Sep 1, 2008 Digital Divide
While broadband is almost ubiquitous in urban areas of the UK and Europe, there is a real danger that rural areas will not have the opportunity to benefit from the same levels of service and that European economies could suffer as a result.
The ‘digital divide’ is a term we first heard many years ago when concern started to rise that poorer individuals and communities could be left floundering on the edges of the information superhighway while the rest of us raced ahead.
It has not been heard as much of late but there is now a very real danger that parts of the UK and Europe – and indeed the entire continent – could be left behind in the race towards a more connected world.
Broadband in Europe has been a phenomenal success. In the UK alone, broadband now accounts for 83% of Internet connections.
Source: Ofcom / operators Note: Figures have been restated from the 2006 Communications Market Report to reflect more accurate data
However, new services and the latest advanced technologies are often being made available only in those parts of the network where subscriber density is high – in urban areas or areas where there is strong competition for business. This means that the same towns and cities that already benefit from higher speeds and levels of service get the new technologies first, while rural or sparsely populated areas are forced to wait.
This is perfectly understandable from a commercial perspective. Service providers are likely to see a faster return on their investment in these more densely-populated regions. This creates a multi-tiered level of service based on location. Those areas that are classed as unattractive today will continue to be classed as unattractive in the future unless someone intervenes (which, thanks to European Government intervention, won’t be the local government1).
As long as this situation continues, the dominant incumbent service provider in any given country will be able to get away with providing the absolute minimum service at the highest possible price, at the expense of the subscribers who are left to its mercy.
A 2007 report by the Center for Democracy and Technology2 examined the current state of technology accessibility in Central and Eastern Europe and highlighted the existence of a major divide between urban and rural areas and vast differences between the levels of service one would expect in a Western European Union country.
To address this issue the EU issued a directive requiring a universal service obligation (USO) to be set in each country by the appropriate regulator. Alas in the UK (and other parts of Europe) that obligation has since been watered down and now demands only the provision of a single static telephone line with no specific requirement being stated for the performance and type of data service that is made available. Once again this simply leaves the consumer at the mercy of the service providers and, if they happen to be in a rural area, this gives them very little chance of having access to high speed access and services in the immediate future.
The problem is that the European Union sees competition as the only method by which these problems can be resolved. Rather than allowing a progressive local government3 (at a town/city or regional level) to develop a strategy in combination with a number of partners to provide a full end-to-end proposition, it forces them to build a wholesale solution where the only organisation capable of completing the work is the incumbent provider4.
The danger here, for European countries in particular, is that they will be overtaken in the knowledge economy. The EU needs to make some serious decisions over the coming years to make sure that the Asian Tiger economies don’t leave Western Europe behind – and there is a real danger that this could happen if something is not done to impose higher levels of USOs.
Rather than setting targets for ‘e-inclusion’5 with woolly statements like “boosting broadband coverage in Europe to at least 90%”, there needs to be change to an absolute USO that provides a minimum 2Mbps6 to each residential or business property at no worse than 5:1 contention.
However, such a USO would likely cause many an incumbent provider to have a cardiac arrest at the thought of the investment required to provide such a service. The problem can be avoided by simultaneously allowing local government or another organisation to ‘take over’ the USO from any incumbent telco or communications provider with a USO obligation and then use state funding to provide these services. This could be justified on the basis that the market has failed to deliver the level of service stipulated by the USO.
By creating a clear opportunity for innovation in delivery of this USO service, entrepreneurs and alternative networks (i.e. those not owned and run by the state or the incumbent telco) can compete and build niche solutions that exceed the USO, not in terms of technical requirements but rather in terms of the service. That would then give everyone access to higher performance, higher quality broadband and allow everyone throughout the UK and Europe to use its services to their full potential.
- 1. http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:12002E087:EN:HTML
- 2. http://www.cdt.org/international/ceeaccess/
- 3. http://europa.eu/rapid/pressReleasesAction.do?reference=IP/06/1013
- 4. http://news.bbc.co.uk/1/hi/scotland/4478497.stm
- 5. http://europa.eu/rapid/pressReleasesAction.do?reference=IP/06/769
- 6. The International Telecommunication Union Standardization Sector (ITU-T) recommendation I.113 has defined broadband as a transmission capacity that is faster than primary rate ISDN, at 1.5 to 2 Mbit/s
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