Guidance

Open Market Review (OMR) and Public Review (PR) - Subsidy Control Classification Guidance

Updated 26 July 2024

1. Introduction

1.1. This document provides guidance on the Open Market Review (OMR) and Public Review (PR) stages of the Government’s Gigabit Infrastructure Subsidy scheme (GIS), part of Project Gigabit.

1.2. GIS builds on the successful National Broadband Schemes in 2012 and 2016 (NBS 2012 and NBS 2016) to provide funding for the premises which are unlikely to receive gigabit-capable broadband within a reasonable timeframe, if at all. We estimate this to be approximately 20% of premises within the United Kingdom.

1.3. Within GIS, one of the key tasks in ensuring that public subsidy is only spent where it is needed is correctly identifying intervention areas which contain only premises for which there is no gigabit-capable infrastructure, either at present, or where it is not likely that such infrastructure will be built within the next three years.

1.4. For Building Digital UK (BDUK), gathering reliable market intelligence is key to preventing overbuild of existing gigabit-capable infrastructure or credibly planned gigabit-capable infrastructure, and to ensuring that good value for money is achieved. The Superfast evaluation identified the OMR as an important process in gathering such intelligence, and one which contributed to the programme’s effectiveness. An OMR involves a formal engagement with all known suppliers to ascertain existing network provision within the captured area, and is intended to act as a precursor to a formal Public Review (PR) process to confirm premises eligible for subsidy.

1.5. As with NBS 2016, before issuing the requirements to market, BDUK - and other implementing bodies - will run a PR to allow infrastructure providers to clarify whether they provide services to any of the target premises or have plans to do so within the next three years which have not been captured in the OMR process. All responses to the PR (including sufficiently detailed updates notified as part of the continuous OMR process received prior to the closing date of the project specific PR) will be reviewed and any coverage claims - either current or planned - will be assessed and have subsidy control classifications applied to them in order to identify the target areas of any subsequent procurement.

1.6. For more detailed information on GIS, please see the Detailed Overview of the Gigabit Infrastructure Subsidy scheme document published by BDUK.

2. Open Market Review (OMR)

2.1 What is an Open Market Review?

2.1.1. The OMR is a survey of completed and planned broadband infrastructure which is used to inform the design of procurements and other interventions. It is important that as much information as possible is available so that interventions can be designed to be complementary to commercial plans.

2.1.2. The OMR process will form part of a wider BDUK effort to continuously collect data at Unique Property Reference Number (UPRN) level to identify the eligible target areas for subsidy under the GIS. The OMR process will also be updated regularly (see Rolling Open Market Review below)  and  the outputs will be utilised in procurements to establish the eligible target areas against which suppliers will be able to bid.

2.1.3. It is important that suppliers respond with the information requested in the OMR Request For Information (RFI) document, as this is the first stage in our identification of areas which need, or do not need, intervention and better data at this stage will allow us to do this with greater precision. Early engagement allows as much time as possible for assurance, and will limit the need for clarification questions (CQs) in respect of supplier responses throughout the process.

2.2 Rolling Open Market Review

2.2.1. We are keen to receive data from suppliers for the whole of the UK on a rolling basis.  Many suppliers have provided national data to us but to ensure we had complete data, we have until recently issued OMRs and PRs area by area.  BDUK  has now  implemented a national “Rolling Open Market Review” for all suppliers three times a year; timed to align with returns to Ofcom Connected Nations, and consisting of a regular data return equivalent to the data collected at OMR/PR stages.

2.2.2. The data submitted to the Rolling Open Market Review will be processed in the same way as that submitted to the current OMRs and will be used to make a mapping categorisation of UPRNs. This will generally be fed into a PR process for new areas in the way described below. However, If BDUK receives new data for UPRNs which have been the subject of a previous PR determination, if it meets the evidential requirements, BDUK may use this data to update the previous areas by area PR determinations at our own discretion.

