CMA calls for new communications act

The next government should set up a single department to oversee telecommunications and broadband, according to the Communication Managers Association (CMA).

The next government should set up a single department to oversee telecommunications and broadband, according to the Communication Managers Association (CMA).

A future government should introduce a new communications act to encourage supply competition and commit itself to delivering universal access to affordable, high-speed, symmetrical broadband before 2017, it said.

CMA chairman Carolyn Kimber described the government and the opposition's plans for high-speed broadband as "a vivid illustration of the poverty of thought and action that is serving UK businesses so badly".

"[Investment of] £150m-200m a year on rolling out broadband to unserved areas is not going to create the flourishing online economy that is the economic future of the UK," she said.

Kimber was responding to BT's quote of £45,000 to upgrade the dial-up internet connection of a bed and breakfast business to broadband.

The CMA said it understood the political parties' respective strategies on universal broadband, but did not believe they would achieve it quickly or comprehensively enough to capitalise on the growth potential of the online economy.

Kimber called on local authorities and businesses to invest in online services and social infrastructure to take advantage of universal access to broadband: "This could be achieved by favouring business plans that specify web-based services. Such plans would be supported through positive action by both regulator and government, and would allow return on investment to be tracked."

Many councils are already doing this, and the government's plans to set up a "G-cloud" to serve government departments are a further step.

"Success stories are not currently the norm, and CMA believes that it is necessary to stimulate the environment a long time before 2017. The current drip-drip approach is not working. As soon as we build the road, the business will surely come," Kimber said.

She added that government proposals for a landline tax, or diversion of part of the BBC licence fee, would provide a return on investment only for a limited number of very specific projects: "A more adventurous and innovative approach is needed if the relatively small sums generated by either proposal are to be spent effectively."

Kimber called on the new government to create "real, effective and sustainable competition in the supply of telecommunications goods and services, plus appropriate revisions to the present, or creation of a new communications act".

She called for a single department to develop national communications policy to maximise benefits from the convergence of broadcasting, phone and internet technology, and to represent UK business consumers in international forums.

"The UK lags far behind leading countries such as Korea, Japan and Sweden in terms of broadband provision. Indeed, the UK only just makes it into the top 30 in terms of BQS [Broadband Quality Score]," Kimber said.

UK broadband services, such as IPTV (Internet Protocol television) are already stretching today's "less than adequate" infrastructure. The UK is falling behind its economic competitors.

She said 12.6% of UK businesses have a website and online trades are 9.8% of the value of all sales of UK non-financial sectors and showed 36.6% year-on-year growth.

Ofcom's working plan for 2010-11, which addresses competition and investment in superfast broadband, is a start, but lacks the clarity, urgency and stimulus that a national policy could provide, she said.

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