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The government

BSG Chairman Kip Meek and CEO Antony Walker both spoke at the recent Oxford Media Convention, held at the Said Business School, Oxford University.

On a panel discussing ‘Public value: Broadening the debate’, Kip was joined by fellow panellists Helen Milner of UK Online Centres, Stewart Purvis of Ofcom, and Chris Woolard of the BBC Trust. Damian Tambini, of the London School of Economics, chaired the panel.

Fellow panellists Andrew Heaney of the Carphone Warehouse, and Bill Thompson of Digital Planet joined Antony in a discussion around ‘Who pays? Funding the next generation network’. The session was chaired by Emily Bell of the Guardian.

Following an EU procurement process, Thales, along with bid partners Alcatel Lucent and Kingston Communication, have been chosen as the preferred bidder to deliver the Digital Region project, which will provide a next generation access network to approximately 600,000 homes across South Yorkshire.

Four local authorities in the South Yorkshire area have put the Digital Region project together. The key aim is to create an infrastructure for the region that will spur economic regeneration, offering high bandwidth broadband that will encourage knowledge-based business to the region and provide the opportunity for business located in the region to offer new services and enter new markets. The project, it is hoped, will also partially address the digital divide in the region: only around 20% of households have taken up a broadband service.

Industry, government and regional development agencies are watching this project with interest. Current debate around if, how and when the public sector should intervene in the investment in next generation access technologies has yet to provide a clear consensus amongst stakeholders. The outcome of this project will go some way to clarifying this debate, and providing experience to inform models for possible further public sector interventions elsewhere in the UK.

Australia

The BSG has launched its own blog.

Based on the trade website IT Pro, the blog will comment on the latest news, key strategic developments in the broadband industry, and current work within the BSG.

The blog will aim to be a useful contributor to the increasing public and industry debate around the future of broadband in the UK.

BSG IT Pro blog

The BSG has submitted its response to Ofcom’s consultation ‘Future broadband: Policy approach to next generation access’.

Our response notes that the regulatory environment is just one element of the debate that needs to be resolved to enable the UK to move towards NGA, but welcomes the consultation as a step forward in creating the right conditions for timely and efficient investment in NGA. Among the key points in the report are as follows.

• There is a need for greater regulatory certainty in order for investment decisions regarding NGA to be made.
• How Ofcom’s regulatory principles will be applied in practice needs to be explored, and scenarios for NGA deployment should be examined in this context.
• Further work is needed to identify at which level competition in an NGA world will be efficient, sustainable and valuable.
• On past experience it is reasonable to assume that market led deployment is likely to fall short of universal or near universal deployment. The BSG is working with stakeholders to identify models for efficient public sector intervention in cases of market failure.

BSG response to Ofcom NGA consultation

The Broadband Stakeholder Group has appointed Plum Consulting to undertake research into the economic and social value of next generation broadband to the UK

This research has been commissioned in response to Recommendation 1 in the BSG’s ‘Pipe Dreams?’ report, which highlighted the need to define the framework for measuring the economic and social value of next generation broadband in order to create an evidence base that can support policy making.

Plum, together with the BSG, will develop a conceptual framework for understanding the potential economic and social value that could accrue from the widespread availability and take-up of next generation broadband services, and the social and economic shortfall that might result from late deployment or incomplete coverage or adoption. The work is being supported by BERR and the Ofcom Consumer Panel.

The final report will be published in the Spring of 2008.

Australia’s experience in its current General Election has shown that broadband matters to citizens, and that international league tables matter to governments.

Speaking at a Westminster eForum event on ‘Delivering Next Generation Broadband’, Antony Walker highlighted key lessons for the UK from the current Australian experience.

The fact that, according to The Australian, “for many voters… broadband could be the election issue that decides who gets their vote??? shows how broadband has become an integral part of individuals’ lives, and inferior access is a real concern for them.

The experience also demonstrated the importance of international comparisons, as much of the debate in Australia was driven by Australia’s low ranking in OECD league tables. This was reflected in Recommendation 3 in the BSG’s ‘Pipe Dreams?’ report, which proposed government targets to ensure the UK remains in the upper quartile of OECD nations in terms of broadband reach and quality.

Antony Walker, ‘The growth of broadband in Britain’ – full speech

The Broadband Stakeholder Group described the publication today of Ofcom’s consultation on the future of broadband as a key milestone in a debate that will shape the UK’s communications infrastructure for decades to come. “This consultation will be as important for the future of broadcasters and new media companies as it is for BT and other communications providers,??? said Antony Walker, Chief Executive of the BSG.