2.3 OMR Process

2.3.1. During the OMR and PR stages of the GIS, BDUK will utilise various data sources in its assessment of each UPRN in an area. These sources include:

• Internal BDUK data - information from previous projects such as Superfast and Vouchers schemes
• OFCOM - connected nations reports which have been imported into BDUK databases
• Suppliers - information provided by suppliers in response to the OMR and PR requests for information (RFIs)
• Local Bodies (LBs) - may possess relevant local information eg from suppliers, businesses, residents, and information on previous/current local infrastructure projects such as Superfast. LBs will be supporting BDUK during the OMR and PR phases

2.3.2. BDUK will carry out an OMR by issuing an RFI to suppliers about their current broadband network coverage and any future plans to roll out broadband infrastructure, particularly within the next 3 years. This RFI will be published on the [BDUK website](https://www.gov.uk/government/collections/project-gigabit-programme-open-market-reviews, as well as the websites of any relevant local authorities.

2.3.3. Market engagement will be as wide as possible, ideally to all known suppliers. As a minimum, the OMR will request information from any supplier known to have broadband infrastructure in the relevant area and neighbouring areas. This includes national incumbents, but also any local providers that may have network coverage within the area.

2.3.4. BDUK will engage with suppliers to ensure the accurate classification of their coverage returns and may discuss OMR (and PR) returns with the relevant Local Bodies to assist in this process. Suppliers may raise queries regarding the OMR or PR process within the stipulated time period as stated in the relevant RFI document. BDUK will respond to questions received from suppliers. During the evaluation of supplier coverage claims, BDUK may raise clarification questions (CQs) to suppliers regarding their broadband infrastructure coverage submission.

2.3.5. We will use premises level information we receive at OMR (and PR) to develop intervention areas and so will share in confidence with key staff in Local Bodies.

2.3.6. We will issue at least two reminders to suppliers in the event that they do not respond to the OMR, with the final reminder being sent to the suppliers 14 days before the OMR is concluded.

3. Public Review (PR)?

3.1 What is a Public Review?

3.1.1. The PR allows interested stakeholders (eg the public, businesses, internet service providers and existing or potential national and local broadband infrastructure operators etc) an opportunity to comment on the UPRNs that BDUK intends to target in its procurement. It is the basis on which we will draw a “line in the sand” on which premises are eligible for intervention. BDUK will always carry out a PR prior to the launch of a procurement.

3.1.2. The key aims of the Public Review stage include:

• To review and validate data provided by suppliers to BDUK;

• To provide suppliers who missed the preceding OMR, had no definitive plans and/or evidence base on which to substantiate claims at that earlier stage, or have subsequently updated their plans, a further opportunity to provide information to BDUK before the procurement stage;

• Where we are able to do so, to allow suppliers - and other interested parties - an opportunity to feed back on the proposed shape/size/geography of the proposed Intervention Area (IA) for procurement, and on the proposed commercial vehicles for procurement stage eg Type A / DPS - Local Supplier Contract or Type B - Regional Supplier Contract.  Where we are not in a position to do this, we will be transparent in our categorisation of premises for intervention.

3.2 Public Review Process

3.2.1. BDUK will carry out a PR by issuing a RFI to suppliers about their current broadband network coverage and any future plans to roll out broadband infrastructure, particularly within the next 3 years. The RFI will be published on the BDUK website, as well as the websites of any relevant local authorities.

3.2.2. Every effort will be made to engage with suppliers to ensure the accurate classification of their coverage returns. Suppliers may raise queries regarding the OMR or PR process, within the stipulated time period as stated in the relevant RFI document. BDUK will respond to these questions received from suppliers. During the evaluation of supplier coverage claims, BDUK may raise clarification questions (CQs) to suppliers regarding their broadband infrastructure coverage submission.

3.2.3. The key activities within the PR stage are set out in the flowchart below:

3.2.4. Once launched, the PR must be open for feedback from all interested stakeholders for at least one month.

3.2.5. The procurement process will aim to start no later than six months after the closure of the PR. This is to ensure that subsidy control mapping is as accurate as possible.

3.2.6. We will publish a summary report outlining the changes that have been made to our subsidy control mapping following the PR. This will include postcode level maps of the final UPRNs which have been designated as white. We will redact any potentially commercially confidential information from these reports.

3.2.7. Externally published maps will protect commercially sensitive data ie data on any single supplier’s coverage. This means that only postcode level maps will be released into the public domain.

