The BSG today submitted a report to the Welsh Affairs Select Committee as part of their inquiry in to digital inclusion in Wales.
Focusing on broadband availability and take-up, including the prospects for next generation broadband, the report highlights the challenges facing Wales, owing to the low population density and high proportion of rural communities.
Timely investment in next generation broadband will provide platform for innovation and productivity growth
The BSG welcomes the recognition given to the importance to the UK’s communications infrastructure in today’s budget and the confirmation of the government’s intention to make basic broadband services universally available across the UK.
However, the BSG is concerned that the budget announcements on next generation broadband do not yet provide grounds for confidence that such services will be made available beyond urban areas. The full benefits of next generation broadband will only be achieved through a combination of widespread availability and adoption.
Delivering the Universal Service Commitment
Next generation broadband
“The key is to find the intervention sweet spot, just enough but not too much???, said Antony Walker, Chief Executive of the Broadband Stakeholder Group.
“The aim should be to provide a sufficient nudge to the market that enables it to deploy more quickly and more extensively that it would do otherwise. The announcement on capital allowances may help to bring forward investment but does not address the challenge of extending availability beyond urban areas.???
Although difficult to quantify, there is a growing body of evidence [see notes below] to suggest that the long-term benefit to the UK economy of a measured and carefully targeted intervention could potentially significantly exceed the cost to government.
Today’s budget announcement comes almost exactly two years after the BSG first highlighted the need for action in its Pipe Dreams report on next generation broadband. The rapid deterioration of the UK economy means that the potential for market investment in low density areas has become further constrained.
Without additional action next generation broadband will be rolled out more slowly and less extensively, meaning that many rural areas will be left behind and the net economic benefit to the economy will be smaller and slower to emerge.
Explaining the significance of next generation broadband, Antony Walker said “This is really about the future potential for innovation and productivity growth right across the UK economy. Broadband is what economists call a general purpose technology that is relevant to almost every aspect of economic activity. It provides the potential for households, businesses and governments to do things differently, more effectively and more efficiently. And for some key parts of the economy, such as the creative industries, it will be the platform for transformative change that will open up a global market for entirely new products, services and applications.???
However, these benefits do not accrue automatically. The government will need to put as much effort into ensuring the rapid adoption and exploitation of these networks as it puts into ensuring their availability in the first place.
The BSG’s response to the BBC Trust consultation on the BBC’s Project Canvas proposals sets out the potential and significant impact this proposal could have across the broadband value chain.
Depending on how the proposal is taken forward in practice, it could have various implications, such as heightened pressure on broadband networks from increased levels of video traffic, to how Canvas could drive demand for higher quality broadband services and how such a UK centric development could affect global manufacturers of set-top boxes.
Central to the BSG response is the view that the BBC Trust needs to view the Canvas proposal in the wider context of an industry making the gradual and difficult transition to next generation broadband.
Furthermore, it is essential that this consultation is the beginning of the debate rather than a one-off and final assessment of the proposal.
Detailed, open and ongoing discussion across the value chain is vital to effectively assess a proposal that has such far-ranging relevance for the UK broadband value chain.
In an extraordinary announcement this morning, the Australian government have announced that they will spend up to A$43bn ($31bn, £21bn) on a new National Broadband Network, providing FTTH to 90% of Australian premises. The final 10% will be served using wireless technologies, capable of 12Mbps.
This scheme replaces the original FTTN project that the government had been developing since coming to power in late 2007. This plan, which had seen a number of bids submitted by industry, has been terminated. This was said to be partly due to the pressures brought by the global economic downturn on the value for money that Australian tax payers could achieve.
The Australian government will create a new company to carry out this project, in which it will be the majority shareholder. Private investment is anticipated. The new company will provide wholesale access (no retail services), and will be operated on a commercial basis. The government intends to sell down its stake in the company once the network has been constructed and operational for five years.
It is expected that the network will take 8 years to build and create 25,000 jobs. Some quick calculations suggest that the cost will be c£2,700 for each of Australia’s 7.8m households, although without more detail it is difficult to provide accurate costs per home passed or home connected.
