Supplementary Memorandum submitted by
the Department for Culture, Media & Sport and the Department
for Trade and Industry
RESPONSIBILITIES FOR BROADBAND ROLL-OUT IN
THE ENGLISH REGIONS
1. It is important to stress that the rollout of
broadband services is a challenge not only for Government but
also for the private sector. Government action however at national
and regional level has a key role to play.
GOVERNMENT STRATEGY
TO HELP
ROLLOUT IN
RURAL AREAS[1]
2. The Government has set out a number of measures
to intensify competition, support demand and aid provision of
broadband content. These measures will benefit those areas where
broadband is available at mass-market rates (covering around two-thirds
of the population). But they may not make a strong enough business
case for broadband investment in the remaining rural and remote
areas. The primary barrier to broadband rollout in rural areas
is the high cost of capital. The investments needed are large
and attract a high-risk premium. Rollout to rural areas is therefore
likely to be very slow and patchy, even under benign conditions.
3. Our strategy is to;
- encourage infrastructure-sharing by telecommunications
companies to reduce the cost of rollout, encouraging the telecommunications
industry to come forward with specific proposals (within the bounds
of competition law);
- Cut red tape which may be holding back deployment
of satellite broadband services (potentially a major contributor
to rural broadband access); and
- Aggregate broadband procurement by the public
sector in order to provide guaranteed levels of demand in rural
areas. The public sector spends around £1.7 billion on communications.
Research undertaken for the Office of the eEnvoy suggests that
significant benefits could be achieved by moving towards a nationally-co-ordinated
set of regional procurements, each guaranteeing a given number
of public sector sites and given levels of demand for broadband
at each site. The Office of Government Commerce is currently examining
how we might use public sector procurement more effectively.
THE ROLE
OF REGIONAL
DEVELOPMENT AGENCIES
4. Valuable work on the promotion and development
of the broadband market in the English regions is carried out
by the Regional Development Agencies (RDAs).
5. The UK Broadband Fund was established to support
the RDAs (along with the devolved administrations) in taking forward
innovative schemes to meet local requirements for extending broadband
networks. DTI provided high-level guidance for the RDAs, who developed
action plans in consultation with Government and local partners.
6. From April 2002, under the new 'Single Pot' arrangements,
RDAs will work to meet targets agreed with Government, funded
from a single budget which they are responsible for managing.
Many RDAs consider broadband an important aspect of their development
agendas and are likely to be carrying out considerable work on
supporting the market.
7. DTI Ministers and RDA Chairs have agreed that
the RDAs have several roles to play;
- They can develop better-focussed information
for the region, such as the availability of broadband;
- They can co-ordinate the work of other public
sector bodies so that maximum benefit can be derived from their
purchasing of broadband services;
- They can catalyse action on behalf of the industry
through identifying with them the potential markets in the region.
Much of their work will be focussed on rural areas
where there is a lack of provision at present.
DEFRA/COUNTRYSIDE
AGENCY
The Department for the Environment, Food and Rural
Affairs (DEFRA) has an overall role in helping other government
departments and the RDAs take account of the needs of rural areas
in developing their policies. The Countryside Agency, which acts
as an independent advisor to DEFRA on rural issues, is monitoring
the rollout of broadband in rural areas.
February 2002
1 Full details of the UK Strategy can be found in the
UK Online Annual Report 2001, published December 2001 Back
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