Précis The House of Lords' Communications Committee argues that the Government's focus on broadband speed does not show sufficient long-term strategic thinking and so risks worsening the digital divide.
What? In 2010, the Government published their vision for the future of broadband in the UK, in which they set the specific target of providing superfast broadband, defined as 24Mbps, to at least 90% of premises in the UK by 2015, and to provide universal access to standard broadband with a speed of at least 2Mbps by 2015. However, the House of Lords' Communications Committee has published a critical report on the Government's broadband policy. The Committee believes that, although the prioritisation of broadband is to be welcomed, it is unwise to focus on broadband speeds as a measure of success. The Committee's report sets out an alternative vision for the development of a future-proof broadband network, which focuses on removing the digital divide by promoting access for all.
So What? The Committee argues that broadband is becoming a "domestic essential, similar in many ways to other key utilities like water or electricity". It is a major strategic asset, which can have positive social and economic benefits for all UK citizens, and the broadband network therefore requires the same kind of long-term strategic planning that is given to the rail or the road networks. However, the Committee believes that the Government has glossed over proper strategic planning and points of first principle in order to focus on "sloganeering" promises about target broadband speeds. They comment that "the starting point for their policy... arises from thinking about broadband primarily as a commercial service proposition, and one in which the general availability of speed is the crucial factor".
Given the importance of high-quality data connections to the country, the Committee believes that the Government is wrong to focus on speeds, and should instead prioritise the process of ending the "digital divide" and making sure that access to broadband is both universal and able to cope with advancing demand. According to the report, the Government has not sufficiently considered the importance of universal rollout, and "the focus of the current policy on ensuring specific speeds in end-to-end networks is...likely to support investment in technologies which will certainly help carry faster speeds to a proportion of UK citizens by 2015, but which will not do so universally".
A key criticism of the current strategy is that it is not "future-proof". At first glance it does appear that the Committee's criticisms of the Government's current strategy are unwarranted - ultimately, it aims at rolling out universal broadband in the UK, and thereby ending the digital divide, which is what the Committee supports. The major bone of contention is that the Committee feel the current policy is short-sighted and will not allow for the potential use of, and demand for, broadband in the future to go unhindered. Developing a broadband network that, in time, becomes redundant and requires replacement will result in a lack of universal, adequate broadband in the future.
The Committee therefore proposes an alternative vision of a future-proof broadband network, advocating that a national broadband policy should ultimately aim to have point-to-point FTTP installed throughout the UK. This use of fibre optic cables would more than allow for advancing demand for broadband services in the future. The Committee is adamant that any broadband policy should be devised firmly in view of the future, with a minimum ten year horizon - current estimates expect bandwidth demand to increase roughly 8-fold every five years, and a series of shorter term strategies will lead to disjointed progress, wasted funds, and a hindrance of progress towards the ultimate goal.
However, the cost of point-to-point FTTP is currently prohibitively expensive. In 2008, the Broadband Stakeholder Group estimated that national deployment of FTTC would cost £5.1 billion, while taking fibre to every UK home (FTTP) could cost as much as £28.8 billion. Given the limits on resources, the Committee recommend that
Government policy should, as an intermediate step, aim to bring national fibre-optical connectivity - which would include as a minimum, fully open access fibre backhaul - within the reach of every community. This will provide the platform from which basic levels of service can be provided to all, and an improved service where there is sufficient demand.
Essentially, then, the Committee is advocating that policy should be focused on building a high-specification infrastructure that does not necessarily go all the way to people's doors, but is within their reach. The people can then connect to that in any way that they choose. In this, the Committee are proposing fully open access fibre backhaul, with "hubs" in each community and local demand and competitive pressures putting the apparatus in place from these fibre-optic "hubs" to the premises. This contrasts with the Government's focus on an end to end solution, despite their original intention of adopting a "village pump" approach to the expansion of broadband coverage.
The Committee accepts that its alternative strategy would be challenging to put in place as the wheels are already in motion for the current strategy. There is some recognition that, while there has been a failure to attract any serious competition in regional infrastructure investment from anyone other than Openreach using the Government regional broadband funding, those plans are already underway.
Although the Committee stands by its alternative strategy, it has also recommended a number of "tweaks" to be made to the current Government strategy immediately in order to bring about an end result closer to their own vision, including the following:
the Government should undertake an urgent review of the way in which public funds are being used in relation to the roll out of broadband - the Committee highlight in particular the Rural Community Broadband Fund, and a case study showing that, perversely, the people with the worst access to broadband are being denied funding from this body;
- all new buildings should be ducted for fibre. This would have roughly the same cost as fitting them with copper, but would assist with the roll out of fibre optic cable;
- the Law Commission should consider the impact on the Electronic Communications Code on the roll out and availability of broadband infrastructure throughout the UK;
- the Government should consider the costing implications of the Committee's recommendations, not least because the Committee has proposed removing the final mile from the element that requires public subsidy;
- the Government should recognise as a general principle that it is vital to monitor the dominant, national providers to ensure that they behave in the public interest; and
- the Government's targets should refer to minimum and median levels of service (as opposed to 'average' levels of service which hide the real digital divide).
These are only a few of the far-reaching recommendations made by the Committee with respect to next generation network roll out. Whilst in the shorter term the Government may find it difficult to overhaul its current plans and objectives for next generation broadband roll out, the Committee's report could have a longer term effect in changing the policies of Ofcom towards infrastructure competition in telecommunications markets in the UK.
Industry stakeholders will also be monitoring closely whether or not the Government and Ofcom follow through on some of the Committee's other recommendations. If some of the recommendations are followed through to their logical conclusion, the UK could see even see developments as ground breaking as the transfer of terrestrial broadcast content from spectrum to the internet and the opening up of BT's ducts and poles to competitors in a much broader range of markets.
You can see the full report here.