3.2.8. For the purpose of this mapping (See Section 4.1 - Eligibility Requirements for Subsidy), postcodes have been classified as follows:

• a postcode is classified White if any ‘White’ premises are present
• a postcode is Under Review if any ‘Under Review’ premises are present
• a postcode is classified turned Black if all premises in the postcode are classified ‘Black
• a postcode is Grey (ie all premises are ‘Grey’ or a mixture of ‘Grey’ and ‘Black’)

3.2.9. Note that in relation to mapping released for the PR and subsequent output reports, that subsidy control classification maps are released at a postcode level to ensure that commercially sensitive information is not identifiable in relation to individual premises. That said, the design of intervention areas for procurement will be at UPRN level.

3.2.10. If a supplier does not respond to the OMR/PR stages, however BDUK is aware that the supplier has infrastructure in the area that could be targeted, or may have investment plans in the coming three years that may affect this area, BDUK - or other contracting authority - may contact the supplier directly, or make a determination based on alternative evidence.

4. Evaluation and Classification of Supplier Coverage claims

4.1 Eligibility Requirements for Subsidy

41.1. BDUK will categorise premises as gigabit “White”, “Grey”, “Black” or “Under Review” (WGBU). There will be a preliminary categorisation of premises at the end of OMR stage, which will then be presented to the market at the PR stage.

4.1.2. BDUK will only provide subsidy to target premises that have been designated as White.

4.1.3. Provided below are high-level definitions of each subsidy control classification. Further detail on the application of these classifications is provided further in this document.

• White - indicates premises with no gigabit network infrastructure and none is likely to be developed within 3 years

• Black - premises with two or more qualifying gigabit infrastructures from different suppliers being available, or will be deployed within the coming 3 years

• Grey premises - a single qualifying gigabit infrastructure from a single supplier is available, or is to be deployed within the coming 3 years

• Under Review - premises where suppliers have reported current or planned commercial broadband coverage, but where claimed current gigabit coverage has not been verified, or, in respect of planned build, where evaluators are confident that gigabit infrastructure will be delivered, but some risks to delivery remain, or there are some gaps in evidence

4.2 BDUK is not prescriptive on evidence

4.2.1. It is important to stress that we are not able to provide suppliers an exhaustive list of information or material they can submit to support their claims. We are generally looking for the material a supplier already has put together for its own purposes. We are not expecting suppliers to produce specific documentation for BDUK purposes - we are looking for actual business plans, financial plans and deployment plans, not least to understand suppliers’ own approaches to risk.

4.2.2. BDUK appreciates that all suppliers may have different approaches to planning and delivering their build plans. Therefore, we have deliberately avoided prescribing a specific checklist of information we expect suppliers to submit - there is no single “right answer”.  We encourage suppliers to provide as much information as possible. Each supplier response is assessed on its own merits.

4.3 Application of “Grey” Categorisation

4.3.1. For the Gigabit Infrastructure Subsidy scheme (GIS), BDUK is only designating planned coverage as “Grey” where there are few to no risks and dependencies remaining for build. For premises to be considered as built we would expect to see the Ready for Service date or other evidence that there is service to end user premises. For unbuilt premises to be assessed as Grey, we expect suppliers to provide evidence (but not necessarily the actual artefacts) that demonstrates a firm commitment to build, this could include:

• Planning is at an advanced stage; with detailed design work having been progressed and delivery scheduled for build
• Project plans are in place to start the build
• Build has started or will start within a short timeframe - eg there are contracts with subcontractors in place to commence build on a firm date
• Sufficient capital is available and committed to deliver the specific build
• Risks to completing the build as planned have been identified, and the supplier has demonstrated that mitigations have been put in place to deliver the network as planned

4.3.2. The following additional information/evidence can also support a “Grey” classification:

• Any other measures by which a supplier firms up plans to a final stage before build
• Any other factor which de-risks the level of uncertainty over build plans, such as:
  • A track record of successful build at comparable scale
  • A supplier already operating an existing network neighbouring the build area, which can be leveraged to deliver the project

4.4 Application of “Under Review” Categorisation

4.4.1. BDUK will categorise planned build as “Under Review” where suppliers have provided evidence which gives BDUK reasonable confidence in their build plans being realised, however there exists a risk of those plans not being completed within the three year window. For example, BDUK has categorised build plans as “Under Review” where:

• Funding is agreed in principle but not yet authorised
• Design work has started, but this is not yet sufficiently detailed
• No contracts for build are in place
• Build contracts are in place, but risks and dependencies associated with the build have not been identified/mitigated against
• Other risk factors suggest that build plans may be susceptible to change, or are not sufficiently certain

4.4.2. Suppliers should be aware that BDUK are not able to include any UPRNs categorised as “Under Review” in the contract’s “Initial Scope”, as they are by definition not categorised as White (and thus eligible for subsidy).