Our cost modelling report suggested that providing point-to-point FTTH to 90% of UK households would cost about £21bn – about the same cost of the Australian proposal, but covering 22.5m homes, rather than Australia’s 7.7m.
This difference could be explained through the quite different geography and population density in Australia, and the fact that the network would presumably be an overlay to the existing network that didn’t make use of existing assets. However, the cost still appears on the high side.
The announcement has been welcomed by both the incumbent Telstra and its competitors. However, there are sure to be many challenging debates that will need to be held. The telecoms landscape in Australia is likely to change significantly as a result of this project and the regulatory reforms announced alongside the FTTH investment.
As before with the FTTN proposal, this is only the beginning of a process that has many hurdles to clear yet.
Peter Shearman, Policy Manager, BSG
The BSG today published the ‘Good Practice Principles on Audiovisual Content Information – One Year on’.
Last year the BSG facilitated the creation and publication of the Audiovisual Content Information Good Practice Principles. The principles committed signatories to providing clear, consistent information about audiovisual content, in order to ensure that consumers are able to make informed choices about commercially provided content.
This paper has been published one year following the launch, to give an update on how the principles have worked in practice. This includes how the signatories are working to meet the principles, and also includes information from three new signatories to the principles: BSkyB, MySpace and Tiscali.
Good Practice Principles on Audiovisual Content Information – One Year On
The BSG today finalised its submission to the government’s interim Digital Britain Report.
The response recognises the ambition and rationale of the report, while noting the challenging timescales. It goes on to highlight a number of challenges and issues facing developments in each of the areas of the report, and makes a number of suggestions as to how to address the actions raised.
Somewhat behind original timelines, the government has today given further indication of how it will proceed with implementing the Audiovisual Media Services Directive into UK law.
Today has seen the publication of a press release, Ministerial Statement from Andy Burnham, and a document giving an overview of responses to the original consultation.
An initial glance (so forgive me if a more detailed read thows up further information) shows that whilst the main thrust of the government approach is made clear, there is still a long way to go on the detail.
Today’s documents state that the government wishes to apply the Directive only to those “mass media services whose principal purpose is to provide television programming to the public on demand.”
The scope of services that will be captured by the Directive has been one of ongoing concern and where clarity is urgently required – as stated strongly in the BSG’s response to the AVMS consultation.
As ever the devil will be in the detail. Watch this space for details of the Statutory Instruments that will carry this into UK law….
What is clear however is that the Culture Secretary has not shifted from his initial view on product placement (something that the Directive allows Member States to permit, should they wish).
The title of the press release perhaps gives it away: “preserving standards will be cornerstone of UK media services”.
This release then goes on to say that “mindful of the need to maintain public trust in television broadcasters and British television’s reputation for high standards” that the government has decided to go with the status quo and continue to prohibit product placement.
What is interesting however, is that the release also clarifies that product placement will continue to be allowed in films and overseas programmes (which we knew) but also in programmes made by and for UK Video on Demand (VoD) services.
And VoD services are described as “TV-like” in the Directive……..
Now, these are just questions rather than a statement of view at this point:, but:
– Is the government response to a policy development that is trying to regulate for a converged media world, actually then drawing distinctions between how broadcast and on-demand TV should operate and be funded?
– Will that become an irrelevance to the consumer as people become used to accessing TV-like content on the mix between their mobile phone, TV and computer and also a mix between real-time and on-demand?
Such questions aside, the line drawn in the sand here will come as a blow for ITV and others that have been pushing the case for product placement with the government.
It also prompts one to consider how this decision will impact on the development of the Digital Britain report, which gives considerable emphasis to possible measures to address the challenges for digital content.
Today’s announcement does say that the government will review its position in 2011/2 on the back of further research by Ofcom on product placement.
As other Members States take advantage of the opportunity to implement product placement however, the question is, will this timescale be too late?
