Next generation broadband
42. Universal availability of today’s network is a necessary, but not sufficient step in delivering the sort of digital infrastructure we want for the UK. We also need to see tomorrow’s network available widely across the country in the coming years.
43. Like the UK, Governments around the world are grappling with what should be the right strategy for developing the next generation of broadband for all their citizens and businesses. Many countries view Next Generation Access Networks as important to international competitiveness. There are genuine negative consequences for a country still connected to the Internet at 14.4 Kbps today. In twenty years’ time, countries still connected to the Internet at 3.3Mbps (or the 256 Kbps that characterises the up-link speeds for many consumers today) will similarly be left behind.
44. The new applications, services and businesses that such networks make possible will be likely to develop fastest in those countries earliest to adopt fibre. While we cannot predict with accuracy the full effects of a new network, we can note the productivity gains from first generation broadband. It is not fanciful to imagine further gains from next generation broadband.
45. Within the past twelve months, the arguments for next generation development have been bolstered by the worsening economic situation, given broadband projects’ potential role in creating a short term stimulus as well as strategic infrastructure. However, there are constraining factors on the desirability of widescale intervention to deliver next generation broadband. Governments need to be careful not to chill or displace private investment.
46. Taking these factors into account, we have examined the likelihood of market-led investment throughout the country in this critical national infrastructure. We welcome the substantial investment already taking place, and are confident that the UK’s competitive markets will provide the stimulus for further investment without any Government intervention, providing competitive coverage of superfast, next generation broadband for between half and two-thirds of the population.
47. Other developed economies are recognising the importance of investment in next generation broadband and, as we set out below, are pursuing different strategies to achieve this. In the UK we will achieve wide-scale next generation coverage first through market-led investment and, to a smaller degree, through targeted intervention.
