N3 plans unclear after shake up of aggregation boards

According to the DTI, Regional Development Agencies are to decide whether or not to continue funding regional allocation boards (RABs), the vehicles for aggregating public sector broadband demand. The move is likely to radically limit the role of regional aggregation in public sector broadband purchasing and, by implication, N3.

Already the indications are that RABs, also known as Adits, will only continue in parts of England.  EHI has learned from the DTI that at least three of the nine RABs in England will be disbanded – South West, South East and North West.

In February 2004 the Department of Health awarded a £530 million, seven-year contract with BT to deliver N3.  Under the contract BT was to act as an “integrator” and “aggregator" rather than directly providing broadband services.

Welcoming the contract, UK e-commerce minister, Stephen Timms said on 19 February in a National Programme for IT press release: "BT will buy their broadband connectivity thought the Regional Aggregation Bodies (RABs) that have been set up to aggregate public sector broadband demand.

“Awarding the N3 contract is the first step in bringing an immensely influential pool of public sector broadband buying power into the market."

However, E-Health Insider has learned that just £9m of aggregated broadband contracts that have passed through the RABs with only a fraction attributable to the N3 contract.

A DTI spokesperson told EHI that so far £9 million of broadband procurement had passed through the RABs but added very little of this had so far been attributable to N3 as the NHS programme was running late.

“The anticipated contract value through N3 has not transpired as there are delays to the NHS IT programme as a whole, so the contract value through N3 has not been at the anticipated values,” said the spokesperson.  “Little or any of the £9m contract value aggregated through the RABs has come through N3 aggregation."

Asked how this would impact on the roll-out of N3, the National Programme for IT responded: "The disappearance of the National Aggregation Board and some of the Regional Aggregation Boards has not put the roll-out plans for N3 in disarray as reported by E-Health Insider on 6 December 2004.

"It was never the intention that the N3 service provider (BT) contracted via the Regional Aggregation Boards.  The relationship was with the National Aggregation Board who then passed out the bundles (a number of requirements for a RAB area) to the regions.

"While this relationship is now finishing, the contractual instrument in use – the Department of Trade and Industry Framework Contract with 17 suppliers – is still in place and the N3 service provider will still be able to utilise it.

"So far between 60-70 per cent of the delivered connections have not been provided by BT but by suppliers who are on the DTI 17 supplier list.

“The National Programme’s target is to have 6,000 connections by 31 March 2005 and BT is firmly committed to this target. Indeed to date there have been more than 1,300 sites which have received broadband connectivity via the N3 contract."

EHI asked NPfIT to clarify the apparent discrepancy between the clear February statement by Stephen Timms that under N3 BT would buy broadband through the RABs and its statement this week that this was never the intention. 

Late on Thursday afternoon NPfIT qualified its Wednesday statement by saying. "It was never the intention that the N3 service provider (BT) contracted directly via the Regional Aggregation Boards." 

A draft document leaked to Silicon.com highlights flawed business plans, rushed implementation and lack of take-up from the NHS and education sectors as the key factors in the failure of the National Aggregation Board.

Silicon.com says: "It was expected that some of the broadband connection sub-contracts that BT was expected to put out to tender would be contracted, through the Adits, to other telcos.

"In reality, however, this has not happened and the report says any future revenues for the Adits from N3 are likely to come from consulting fees rather than being the contracting party as originally envisaged.

“Silicon.com understands that the Adits missed out on lucrative N3 contracts because their procurement process was too slow for the faster paced NHS procurement timetable – taking almost twice as long in some cases."