4.4.3. BDUK will continue to monitor URPNs categorised as UR after contract signature through an ongoing monitoring process. Coverage claims made at the PR stage against delivery and premises’ will be assessed for subsequent re-classification as grey or white, so it is imperative that suppliers who responded to the PR with planned coverage continue to provide data so that we can confirm whether those premises have received coverage. BDUK will be proactive in seeking this data from PR respondents, asking for evidence (eeg progress against the outline deployment commitment, milestones achieved, detailed reporting on progress made) before coming to a supportable view on re-classification. Only UPRNs that are re-assessed to be White can be considered eligible for subsidy. This monitoring may be limited to the three year validity period of the public consultation or longer if the investment is over a period beyond the three years. If a supplier fails to deliver against the agreed parameters, then unless a revision is agreed between BDUK and the supplier, then the “Under Review” premises may be brought into the scope of the specific contract to which they apply. It should be noted that PRs are valid for a three year period from the date of their closure. Therefore if three years has passed since the closing of the original PR, any premises classified as “Under Review” will require re-evaluation through a further PR prior to the commitment into any contract.

4.4.4. Where BDUK moves to change the classification of UPRNs from that of “Under Review” to that of “White” or “Grey”, we will communicate this proposed change of status in writing, and give suppliers time to provide further evidence before finalising our decision.

4.5 Application of “White” Categorisation

4.5.1. Where suppliers are unable to provide sufficient material for us to have a reasonable level of confidence in the delivery of the build plan, we are obliged to mark premises as “White”. This means that BDUK has determined that, under Subsidy Control law, we are able to include these premises within a GIS procurement.

4.5.2. Please note however that not all premises categorised as “White” at the end of the PR stage will automatically be included in the scope of a potential forthcoming GIS procurement.

4.5.3. The subsidy control classification process provides clarity on which premises BDUK is allowed to provide subsidy in relation to; however, BDUK may choose to omit many premises that have been designated as “White” from our procurements. For more information, please see the Determining Intervention Areas section below.

4.6 Additional Evaluation Considerations

4.6.1. When BDUK undertakes an evaluation of technical and technology data - BDUK will evaluate each supplier’s claimed coverage technology for Gigabit capability (or Ultrafast capability where appropriate) according to the published GIS Programme Technology Assessment Guidelines, which is due to be published soon after this guidance. Broadly, gigabit-capable networks are fibre based networks (eg FTTP, FTTH and FTTB) and certain advanced wireless access networks capable of delivering reliable high speeds per subscriber. However, the final determination of capability will depend upon BDUK’s assessment of supplier’s evidence submitted in the Guideline’s response template.

4.6.2. BDUK will make subsidy control classifications at UPRN level. BDUK discourages coverage returns which provide only postcode level information, and only in exceptional circumstances will BDUK accept this data as sufficient to establish credible planned build.

5. Additional requirements

5.1 Next Generation Access (NGA), Ultrafast and Gigabit-capable Broadband Coverage

5.1.1. The objective of the GIS scheme is to improve the geographic coverage of gigabit-capable broadband across the UK. The programme does not provide basic or NGA broadband subsidy interventions (ie enabling the delivery of speeds of 2 ­- 30 Mbps or 30-100Mbps). Nevertheless, during an OMR and PR, BDUK will carry out a general survey of supplier coverage in all categories (basic, NGA, Ultrafast and Gigabit) together with available download and upload speeds. BDUK may then choose to prioritise the targeting of UPRNs according to existing coverage categories and speeds (NGA UPRNs before Ultrafast UPRNs etc.)

