosts school trips and operates a bank of 14 computers for children to blog about their encounters with wildlife, complete coursework and video-call classmates.

    “It’s just a shame that the system that we’ve got, which is good and reliable and has not been in that long, is going to be binned,” said Bill Taylor, who helps run the centre. “They are going to throw away a good investment rather than looking at ways of extending it.”

    Residents are upset that the five-year contract with Cable & Wireless has only been in use for four years. It was signed in 2007, but broadband equipment was not installed in Duddon until 2008. “What I find so hard to understand is how anybody could allow this sort of public money to be spent with no serious length of commitment to supply,” said Batten.

    James Barber, the head of supplier performance at Cable & Wireless, said maintaining the equipment was costing more than the income from subscribers. There are 42 customers across both valleys, paying under £20 a month, and the company recently spent over £20,000 on a new electricity cable for the Duddon mast.

    Cable & Wireless tried unsuccessfully to find more public funds. It has struck a deal with a satellite broadband provider, and residents will be offered free installation. “We’ve done our best to find a reasonable and effective solution for the people of the Duddon Valley area,” said Barber.

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