The overall tenor of the report might be described as modestly interventionist, with "industrial activism" and "modernisation" as recurring catch-phrases. However, there are few signs of grand projects and those we were expecting - universal broadband now (or soonish), next generation broadband later, re-jigging the funding of broadcasting - are all quite modest in scale and funded from bits and pieces here and there. Of course there is a sprinkling of Czars, including Martha Lane Fox of former Lastminute.com fame as Champion of Digital Inclusion, though the report stops short of crowning them as such. There are no Dragons or other professionally grumpy reality TV stars that we could find.
In relation to telecoms, we see the following main objectives spelled out in the report:
- Preventing exclusion - skills, affordability, motivation;
- Promoting access to current generation broadband (the broadband Universal Service Commitment);
- Ensuring that next generation broadband reaches otherwise uneconomic areas (Next Generation Final Third project).
Key proposals:
- Home Access scheme - content and skills development for children, young people and their families - currently in pilot in Suffolk and Oldham - £300m budget - plus industry initiatives from Microsoft, UK online (DfES), second-hand computer schemes etc.
- Digital Inclusion Programme - under the auspices of the Digital Inclusion Champion, backed by an Expert Task Force and in cahoots with the (already proposed) Digital Inclusion Consortium. It is not yet clear what they will do, other than "move toward" a National Plan for Digital Inclusion and, maybe, merge with various other bodies into a Digital Inclusion Agency at some later date.
Winners:
- The quangocracy, would-be Champions
- The "corporate responsibility" industry
- Digitally naive young people (if any)
- The poor (maybe)
- The digitally reluctant.
Key proposals:
- Revise universal service obligation (USO) legislation and license authorisations to extend them from narrowband to broadband
- Establish a "delivery body" (Network Design and Procurement Group) with powers and technical expertise to procure not-spot solutions on a technology-neutral basis - CEO to be appointed by the end of October 2009
- Twist the arms of the BBC Trust and BBC Executive to cough-up the money left over from under-spending on supporting elderly people and others as the switchover of TV broadcasting to digital proceeds
- Pass the hat around interested corporations, local authorities, regional development agencies and the like to get additional funding and contributions in kind
Winners:
- Not-spotters
- BT - will probably get most of what's going
- Mobile operators - might get some at the margins
- Virgin Media - might get some at the margins
- Local self-help initiatives (e.g. rural/village wi-fi/Wi-Max ventures) and similar
- The elderly and confused
- The TV-switchover-support industry
- The BBC - but they have known since at least the first PSB Review that the money would probably be ring-fenced
Key proposals:
- Impose a 50p/month tax (the Next Generation Fund) on every copper line (including coax) to fund extension of high-speed broadband (FTTx, or equivalent) to the "final third" of the country that would otherwise be uneconomic to serve. Operators will be responsible for collecting it and remiting it to Ofcom
- Allow operators to bid on a technology-neutral, reverse auction basis for tenders, which will be managed by the Network Design and Procurement Group (see above)
- Amend the Communications Act 2003 to make the promotion of investment in communications infrastructure one of Ofcom’s principal duties alongside the promotion of competition
- Crofters, farmers, second homers, rural retreaters, owners of moats and anyone else in the final third
- BT - will probably get most of what's going
- Mobile operators - might get some subsidy at the margins and may benefit from some increased defections from fixed lines
- Local self-help initiatives (e.g. rural/village wi-fi/Wi-Max ventures) and similar
- Probably not Virgin Media, as relatively few of the final third areas seem likely to be sufficiently adjacent to their existing footprint
- Anyone with a copper line (including, it would appear, a hybrid fibre/coax or fibre/twisted pair FTTC one)
Key proposals:
- Existing 3G licences will be made indefinite
- The Administrative Incentive Payments (AIP) structure (annual fees paid by spectum owners) will be adjusted to achieve greater fairness, though how is still to be determined
- The 800Mhz "digital dividend" from shutting down analogue TV, together with the 3G expansion band will be auctioned off in 10Mhz blocks
- Appointment of the Independent Spectrum Broker to manage the above (ISB - already in place - his report was published on 13th May 2009). It is proposed to implement his proposals.
In conclusion
On the face of it the report might be accused of a lack of ambition, particularly in setting the universal service criterion as low as 2 Mbps and with a relatively leisurely progress towards high-speed broadband. Perhaps understandably in current economic circumstances, it avoids extravagant spending commitments, or almost any spending commitments, to the extent that we wonder whether even its modest ambitions are realistic given the amounts proposed, for example the 50p/week/line tax in relation to the billions said to be required for next generation broadband. However, we'll return to that topic in a forthcoming post!
