APPENDIX 75
Memorandum submitted by the e-Envoy, Cabinet
Office
INFORMATION ON BROADBAND AVAILABILITY
During the evidence session on 12 March I agreed
to write to your Committee with information on broadband availability
in Scotland—and in particular, Alness.
Using ICT to increase the productivity and competitiveness
of businesses in rural and remote parts of the UK is one of may
office's top priorities. And as we discussed, towns like Alness
have already seen signficant investment from Government to create
new jobs; a challenge now is to supply this work with a world-class
telecommunications infrastructure.
Approximately one million households in Scotland
can currently access a Cable or DSL broadband solution; however,
large areas are not yet able to. As John Thurso stated, fibre
networks, owned by both BT and Thus Communications, run along
the A9 road in the Highlands.
However, in towns like Alness, the business
case for investing in broadband and enabling the DSL exchange
is not currently strong enough. The primary barrier to this rollout
is the high cost of capital, the investments needed are large
and attract a high-risk premium.
But, as Patricia Hewitt and I both mentioned
during the hearing, the DTI and my office have a number of initiatives
in place to stimulate investment in broadband infrastructure and
to extend broadband networks throughout the country.
The DTI has provided £30 million to the
Regional Development Authorities and Devolved Administrations
to help develop innovative solutions for expanding networks into
areas considered commercially unattractive. On top of this we
are acting to improve the business case for service providers
in rural areas through:
— investigating how the public sector
can most effectively procure broadband;
— reducing the cost of rollout by encouraging
infrastructure sharing options; and
— picking a broadband brokerage service,
initially in one region.
We are confident that these and other actions
will develop the extent and competitiveness of the UK's broadband
market.
I hope this is helpful. Please feel free to
contact me if you or your committee have any further questions
on this subject.
20 March 2002
| 