The BSG is pleased that Ofcom agrees with its view that the potential impact of these new networks on the UK economy could be very significant. In general Ofcom’s consultation document supports the analysis of the BSG in its Pipe Dreams report published in April this year. Key comments the BSG would like to make regarding the consultation launched today include:

• We agree that the commercial, geographical and political drivers that are leading to early investment in next generation access in other countries are absent in this country. Consequently, next generation broadband deployment in the UK is likely to lag behind other countries.
• Ofcom’s current focus should be on creating regulatory certainty that will enable efficient and timely investment in next generation broadband access.
• Competition has been critical to the success of first generation broadband services. We agree that that the future regulatory framework should continue to be based on the principle of equivalence – this has been proven to work well in the UK and has helped create a vibrant and flourishing first generation broadband market.  We do not believe that regulatory forbearance (the approach being taken in Germany to incentivise NGA deployment) would be appropriate in the UK.
• However, there may be a need in the future for Ofcom to take more interventionist measures if evidence emerges that the UK economy could suffer from delayed deployment of NGA.
• With this in mind, the BSG will work closely with government and Ofcom to understand the economic and social value of next generation broadband and to monitor developments in international markets.

The BSG will respond to the consultation and encourages all organisations involved in the knowledge economy to do so too.

BSG response to Ofcom NGA consultation – full press release

The BSG’s new work programme was launched at a reception on 18 September by Minister for Competitiveness Rt Hon Stephen Timms MP, who used the occasion to tell stakeholders that he sees it as one of his ‘highest personal priorities that we have a high performance telecommunications infrastructure in every part of the country, enabling us to compete successfully on a global basis.’

The Minister went on to say that he would chair a high level summit later this year to consider the circumstances that might trigger public sector intervention, the form that intervention might take and at what level it might sensibly take place. He also underlined the important role that the BSG has to play in bringing stakeholders together to ensure that the UK is in a leading position on broadband in the future.

Kip Meek, BSG Chairman, explained how the BSG’s work programme would rise to this challenge. He said that work would fall into four areas:

• Policy, which would look among other things at the potential social and economic value of next generation broadband
• Commerical, where BSG will faciliate debate about business models across the value chain to support investment in infrastructure
• Regulatory, allowing the BSG network to input into regulatory discussions at UK and EU level
• Public sector intervention, where BSG will investigate models for efficient public sector intervention

The Minister’s speech in full

Minister launches new BSG work programme – press release in full

Financial Times coverage

Slides and Papers
For next generation broadband to move from pipe dream to reality, the BSG has argued that steps need to be taken now. Business models need to align the interests of operators with upstream content providers and end-users and a new regulatory framework will be required to strike the right balance between incentivising efficient investment and ensuring sustainable competition. Focusing on three of the recommendations set out in the BSG’s Pipe Dreams report, the seminar:

• debated and explored alternative commercial models to support network investment
• discussed the regulatory challenges posed by next generation access, and
• reviewed options for access to alternative shared infrastructure in the UK.

Each session was kicked-off by a series of presentations that provided independent perspectives on the commercial and regulatory challenges at different parts of the value chain. The floor was then opened up to debate and discussion. This event marked the launch of the BSG’s new work programme designed to create the right conditions in the UK to enable efficient investment in next generation broadband services and ensure their timely and ubiquitous availability for the benefit of UK citizens, businesses and public sector.

To view the presentations and papers that were produced for the seminar, click on the links below:

Presentation from Jonathan Dann, Bear Stearns

‘From Pipe Dreams to Reality’ – paper by Matt Yardley, Analysys

Presentation by Matt Yardley, Analysys

Presentation by Martin Geddes, STL

Presentation by Dave Tansley, Deloitte

Presentation by Clive Carter, Ofcom

Presentation by Brian Williamson, Indepen

Presentation by Richard Cadman, SPC

Presentation by Colin Long, Olswang

From the foreword by Ed Richards, Chief Executive:

“This is Ofcom’s second annual review of telecoms, television and radio markets across the nations and regions of the UK. In it we aim to present the most comprehensive picture possible of trends in these markets, in order to establish the context for policy decisions by Ofcom and other types of decisions by other public and private sector organisations…. This year’s report shows that the gap between ‘leaders’ and ‘laggards’ on key indicators has narrowed over the period, with availability and take-up in rural areas closing on urban conurbations… Two enhancements have also been introduced this year. The first involves research on issues specific to individual nations that were identified or highlighted as requiring further investigation in the 2006 report… The second innovation is that the report provides an industry overview for each nation – highlighting, for example, the scale of investment made by the BBC and ITV1 in nations and regions television output and their hours of broadcast output…”

The Communications Market 2007 Nations and Regions

New directive could be finalised before the summer break as culture ministers agree on Commission’s compromise text…

Full European Commission press release

Bridging the Broadband Gap – Benefits of broadband for rural areas and less developed regions

Brussels, 14-15 May 2007

Attendance is by invitation only, but non-invitees can still get involved – see the website and ‘How do I get involved?’

See full conference information

Raising the bar.

A white paper from the Economist Intelligence Unit.

Strong government role in promotion and adoption of ICT propel Asian countries up global e-readiness rankings, according to the latest report from the Economist Intelligence Unit (EIU).

Written in co-operation with the IBM Institute for Business Value.

Download report and read further details