5.1.2. The “White”, “Grey”, and “Black” classifications for NGA and Ultrafast capable broadband coverage are consistent with those set out in 4.1.3 for gigabit-capable infrastructure and these will be determined and considered as part of any prioritisation of target UPRN:

• NGA White areas are areas where NGA networks (capable of delivering reliable download speeds of at least 30 Mbps) do not exist and are not likely to be built within 3 years.

• NGA Grey areas are areas where one NGA network exists or is to be built within 3 years.

• NGA Black areas are areas where more than one NGA network exists or is to be built within 3 years.

5.2 “Step change” Requirement

5.2.2. BDUK requires that public subsidy intervention should be able to ensure a ‘step change’ in broadband availability from that currently available as well as credible planned networks. The data required to evidence step change is collected firstly at the OMR / PR stages and again at the survey and design stage following the contracting phase.

5.2.3. Step change is demonstrated by:

• Generally, download speeds must be at least doubled and upload speeds substantially higher as a result of the intervention when compared with existing download and upload speeds

• Significant new investments in the broadband network are undertaken (ie investments that must include civil works and installation of new passive elements)

• The new infrastructure brings significant new capabilities to the market in terms of broadband service availability, capacity and speeds and or competition.

5.2.4. BDUK may, in exceptional circumstances, choose to fund interventions which fall below the 1Gbps requirement provided that the basis requirement for Step Change is met.

5.3 GIS Interaction With Other BDUK interventions

5.3.1. BDUK will issue OMR/PR guidance to suppliers, requesting that they include in their broadband infrastructure coverage submission, any existing or planned infrastructure for which they have received Government subsidy; for example, existing and planned infrastructure coverage gained through funding from Vouchers, Superfast (NBS 2012 or NBS 2016) and Hubs.

5.3.2. However, in order to avoid duplication of public funding  - and to aid in the creation of intervention areas - BDUK will incorporate our own data from other BDUK interventions into the OMR/PR process. These other interventions are as follows:

• “Superfast” (NBS 2012 and 2016) - using data from C3 reports and Speed and Coverage Templates (SCTs)
• Gigabit Broadband Voucher Scheme
• Local Full Fibre Networks Programme (LFFN), Rural Gigabit Connectivity (RGC) programme and GigaHubs
• Other local body funded broadband infrastructure projects

5.3.3. BDUK will undertake a regular internal validation analysis exercise at UPRN level to avoid public funding being targeted at the same UPRN through more than one BDUK intervention.

5.4 BDUK Treatment Of BDUK Vouchers Data

5.4.1. Coverage claims received from suppliers utilising Vouchers funding will be evaluated in accordance with the Subsidy Control evaluation process, as described above. This means that suppliers’ claims will be assessed against the technology solution being gigabit-capable for existing infrastructure.

5.4.2. Typically, Vouchers premises will be categorised as follows:

• Projects, or before Voucher is issued - “White” (BDUK data assessment indicates a very low chance that these UPRNs will be built to)
• Voucher issued - “Under Review” (around 4% chance UPRN will not be delivered)
• Voucher claimed - “Grey” (should be gigabit-connected)

5.5 BDUK treatment of BDUK Superfast data

5.5.1. Assessments of Superfast data will be consistent with the approach laid out above for the evaluation of GIS coverage returns.

5.5.2. Premises where a gigabit-capable solution has been delivered under Superfast will be categorised as Grey/Black.

5.5.3. Premises where a gigabit-capable solution is planned to be delivered should be categorised as “Under Review”.

5.5.4. Premises with sub-gigabit technology (eg NGA or ultrafast solution) should be marked white. Note that while the NBS 2016 scheme is still delivering contracts in parallel, then any intervention under GIS will avoid projects being progressed (even while these are delivering NGA solutions).

5.6 BDUK treatment of Local Full Fibre Network (LFFN) data

5.6.1. All sites have been contracted under the LFFN programme. Therefore, it is expected that suppliers will include premises built under this programme in their OMR/PR returns. However, BDUK will cross reference LFFN data with supplier returns to ensure contracted sites have been captured.