Pamela Learmonth, Policy Manager, BSG
Last Thursday the BSG held a seminar with SamKnows, who were the technical partner on Ofcom’s Broadband Speeds 2008 report.
The seminar produced an interesting debate, with discussions ranging from issues of methodology and technical concerns, to the policy implications of the results generated in the report (James Enck at EuroTelcoblog has given his views on the evening).
One area that was of particular interest was the scatter graph (reproduced in the event handout) plotting line length versus average throughput speed. Although using straight line length (the straight line distance from a home to the exchange) rather than the actual line length, the level of variance in performance between lines of comparable length is pronounced.
We have commented before on this blog how difficult broadband is as a service to market, given the fact that the customer experience is to an extent out of the hands of the service provider.
Getting behind the reasons for this variance should be a central concern of policymakers and the industry alike. The causes of the variance could have important implications for the development of public and regulatory policymaking in this area. We wait to see what Ofcom’s second report on broadband speeds is able to say on this.
Peter Shearman, Policy Manager, BSG
The BSG yesterday held a seminar with Sam Crawford and Alex Salter of SamKnows, who provided the technical team behind Ofcom’s UK Broadband Speeds 2008 report.
The event brought together over 40 industry representatives, and produced a lively and informed debate.
Leonard Waverman, of the London Business School, recently published the Connectivity Scorecard 2009, a follow-up to a 2008 scorecard he produced.
The scorecard is one of the more comprehensive efforts to benchmark performance, given its global nature and its composite metrics that provide a more useful view of connectivity within a country. Interestingly, the US comes out on top, followed by the Scandinavian countries, the Netherlands, and, also interestingly, the UK.
The UK is able to rank highly because the index is based on usage and skills as well as infrastructure, with different scores and weighting for government, consumers and business. So, while we are behind in terms of consumer infrastructure development, we are ahead on usage, particularly by businesses.
We do, however, score fairly lowly on government infrastructure and usage, which will be of concern given Digital Britain’s focus on moving government services online, enabled by a broadband universal service commitment. A country report is available on the scorecard’s website.
The scorecard provides a more useful and holistic view of a country’s performance than other examples such as the OECD league tables, which are often based on one or two specific measures and normally based on infrastructure comparison, rather than usage and skills. However, as always with such an index, data quality can be an issue, and the range of sources available for measuring each country against a specific metric will be limited and vary in reliability.
In Pipe Dreams we called for international benchmarking of the UK’s broadband performance; the need for this was re-iterated by the Caio Review. This scorecard isn’t perfect, but is one of the best efforts out there. The approach should certainly be of interest to public and regulatory policymakers as the UK’s NGA debate continues.
Peter Shearman, Policy Manager, BSG
The Government’s Digital Britain report rightly devotes a chapter to how you can “equip everyone to benefit??? from the digital future.
Whilst much of the commentary around the report has focused on infrastructure, broadband speeds and protection of copyright online, the important issue of how to drive take-up has been somewhat overlooked.
Such an oversight would be dangerous.
Without widespread take-up of broadband and the services which run over it, growth scenarios for the sector and the economy more widely will suffer.
Without tackling the various and often complicated reasons for people choosing not to get “online???, there is also the risk that a significant section of the population miss out on the opportunities that the digital future offers them.
Not a outcome that anyone would seek.
The Digital Britain report recognises that one of the reasons that people choose not to engage with digital technology is a lack of confidence.
The BSG agrees with this and believes that it is vital to resolve any consumer concerns and misgivings about how digital services work and their implications.
It may seem a self-evident point to make, but the provision of clear information about the nature of services can certainly go a long way to achieve this outcome.
This is the approach taken by the Good Practice Principles on Audiovisual Content Information, which were facilitated by the BSG. The Principles commit leading content players to give clear and easy to use information about commercial content that may be unsuitable to children and young people or cause more general offence, so that individuals can make informed choices about the content they want to access – whether online, on a mobile phone or through an on-demand TV service.
