My blog on the deal between O2 and Westminster and Kensington Councils provoked interesting reactions. There seems to be agreement that it undermines the previous government’s path (still apparently being follow by Ofcom and BDUK) back to a regulated communications infrastructure monopoly, albeit still privatised and overlaid with a candyfloss layer of “unbundled” local access. Just before Christmas a former regulator reminded me that Sir Keith Joseph said that there was only one thing worse than a public sector monopoly – a private sector monopoly. I must ask him whether he is among those who now see a realistic prospect of an “open” market based on international standards for operational as well as technical interoperality. They believe that Ministers and policy advisors appreciate that the competition between fixed and mobile operators to provide ubiquitous broadband access over infrastructures built, owned, managed and operated by a variety of players (from Ambridge Community Broadband to Arqiva, Babcock to BT, E2BN to Everything Everywhere etc.,) is more likely to ensure that the UK has the “best” broadband than any centrally planned and regulated solution, however many expensive consultants have worked on it. Ministers are rarely happy to “direct” officials but they are unlikely support those who stand in the way of market-driven solutions given the mounting risk of mobile melt-down this summer.
It is, however, in the nature of politicians to interfere with markets – just as it is the nature of dominant players to “rationalise” markets in their own interests. More-over it is probable that a government reshuffle is imminant, as soon as the LibDems have agreed which of their new intake is ready for promotion to replace those who have passed their sell-by dates. If so, one suggestion to minimise the damage of interference is to move telecommunications from DCMS to a new department which brings together DECC and the Department of Transport, tasked to work with Treasury enable the private sector to bring forward the infrastructure investment programmes that are essential to UK economic recovery. The competing view is that it be moved back into BIS/DTI as part of an “industrial strategy” (alias picking winners and turning them into losers with conditional funding programmes and “co-ordination”). The idea of keeping it alongside the much sexier content industries (Culture, Media and Sport), where it has become “contaminated” with their time-consuming, lawyer-driven feuds over ownership and censorship, has no friends among those who have commented to date.
To that end there is also a suggestion that the “Communications Act” that is in the offing be split between a bill to merge the telecommunications infrastructure responsibilities of Ofcom with those of Ofgem and of CPNI into a combined utilities regulator, (as in Germany) and a much more complex and controversial set of bills to handle the content issues on which their is little or prospect of agreement between the warring factions.
But if such changes are to help expedite infrastructure construction on the scale needed to help regenerate the UK economy, they need to accompanied by a stripping away of the layers of financial services legislation that discourage long-term, private sector investment in the UK. We have to permit a recreation of the variety of investment vehicles that funded the construction of the Victorian and Edwardian infrastructures on which we still depend.
Hence the policy studies framework that the executive of the Conservative Technology Forum will be reviewing in a couple of weeks time. I would, however, be remiss if I concluded this blog entry without including the Civil Service Staff College Case Study sent to me by a very senior former public servant. I fear that it neatly summarises the dilemma currently faced by DCMS officials. Hence the need for new thinking.
Extract from the training manual of the Civil ServiceStaff College
Observers of the machinery of government are excused if theymarvel at the way the thing lurches along, grinding and bumping through theruts and over the cobbles, never stopping but seldom actually getting to whereit’s supposed to be going. What follows is a true story (well – up to apoint). Imagine this:
You are Head of Broadband Stuff at the Ministry ofEntertainment, sitting in your office one day, idly wondering whether to spendthe weekend with Fiona Bruce or with the Duke of Cambridge’s mother-in-law,when the door slams open and in strolls The Boss (en route to lunch at theSavoy). “Here’s 10p” he says. “Everyone is to have 100 Megs byThursday”.
“Right Boss”, you say. “I’m on the case”.
You ponder for a bit and then you call Malcolm Corbett,because you’ve heard he’s something to do with broadband. “Malcolm”, yousay, silkily. “I’ve got 10p for you and I want you to fix us up withbroadband stuff. 100 Megs for everybody by Thursday. Can do?”
“Well,” says Malcolm. “I’d like to, but the troubleis, I’ve got all these tiny projects and 10p won’t go very far. I reallyneed a quid.”
At that you blanche (because you suspect The Boss is spentup on film studios and museums and broadcasting “Strictly” and throwing thejavelin in 2012 and other vital stuff). So you promise to let Malcolmknow and ring off. More pondering and then one of your team lifts hishead from the Guardian crossword and suggests that you might get someadvice from BT. “Good thinking,” you say and call Ian Livingstone. “Ian”, you begin. “I’ve got 10p and if you promise to give everyone 100Megs by Thursday, it’s yours!”
Ian pauses for a couple of seconds before he replies. “Well,” he says, thoughtfully. “I admit I’ve got a bit of a problem withmy pension fund and Openreach is certainly in need of some support. So -yes – send it over and I promise to accelerate our existing hyper-speedprogramme that has been covering 125% of the country since 1991, even thoughthere is no demand and the technology isn’t ready and which makes UK the bestcountry in the whole world for everything thanks to BT.”
“Great,” you reply, and hang up. “Chaps;” you say,interrupting your team’s focus on the latest syllabus for Theatrical Studiesand Asian Dance in All Schools. “I’ve just done a deal with BT andthey’ll give everybody 100 Megs by Thursday, so long as I give them our 10p.”
One of the guys looks up from his papers. “Isn’t thata bit dodgy?” he asks. “Won’t The Boss be a bit nervous about lack ofcompetition and Brussels and all that stuff? And won’t the small playersget upset at being left out?”
But another of the guys also looks up. “How aboutdivvying up the 10p among County Councils and letting them take the flak? Only a few of them know what they’re doing and so you can give them a bit ofguidance, nudge-nudge. They’ll run some sort of competition but end upgiving their share to BT anyway. Takes the heat off you, let’s them feelthey’re in charge – doing Big Society stuff – and you can tell The Boss thatthe job’s done so far as you’re concerned and that Dave will be happy.”
“Sounds good,” you say. “But hang on, what if there’ssome more money from somewhere else in government?”
At this, everyone looks confused. Even a bitshocked. “But that’s nothing to do with us,” somebody says. “That’stheir business. DEFRA and BIS and things. You’ll be talking aboutjoined-up government next!”
“True” I murmur, settling down to think about Fiona Bruceagain.
But not for long. There’s a tap on the door and inmarches Neelie Kroes and Malcolm Corbett. You suspect that your day isonly just beginning.
You are to produce a comprehensive, funded, broadbandimplementation plan for the whole of the UK that is: future-proof; exceeds EUtargets; based on either infrastructure or service competition (or both);sustainable; attracts maximum private investment, and rewards innovation.
I should perhaps add that the individual who sent this to me has a great deal of time for Malcolm and his colleagues in INCA – who he regards as a seriously under-used asset and far better value than most such bodies. He also has great sympathy for officials stuck trying to defend policies that are no longer valid, if they ever were. He just likes to let off steam occasionally – while trying to be publicly constructive. Hence my failure to attribute him, unless he wishes to come forward himself,