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Innovation Infrastructure PDF Print E-mail
Written by David brunnen   
Monday, 07 February 2011 10:23

Head of CommunicationsFor the majority of folk born after 1970 it must be almost impossible to understand how difficult it was to get things done before the freedoms facilitated by the Internet. Computer Studies at ‘A’ Level for those aged 17 in 1987 barely touched on networked messaging, still less packet-switching.   Dial-up access to ‘bulletin boards’ (text only) was, in 1987, still a minority interest. All that has been transformed in the last two decades.

But those of us from earlier times are much more aware of the pre-networked inconveniences and inhibitions (and sheer labour intensity) that impinged on everyday life and work. Today’s analyst or researcher would find it challenging to envisage a world without multiple regression software or where skill in using a circular slide rule was key to job success and promotion.

It was not only the lack of analytical capabilities that inhibited life in that pre-digital era. When 1982 was declared ‘IT Year’ by then education secretary Margaret Thatcher many observers did not understand that the digital era would enable ‘innovation without permission’.

This freedom didn’t happen overnight. This new-found healthy disrespect for ‘the way we’ve always done it’ was bound to cause upset. That’s what innovation does. So far it has taken three decades for the penny to drop in most minds but the process is still far from complete. Despite being first in the UK market for email (1982), being privatized in 1984 (in part, apparently, to ‘unleash innovation’) and launching a commercial EDI service for businesses in 1988, BT proved to be a drag on digital progress.

Plans for fibre to the home and massive services innovation foundered on account of the cost (roughly equal to the revenue from 3G mobile licences a decade later) and an inability to explain to disconnected and unimaginative policy developers (within both government and BT itself) that the Internet was not a playground for cowboys. Even as Al Gore was championing the funding of the US Superhighway, the UK simply ‘did not get it’.

And the odd thing is that 20 years on from that debacle the UK still doesn’t really get it. Read, for example, the urgings of government on how we should pursue economic growth. Treasury experts will happily sign off on statements about the job creation benefits of a faster rail network – a huge government-backed infrastructural undertaking. But when do they rejoice that an entirely new market worth more than £3bn per annum of largely private sector funding (for at least each of the next 5 years) will realize wider economic growth benefits of more than five times that sum?

Culture minister, Jeremy Hunt MP, is perhaps the one member of our government who has come closest to understanding that enabling ‘innovation without permission’ still has massive disruptive potential.

He points out that the UK’s creative industries now account for 10% of GDP and growth in that sector is way above the UK average. He clearly understands that local television will not be based on a last generation broadcast model but will be delivered digitally via the Internet.

He has grasped the need to reform Ofcom and open the entire digital innovation space to new market entrants. And no doubt he also realizes that a few tiny pilot initiatives in local ‘next generation access’ are woefully short of the scale of endeavor needed to catch up on two decades of under-investment.

But do we hear echoes of this from other ministers? Is the energy secretary fuelled by the prospect of intelligent (network-enabled) metering?

At Communities and Local Government are ministers racing to empower local authorities to understand that these totally new Access networks are local utilities that are needed to drive the highest of priorities for job creation, societal cohesion and public sector productivity?

Do we see the Education and Health and the Justice departments queuing up at Vince Cable’s door demanding that any funds created by apologetic banks should be devoted to this highest of high growth-enabling priority?

George Osborne’s team may now have discovered that the ‘all achieved by market forces’ mantra of the previous government was just thin cover for subsidies to the incumbent (according to recently released data on State Aid approvals) for which we got only delays, pre-emptive strategies designed to protect market share and talk of gradual upgrades rather than a completely fresh start.

Broadband Quality Scores (2010)

How much further do we have to fall behind before government and the media realize that catching up (let alone aspiring to ‘lead the world’) will now require some real effort to get off the copper-bottomed pot.

If economists and market analysts (and HM Treasury) are uncomfortable with calculating secondary and tertiary indirect benefits for infrastructure investment (or admitting to the limitations of ‘efficient markets’) then perhaps we will be reduced to asking how much higher must the price of copper rise before someone calculates the value of scrapping it and replacing it with fibre?

Minister Hunt is right to encourage fresh innovative thinking and localized effort – and he’d be right to not rely on tired last-generation excuse makers for the massive and urgent infrastructure transformation that we needed yesterday.

The digital switchover to fibre will almost certainly have far wider impacts than the completion in the 1950’s of the switchover from DC to AC mains electricity. It’s not even as if we now have to be a pioneer – the solutions are on display all over Europe – but without this major overhaul all dreams of a competitive enterprise-enabled economy are but pointless posturing.

With every passing month the broadband quality bar is raised. Readiness for future applications (even allowing for clever compression and caching techniques) will sooner or later demand much more than symmetric 100Mb/s connectivity. A leading continental manufacturer has just discontinued production of it’s old (so last generation) 100Mb/s Digital Residential Gateway and replaced it with a 1Gb/s product.

In 2020 will our next generation of economically active citizens understand the inhibitions of today that left them with a last-generation legacy?

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This editorial was written for the UK's  Communications Management Association (CMA) whose members spend over £13bn p.a. on networked products and services 

David Brunnen will be reporting from the FTTH Council 2011 conference in Milan (8-10th February) : http://www.ftthcouncil.eu/ftthconference.eu/?cid=4356 

For the full text of the speech by Jeremy Hunt MP to the Oxford Media Foundation see: http://www.culture.gov.uk/news/ministers_speeches/7726.aspx  

Charted Data Source: Broadband Quality Survey 2010, Oxford Said Business School:  Interactive model - http://newsroom.cisco.com/dlls/2010/prod_101710.html  

The Broadband Quality Scores reflect combined metrics for Latency and Upload and Download speeds.  The quoted threshold level (41) is based on predicted application requirements for the following three years.  The overall UK position in 2010 was marginally above the lower threshold (27) of broadband adequacy for today's applications.  14 other countries positioned ahead of the UK have not been shown in this chart.

Last Updated on Monday, 07 February 2011 13:07
 

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