One of the coalition government’s biggest pledges related to the provision offor everyone during the its five year term in office. It pledged that every home and business would have a guaranteed 100 percent access to fast and a 90 percent access to superfast services by 2015. However, a recent report by the London School of Economics would suggest otherwise. The report claims that a £1.1 billion funding gap will mean that even the government conservative targets are unlikely to be met. The report has also urged the government to do more to ensure that underinvestment does not harm the UK economy, adding that a rise in broadband penetration of 10 percent can lead to a 0.9 – 1.5 percent boost in GDP per capita.
The LSE report, which was sponsored by customer management software company Convergys, claims the total cost of meeting all the targets will be £2.4 billion, but funding for broadband from all public sources only amounts to a total of £1.3 billion, leaving an estimated shortfall of £1.1 billion. The government has suggested that private investors were prepared to meet this shortfall, but this seems unlikely in the current economic climate. The LSE defines “basic” broadband as services offering speeds of up to 2Mbps. “Fast” broadband ranges from 2Mbps to 24Mbps, and “superfast” exceeds 24Mbps. One of the report’s authors, Paolo Dini, is urging the government to do more, given the economic benefits broadband could bring:
“The government target of 100 percent coverage by basic broadband by 2015 is likely to be met, but it is less clear when the government targets of 90 percent coverage by superfast broadband, and 100 percent coverage by fast broadband, are likely to be met. In this year’s budget the government allocated £200 billion for transport infrastructure and £50 million to broadband. That doesn’t seem quite right.”
However, a spokesman for the Department for Culture, Media and Sport denied the targets were likely to be missed, claiming:
“We are confident of completing the roll-out by 2015. All local authorities except two met the government’s timeline by submitting their initial broadband plans on time,” he said.
“We have always been clear this investment will not meet the full cost but will help make it economically viable for telecoms companies to roll out broadband to areas that would otherwise be left behind.”
The UK comes 17th in a global ranking of broadband penetration, that is the number of broadband lines per 100 population, according to Point Topic, a broadband research company. It says the UK’s figure of 34.75 percent at the end of 2011 is behind neighbours including France, Belgium and The Netherlands, but just ahead of Germany, Canada and the US. However, the UK ranks 31st in terms of the penetration of fibre-based services; a technology used to provide “superfast” services.
Oliver Johnson, chief executive of Point Topic, told the BBC that the report’s figures matched his own estimates for broadband spending, and confirmed that the expected funding gap was unlikely to be filled by private enterprise, but he still insists the UK is still spending a significant amount on broadband compared with other European countries:
“The UK is in the top two or three in terms of central spend and commitment to achieve comprehensive coverage. We are actually not doing too badly, although the whole of the western hemisphere lags behind Asia in this regard.”