5.6.2. Sites which have been contracted, however are not complete, will typically be categorised as “Under Review”.

5.7 BDUK treatment of Rural Gigabit Connectivity (RGC) data

5.7.1. The majority of sites have been contracted under the Rural Gigabit Connectivity Programme (RGC).

5.7.2. All RGC sites which are in the ‘Ready to Procure’ stage will be categorised as “Under Review”.

5.7.3. For those sites which have not yet passed this stage, the subsidy control classification will be that of White.

5.8 Future hubs interventions (GigaHubs)

5.8.1. For future hub interventions, the same principle applies: subsidy control classification of GigaHubs sites will be categorised as white until these have passed the ‘Ready to Procure’ stage.

5.9 Changes to a supplier plans post-PR

5.9.1. BDUK is not required to take into account any investment plans announced by suppliers following the conclusion of the PR, save where we wish to do so, including through the Rolling Open Market Review as described in paragraph 2.2 above. If BDUK chooses to do this, it will publish an updated PR Outcome Report, highlighting and justifying the changes. Provided that appropriate mapping and Public Review has been undertaken, BDUK can rely on these results to define their target UPRNs and set the scope of their intervention areas for procurement. This also provides certainty for contracted suppliers in respect of continued eligibility of the contracted scope of the procurement in these circumstances. This is known as the ‘line in the sand’ principle.

5.10 Data errors reported by suppliers post-PR

5.10.1. When the PR has been closed, BDUK will operate the aforementioned line in the sand principle.

5.10.2. However, supplier coverage claims, submitted during the OMR /PR stages, may contain data errors. Data errors may be reported by the supplier, or found during the delivery stage 1 design and survey (ie the first stage of contract delivery).

5.10.2. In cases where data errors have been identified before a procurement has been launched, BDUK will review these errors, and may change subsidy control classifications as a result.

5.10.3. In cases where data errors have been identified before a procurement has been launched, BDUK will review these errors, and may change subsidy control classifications as a result.

6. Determining Intervention Areas

6.1. We use the subsidy control classification of premises to identify where we can intervene, but then consider where we should.  This process is heavily reliant on the market investment plans assessed through our Open Market Review and Public Review processes.

6.2. Our aim is to design interventions which balance room for commercial investment with our fundamental objective to ensure all homes and businesses can access gigabit infrastructure as soon as possible.

6.3. We use the WGBUR classifications, together with our assessment of how to achieve best value and greatest coverage, to define the scope of each procurement:

Accessibility description: the above image is a flowchart showing the implications of subsidy control classifications as to whether URPNs can be placed in the initial or deferred scope of a procurement, or whether they must be left out of scope of a procurement.

• Premises categorised as ‘White’ can be included within the initial or deferred scope of a procurement, or could be left out of scope

• Premises categorised as ‘Under Review’ can be included within the deferred scope of a contract, or could be left out of scope

• Premises categorised as ‘Grey’ or ‘Black’ will always be left out of scope of BDUK procurements

• There is no “Deferred Scope” in Local Supplier contracts: premises are either In Scope or Out of Scope

6.4. In both Regional and Local Supplier contracts, we will only build to premises which have been designated as ‘White’ - premises with no gigabit network infrastructure and where none is likely to be developed within three years. Conversely, unless premises are classified as White, we will not authorise intervention.

6.5. In some cases, we may choose either to defer intervention to some White premises or to descope them from the procurement where we believe that will deliver best value.  For instance, we may descope White premises if they are adjacent to Grey premises, because although there are no declared plans to build there, it is likely to be straightforward to reach them once the Grey premises have been delivered.

6.6. For premises which are included in the Deferred Scope of contracts, we will seek a price from the Regional Supplier, but will not authorise build unless and until they are re-classified as White. We will always either descope ‘Under Review’ premises or defer build to them and we will always descope ‘Grey’ or ‘Black’ premises. There is no Deferred Scope in the Local Supplier contracts: premises are either in scope or out of scope, so Local Supplier procurements will never include Under Review premises in their scope.

6.7. We will continue to monitor and verify telecom providers’ plans, and in the event that commercial plans fall away or are not progressed sufficiently or fulfilled in their entirety, any premises can be re-classified as ‘White’ and will then become eligible for intervention under our contracts.

6.8. This is an inevitably complex process requiring time and effort from telecoms providers and BDUK.  We will assess carefully and treat all telecom providers fairly, based on evidence and are engaging with telecom providers who are new to the market to ensure that the decision making process, and the evidence which informs our decisions, are clear.