Until December 5th you still have time to tell Ofcom what you think about its ideas for regulating ‘Future Broadband’. 

The cost of  replacing local copper with fibre across the UK is likely to be massive – maybe even more than half the cost of 3G spectrum licences.  Like 3G, potential investors need to be sure about the rules.  It would be tragic if these failed to encourage a new and rich variety of competitive services and investment in the UK.  Ofcom’s consultation is, however, unlikely to get anyone excited about the prospect of radical change in the way we get connected or what we get connected to.

Ofcom asks five questions.  If you read their consultation carefully, all sorts of other questions might spring to mind but, if you still have time, take a look even if you only have a view on a few of the points.

Question 1.   When might it be a good time to replace copper distribution with fibre?  Actually Ofcom asks when it would be ‘timely and efficient’ to invest.  Can UK businesses can get by without the capacity and speed to use hosted applications services or symmetrical upload/download speeds?  Maybe we don’t need an easy choice of multiple service providers delivering concurrently on the same fibre?  Competition Minister Stephen Timms MP thinks we have only a narrow window for action before the UK falls hopelessly behind – but even then we’d need a massive effort to catch up with our continental competitors.   To be both timely and efficient the investment case will need much more of a value than a cost justification.

Question 2.  Ofcom asks if you agree to their plans for future regulation.  At stake is the future of the Universal Service Obligation.   Are we sleep-walking towards a UK where rural areas have triple-pay – higher line rentals (‘geographic pricing’ for access lines), lower broadband speeds and little or no competitive choice?   Should businesses need to relocate to get a half-decent service or should Ofcom’s consumer remit be better served by changing the Universal Service Obligation into a Universal Access Obligation? 

Question 3.  Here we are still debating the 1980’s notion of infrastructure competition.  The concept of open-access carrier-neutral networks has been demonstrated brilliantly elsewhere in Europe and Canada and has already been half-accepted in the functional separation of BT.  To see a return on fibre investment the infrastructure must maximise the number of operators using it and the range of competitive services it can handle.   Tease apart Access and Service and it suddenly becomes clear how you can have massive competition at the retail (Service) level and how new fibre distribution investors could live within a regulated wholesale model. 

Question 4.  Clinging to the idea that new fibre local networks should be ‘Passive’ and not ‘Active’ is like saying that railway tracks should be built without signalling systems so that train operators can each add their own versions.  Clinging to the notion that ownership of the local fibre need somehow restrict the choice and range of services running over it is failure of regulatory imagination.  Should anyone would be allowed to invest in fibre merely to maintain monopoly-minded business models and inhibit competition?  Passive may be 8% cheaper but it’s very difficult to unbundle.  Guess who prefers Passive to Active? 

And finally, Question 5.  Will we ever get fully fibred without some form of publicly-supported intervention?  Ofcom asks whether we support ‘artificial’ incentives?  With that word ‘artificial’ Ofcom is saying, from a market-economy viewpoint, ‘irrational’, not justified by a narrow view of the balance sheet, leaving aside a vast array of societal and other less-easily measured benefits.  Substitute ‘imaginative’ or ‘innovative’ and ask why Community Interest Companies (or public/private partnerships) could not open up real local competition as they do in Sweden.

Surely, you might say, Ofcom was set up not to create government policy but to use regulation to achieve it.  You’d be right.  The gap between consumer expectations and what Ofcom can actually deliver is not helped by a policy void and mis-selling the mission.  The consultation’s opening statement, correctly, refers to Ofcom’s legal duty under the Comms Act 2003.  Ofcom’s website advertises the role as ‘Ensuring ….. availability’ of high speed networks nationwide.  The actual legal duty, alas, requires Ofcom only ‘to give regard to the desirability of encouraging the availability and use of high speed networks’.

The question not posed, but clearly exposed, is whether our government is giving Ofcom clear and sufficient direction about policy along with targets for using regulatory levers to ensure delivery.

If there’s still time please ‘give regard to the desirability of encouraging’ Ofcom to crack on with looking after consumer and citizen  interests – but a copy to your local MP might also be a good idea.

This editorial feature was first published in NetworkingPlus magazine, November 2007. 

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