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ISP owner mulls Scottish problems if Yes vote wins independence referendum

Adrian Kennard, owner of AAISP, has expressed concerns about his company’s ability to provide broadband services should Scotland separate from the UK. 

AAISP is a small niche provider that prides itself on providing specialist technical support to its customers. While it sells a range of ADSL and fibre-based broadband services throughout the UK, Kennard has expressed doubts about whether his company will be able to offer services in two countries. 

Kennard cites the possibility of having to pay corporation tax in two countries, different VAT rates and having to deal with both Ofcom and another telecoms regulator (Scofcom?), as reasons why AAISP might not be able to sell its wares in an independent Scotland. 

What conditions would an independent Scotland create for small ISPs?
What conditions would an independent Scotland create for small ISPs?

“Obviously we can’t say for sure what would happen – nobody knows the details, assuming Scotland even votes for a split, but it sounds like hassle to me.

“So I wonder how many ISPs and other service businesses based in England would simply cut off Scotland, just because of simple commercial common sense.” 

Kennard also speculates on BT’s reaction if Scotland broke away from the rest of the UK. He argues that the cost of connecting remote communities might be passed on to customers without regulatory oversight. 

BT hasn’t commented explicitly about its plans for broadband provision and how a Yes vote would affect the two BDUK (Broadband Delivery for the UK) projects. Openreach GEO Joe Garner has said that there are contingency plans, although it’s not yet known what these are. 

It’s unlikely that Virgin Media would be adversely affected by a Yes vote. Virgin’s parent company Liberty Global already operates in 14 countries, so an extra territory, where Virgin Media already has a presence, wouldn’t necessarily things. 

That said, new legislation could impact positively or negatively on both price rises and an ISP’s ability or willingness to upgrade services or expand networks.  

Budget ISP Direct Save Telecom is also considering its options following a Yes vote but has yet to publish its plans. 

Why it might be problematic or even impossible for UK ISPs to operate should Scotland break away, the Scottish Government has pledged to create a new broadband USO (Universal Service Obligation) should the Yes campaign succeed. 

This would see everyone in Scotland able to get broadband services, although it’s not known if this means a basic ADSL service or superfast fibre-based broadband for all. 

Under the two Scottish BDUK plans – Digital Scotland and Highlands & Islands – 95 per cent of Scottish premises will be able to get speeds of above 24Mbps from 2017 onwards. Those in the 5 per cent stand to get a basic service providing speeds of at least 2Mbps. 

The Scottish Government has announced a separate £2.5 million to go towards the CBS (Community Broadband Scotland) fund, which aims to provide better connections in areas not due to get superfast from either of the BDUK projects. 

The UK Government has also invited bids from ISPs looking to deliver superfast connections to the five per cent across the whole of the UK, using a number of technologies including satellite broadband and FTTP (Fibre to the Premises). 

This £10 million project is currently in a trial phase and it’s unknown how exactly rural Scotland and other remote parts of the UK will benefit. 

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