This week, leading social network providers across Europe committed to a set of principles to enhance the safety of children and young people using their services. These are to:
• Raise awareness of safety education messages and acceptable use policies
• Work towards ensuring that services are age-appropriate for the intended audience
• Empower users through tools and technology
• Provide easy-to-use mechanisms to report conduct or content that violates Terms of Service
• Respond to notifications of illegal content or conduct
• Enable and encourage users to employ a safe approach to personal information and privacy
• Assess the means for reviewing illegal or prohibited content/conduct
These principles embody existing practice of social network providers and further demonstrate the role that industry can play in giving the consumers the tools and confidence they need to engage with digital services in a safe and confident way.
As the final findings of Stephen Carter’s Digital Britain report are crafted, we hope it will conclude that in order to empower the digital citizen of the future, knowledge and confidence is key.
Pamela Learmonth, Policy Manager, BSG
Last Monday saw snow bring the majority of England to a standstill, and disrupted many businesses. But the ability to work from home remotely meant that the disruption for some was less than it otherwise might have been.
ISP PlusNet have produced data showing that the amount of VPN and other associated traffic on their network on Monday was double what it usually is, reflecting the amount of remote working taking place. While the FSB estimated that UK business lost up to £1bn in lost productivity, BT estimate that small businesses recovered £333m of that through flexible working arrangements.
Our work last year on the value of next generation broadband suggested that additional remote working opportunities would bring a variety of benefits to the economy and society – social benefits through better work-life balance and less need for travel; economic benefits in terms of increased productivity. We also included the benefits of remote working in disaster situations, such as flu pandemics.
However, we didn’t factor in snow. We might have to go back and revise our estimates if the cold snap continues.
Peter Shearman, Policy Manager, BSG
The government’s Digital Britain Interim Report has been launched. The press release is available here, and the report itself is available here. The BSG press release responding to the launch is available here.
We have produced an initial analysis of the report in a special edition of our newsletter. We are keen to hear the views and opinions of members of the BSG community, and anyone else with an interest in the broadband value chain, on the issues raised in the report.
If you have any views you wish to share please either comment on this blog or send us an email. We will pass on all views to the government’s Digital Britain team.
While we wait for the publication of the government’s interim Digital Britain Report, the annual ECTA (European Competitive Telecommunications Association) Regulatory Scorecard was released yesterday, and as last year Ofcom scored the highest of all European NRAs.
Ofcom generally scored strongly in most areas. However, for economic market conditions for broadband, Ofcom ranked as ‘neutral’, rather than ‘strong’. Only Portugal and France achieved a strong rating.
The scores are based on responses to surveys that review: the overall institutional environment; key enablers for market entry and network roll out; the NRA’s regulatory processes; application of regulation by the NRA; and regulatory and market outcomes.
The BSG welcomed the publication today of the Digital Britain interim report.
Kip Meek, Chairman of the BSG said, “the Prime Minister made it very clear today that digital networks will be the driving force of the economy going forward. Next generation broadband is the biggest economic prize at stake in this report.
The government has set out the key issues and is stepping up to the task of setting a clear strategic framework that encourages the sector to invest – and the country as a whole to benefit.???
The report recognises the central importance of broadband to the UK economy and sets out three key challenges: firstly, to agree a minimum level of service that should be universally available; secondly to further drive the levels of take up; and thirdly to ensure the timely and widespread deployment of next generation broadband networks.
The BSG also welcomes the emphasis placed in the report on ensuring that consumers are empowered to navigate the digital future effectively. The BSG believes that a coordinated approach is required to ensure that consumers have trust and confidence in digital services and are comfortable with the rapid innovation taking place across the sector.
Proposed measures to improve levels of media literacy, and empower consumers to make informed choices through the provision of transparent information about the nature of content and the use of personal data are positive steps to achieve this important outcome.
The BSG has produced a special edition newsletter providing further comment and analysis on the contents of the report – available to download below. We are keen to hear the views of members of the BSG community on the ideas discussed in the report.
Digital Britain Interim Report
