The
Digital Britain report just published aims to provide a
blueprint for an economy based on a high-speed digital
communications infrastructure.
There is a clear benefit for consumers: the benefits for the
producers are less clear.
Mark Vickers, CEO of telecommunications network provider
NetServices,
said the speed increases would probably benefit media users for
entertainment, but businesses needed reliability and quality in
their broadband service. These were presently delivered through a
service level agreement, not by speed alone. "If market penetration
is to increase, it will do so when business users can work from
home with these criteria met," he said.
Communications minister Stephen Carter said as much at the
launch of his report. He said the five paragraphs devoted to
business communications were a "weakness" of the 240-page report.
He said most large and medium enterprises were "sophisticated"
communications users. Smaller firms, the vast majority of UK
companies, were likely to benefit from the consequences of the
Digital Britain policies, which would address issues such as access
to high-speed internet, security and reliability, he said.
Carter said the first such benefit was that the government would
test all aspects of the resilience of the national network
infrastructure later this year.
The government was giving communications the same status and
attention as it gave the transport infrastructure, he said. As a
result, Ofcom, the communications regulator, would also have to
report every two years on the networks' fitness for purpose.
The government would also introduce legislation to address
intellectual property protection online, converting radio to
all-digital broadcast, the universal service commitment, using
public services to increase the amount on online content in the
market, and enable video games to claim tax relief for British
cultural content.
But this does not go far enough for some.
Carolyn Kimber, chairman of the
Communication Managers'
Association, whose members spend £15bn/y on communications,
wants a new Communications Act that balances better the interests
of businesses and consumers. She said, "The CMA would have
preferred to see an unequivocal commitment to carrier-neutral, open
access networks as part of a revised universal access
obligation."
The report preserved the "stranglehold" that BT and Virgin Media
have over core networks, said Chris Smedley, chief executive of
Geo, a private fibre network
operator.
"Digital Britain (has) condemned the UK to an extended 'copper
age'," he said. "It was meant to provide a framework to upgrade and
modernise the UK's digital networks, but instead leaves us still
dependent on antiquated copper networks for broadband."
Mark Seemann, product & strategy director for
Genesis Communications, a
fixed and mobile host that serves some 25,000 small and medium
firms, agreed. The copper infrastructure would restrict broadband
speeds to around 50Mbps, he said.
"If the underlying infrastructure was changed to optical fibre,
the speeds today could be 100Mbps per customer rising to 1Gbps.
This would make feasible the most advanced business applications,
such as high definition video conferencing and streaming complex
software over the web," he said. These were impossible with today's
broadband technology, he said.
Countries studied by the Broadband Stakeholder Group, such as
Australia, New Zealand, Singapore and Finland, were planning to
install fibre to 75% to 100% of homes, which would give residents
100Mbps. South Korea was planning to introduce a 1Gbps service
soon.
Carter offered little to content creators, whom the government
hopes will take over from bankers as the drivers of the economy.
But there is likely to be cash for local and regional news
organisations to make up for the slump in advertising revenue, and
video game makers may get tax relief.
Carter seemed more concerned to preserve existing content
distributors, such as the BBC, ITV and Channel 4, albeit in
modified ways. But he made it clear that content owners and
distributors would have to come to terms with digital
distribution.
The mobile phone sector shows precisely how vital to real
economic growth are applications, content and peer to peer social
networking. Unless the government takes this into account, Digital
Britain risks a life on the shelf.
Government intervention in superfast broadband around
the world
Australia: A$43bn project to deliver fibre to
the home (FTTH, capable of 100Mbps) to 90% of homes; 12Mbps to the
remaining 10%. Public to own at least 51% of the project. Minimum
A$2,750 (£1,350) per household, depending on public sector share of
investment.
New Zealand: NZ$1.5bn of public money to be
used alongside private investment to deliver FTTH to 75% of homes.
NZ$1,000 (£390) per household.
Singapore: $0.75bn of public funds available to
deliver FTTH to 100% of homes. $715 (£450) per household.
Finland: By end of 2015, 99% of homes will be
within 2km of a fibre connection. 95% of homes will be served by
the market. The remaining 5% will be two-thirds funded by public
investment of €133m. €55 (£47) per household (additional investment
required to connect homes to fibre infrastructure).
Greece: €0.7bn of public investment, with a
further €1.4bn of private investment, to deliver FTTH to 2m homes.
€192 (£160) per household.
USA: Stimulus package includes $7.2bn for
broadband projects, some which is to stimulate investment in
superfast broadband, although most is to expand current broadband
services. $63 (£40) per household.
UK: Final Third Fund to raise £1bn over seven
years to bring superfast broadband to every home. £6 per household
per year; £42 per household over seven years
Source: Broadband Stakeholders' Group