Broadband network to form backbone of UK economy

NEW DELHI, INDIA: The UK’s first communications minister, Lord Stephen Carter, has today published the much anticipated report: Digital Britain. It portrays the sector as a ray of hope in an otherwise bleak economy and proposes 22 recommendations to make the digital network the backbone of our economy in the same way that roads and railways have been in the past. All well intended, but severely lacking in the detail.

More thinking needed before the final report in the summer

Yesterday we learnt that Britain is set to suffer worst recession of any advanced nation, as such any measures designed to stimulate sectors of the economy must be timely and credible. It means taking the right long term decisions now to secure a competitive future. Governments face a choice now to move away from a reliance on the financial sector and make the broadband network the backbone of our economy in the same way that roads and railways have been in the past. Governments and policy makers can do this through creating and fostering a dependency on the services that these networks can provide.

In this respect the UK is already behind other countries both in Europe and the rest of the world. Elsewhere governments have launched national broadband tenders and committed to the direct financing of fibre roll outs. Digital Britain (perhaps unfairly) is seen as the UK’s answer to an Obama stimulus package but on seeing the interim report the UK is at risk of substituting action for yet more reports. No fewer than eight new reports will come out of Lord Carter’s initiative with responsibility spanning across three institutions – DCMS, BERR and Ofcom. The government must ensure that Digital Britain doesn’t become merely a series of reviews, reports and consultations.

Ubiquitous broadband can be made possible by spectrum reform

Important key roadblocks have been acknowledged such as the delay to spectrum re-farming. Promisingly a new Wireless Spectrum Modernisation Programme seeks to address these delays and if a voluntary solution amongst operators does not emerge then a government imposed resolution could unfold.

This is a crucial action point that should be prioritised. Without these spectrum reforms the deployment of mobile broadband is unlikely to become a reality. This has far reaching implications for the ubiquity of broadband since it is hard to define a new universal service obligation until such spectrum issues are resolved. And these aren’t the only barriers to such reforms.

Opportunity to engage at a European level

Promising a universal service obligation for broadband by 2012 is an ambitious target with far reaching implications. Before making any such revisions, the UK must work with the European Commission to modify the current Universal Service Directive – an activity that is currently underway – but one that has been delayed for some time now. Given the progress to date it’s hard to see the situation in Europe changing before the final report due later this summer.

Author is senior analyst at advisory and consulting firm Ovum