Thoughts on UK Broadband: not 100% sure it adds up, but intriguing

Every once in a while something comes up that riles up the telecoms-analyst fibers of my being, and the Labour Party’s announcement of universal free broadband this past week is one of them.

I’ve been chewing at it ever since, and I might be influenced slightly by the comments of various telecoms and tech analysts I already follow on Twitter (or with whom I’ve previously worked at Informa/Ovum), but I find it notable that very few of my old colleagues are able to say a good thing about this proposal.

That could be because they’re all right-wing Tories, of course, and I have seen a few of my more excitable former colleagues throw around words like “socialism” in regard to this deal.

(Incidentally, living here in the US makes me bristle when right-wingers refer to things as socialism, but in this case I do have to concede that nationalizing the broadband industry is, in fact, socialism. But I digress)

I suppose my main objection to this idea is that it feels (not for the first time) like Jeremy Corbyn promising unicorns and free ice cream to everybody, when there are more important issues to slay in this election cycle. I’m obviously not voting in this election, but I want to read a coherent position from Labour on whether we need a new referendum on Brexit, what an actual Labour Brexit would look like, and what kind of immigration regime they’d institute on leaving the EU (they have talked about these things, but I’m kind of used to vagueness from Corbyn on this topic).

I’d also like to hear what Corbyn and shadow chancellor John McDonnell aim to do about kickstarting the workforces in areas, particularly in the north, that still haven’t quite recovered from the Thatcher years. The problem, as I see it, is that the UK’s government, finance and media are so centralized on London that there aren’t any opportunities elsewhere in the country, which is also leading to the demand on housing in the capital. Most importantly, I’d like to hear how Labour intends to shore up the NHS, after decades of under-investment.

This is not to minimize the importance of bridging the digital divide between urban and rural residents, a problem that plagues basically every country. From the point of view of ensuring equal opportunities for everyone, making sure every community has access to the same quality and speed of broadband is a noble ideal. The argument Labour is making is that a single, centralized provider, run by the UK government, is better able to plan and implement the work to ensure that universal access, while also cross-investing from more profitable areas to enable spending in less profitable areas (i.e. everywhere outside the cities).

That post by Assembly Research misses the point that the cut-throat competition to offer faster speeds at lower prices hasn’t resulted in access for those who live outside of those areas. I’m more persuaded by Dean Bubley’s take that the costing is suspect – especially once all the companies affected by the decision (from the wholesalers piggybacking off BT’s fiber network to the mobile operators that rely on it for their own backhaul) take the government to court.

The best takes, in my opinion, are these two articles from Wired, which present McDonnell’s proposal, the implications thereof, and the feasibility based on research the current UK government has already undertaken, which also examined the possibility of a single monopoly provider.

The latter, in particular, ends with the best quote I’ve seen:

The true danger is that this new plan will put a spanner in the works of current fibre broadband plans, and make any future progress more sluggish, rather than speeding it up. It is private investment from the likes of BT, Virgin and Cityfibre that has driven connectivity across the UK, and they could give up or wind down their activity if they believe the government will dominate the space.

This scenario was also outlined in the advice to the government, which would be a “significant departure” from the current approach. The report claims it will “reduce network competition, both now and in the future which is likely to have a negative impact on quality, choice and innovation.”

“They have a strong vision. But the idea of going back to a monopoly would require redesigning the institutional framework of the market, which won’t help if the goal is to get fast broadband for all in a short period of time,” says Paolo Gerli of Northumbria University. “It might be good to leverage what is in the market rather than try to implement a completely new system.”

As the final quote says, there’s a discussion to be had about the trade-off between speed and completion. If Labour does proceed with the plan, it’d do better incentivizing existing ISPs to cover more of the UK’s landmass, rather than population, as a way to achieve its goal quickly.

The other option might be to break OpenReach up completely, and allow cities, counties and local councils to design their broadband provision plans according to their own needs, with perhaps a minimum reach and speed goal that the UK government could impose.

Although that idea suffers from two flaws. For one, it feels a little too close to what we did in the US when breaking up the telecoms monopolies; for another, it feels a little too free market for Corbyn’s comfort, as well as decentralizing power. Who knows?

All I know is that a nationalized, free broadband service sounds great but feels a little too pie in the sky. If they want to sell it, Labour needs to provide more actual information on how much it will cost, and guarantee that it won’t become a political appointment.

Or they can forget about it and fix the railways, the NHS, joblessness outside the capital, income inequality…

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s