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The Rt. Hon. Stephen Timms MP, Former Minister of State for Competitiveness
All Party Parliamentary Group on Communications, House of Commons, London, 18 October 2007
Thank you Derek – I am delighted to be here.
Last month I paid a visit to Cumbria. On the way back through Carlisle, I saw by the railway station outside a church, which Eric Martlew the local MP tells me is an Elim church, one of those bright fluorescent posters with a message for passers by. “There are some questions in life”, it says, “to which you can’t find the answers on Google”. And then alongside someone has written in pencil: “Try Wikipedia”!
The reason I was in Cumbria was to find out about progress with digital switchover. Last night, Copeland in Cumbria, including the town of Whitehaven, had its analogue BBC2 signal switched off to be replaced by digital transmission, and next month all analogue television transmission will be switched off altogether. It is the first small step towards complete UK digital TV switchover.
The process which began last night has involved a lot of hard work, as I saw on my visit – for example on the part of Brooks the local television shop, the local branch of Curry’s and of Age Concern in Whitehaven – a lot of planning and a lot of technical innovation.
In 1996 when digital TV was first trialled in the UK, there was a good deal of foreboding about what lay ahead. You changed something as fundamental as people’s television at your peril! Yet just two years later we saw both digital terrestrial and digital satellite services launched, with digital cable hard on its heels.
Offering a panoply of new services, digital TV is quickly transforming the broadcasting industry. It gave an immediate boost to the take up of multi channel TV. It gave further impetus to the convergence of technology between broadcasting, telecommunications and the computer industry – a convergence which the establishment of this merged all party group reflects. Today, digital TV can be accessed in over 80% of UK homes. Over half of the UK’s estimated 60 million TV sets are now converted to digital. New services are becoming common-place.
It is a particularly current example of individual and disparate applications and technologies coming together, in ever more innovative and fascinating ways, creating a new world in which many features are unrecognisable from the one we grew up in. Its only fifty years ago – this month – since the launch of the first satellite.
I recently paid my first visit to SecondLife. I found it a fascinating and disorientating experience. What exactly is real? This morning I have been at the launch of a much more prosaic application – an online procurement system for use in the construction industry. Wherever you look, the applications of technology are gathering pace. And in my job as Minister for Competitiveness, there are lots of challenges on which we need to deliver.
We used to have a mobile network which was outstanding for the low costs and widespread use which its fiercely competitive character had brought about. Its been suggested to me recently that, in Europe, our mobile services now look costly compared with those available in other parts of the world. That is a concern from my point of view as Competitiveness Minister and for the regulator Ofcom. High performance, widely available, good value communications services are key to competitiveness in Britain and in Europe, and the European Union’s new proposals on telecommunications regulation will be high on my list of priorities for this new parliamentary session.
We know that data traffic is going to become more intense. We know that the present infrastructure is sometimes stretched to cope. We do want to support universal access to distinctive, original, innovative services. We don’t want access to be inhibited by outdated technology – and we don’t want new digital divides. We want to be leading the way, not left pottering behind. And it can all change so quickly.
I became e-commerce Minister first just over five years ago, and - I think it was in the week I was appointed - Computing ran a headline saying that, on broadband, the UK was neck and neck with Croatia. That is unfortunately not true this morning on football, but on broadband, with a lot of people working together, we fixed the problem, to put Britain in a leading position worldwide today on broadband availability and use. And that success has made an important contribution to Britain’s economic success over the past few years.
A study on the UK carried out last year for OECD found that increasing the proportion of the workforce with broadband in IT intensive sectors by 10% increased productivity by 12%. A 2005 study on the US for MIT found that in communities with broadband, employment growth rates were 1 to 1.4% higher than in communities without, and the number of business start ups was higher too. As Minister for Competitiveness, I see it as key to UK competitiveness, and one of my highest personal priorities, that we have a high performance telecommunications infrastructure in ever part of the country, enabling us to compete successfully in a globalised world economy.
The Information Age Partnership, which I now chair, recently compiled and published evidence from the UK to highlight how effective use of information and communication technology enables productivity growth. As the technology evolves and becomes pervasive, it creates new market opportunities, the emergence of innovative products and services and challenges existing business models.
We face today a new challenge on broadband. Other countries are starting to invest in new, fibre based infrastructure, delivering considerably higher bandwidth than is available in the UK today. Korea, Japan and the United States stand out, but France, Germany and the Netherlands are pressing ahead too.
Its true there are different market conditions in the UK. We have well developed satellite and terrestrial multi-channel TV delivery networks which is very good for viewers – I’ve referred already to the high take up of digital TV in the UK – but it removes in Britain one of the main incentives driving investment in high speed networks in other markets.
But before too long, the wider economy is going to need high speed broadband. The high speed broadband networks being deployed elsewhere for multi-channel TV will increasingly be used in other commercial applications. I am told that in Korea, 90% of homes have broadband today at a standard speec of 50 to 100 Mbit/s. The growing number of people working at home in the UK will require high speed connections to support them:
all these trends are pushing up the bandwidths which are going to be required across the economy.
And just as we have seen a boost to the economy from our success in delivering one of the most competitive and extensive broadband markets in the G8 – ahead today of the US, Japan, France and Germany – so we need to get on track for high speed broadband to deliver a further boost to the economy over the next few years.
The Broadband Stakeholder Group’s report in April on Next Generation Broadband access gave us a window of two years to make decisions about next generation access, and five months have already passed! We actually have, I believe, quite a short time to debate the issues and decide how to act. And its one of the priorities for me in taking up responsibility for this area of policy again.
Unlike elsewhere, there are in the UK hardly any fibre to the home connections. In fact, I don’t know of a single one. If there are any, I would be grateful if someone can tell me where it is! The OECD records the number of fibre to the home connections in the UK as zero, compared to 46,000 in the Slovak republic, 900,000 in the US and almost 8 million in Japan.
As far as I can see, we are not suffering a competitiveness problem over next generation broadband today, because the applications which require it are not yet in place. Indeed, rather the reverse – our high levels of broadband take up and use are a major competitive advantage for the UK. But commercial applications for the new technologies are not going to be far behind, and we need to make sure we can enjoy their benefits.
We need timely deployment of technology. We can’t afford to lag behind others. We need the right conditions for the market to operate effectively.
There are welcome signs of progress. Virgin Media, whose network passes half of UK homes, is already rolling out up to 20 Mbps to its customers. Since last November, it has been conducting a successful trial of higher speeds, up to 50 Mbps, among 100 customers in Ashford, Kent, with a technology capable of delivering 100 Mbit/s, and the trial is being extended to Dover and Folkestone. BT is upgrading its core network to 24 Mbit/s and will be deploying fibre to greenfield sites from next year, reaching eventually perhaps three million homes. And, unlike in some other countries, BT will provide fibre access from the outset on a wholesale basis to other service providers.
A host of other innovative companies have invested in local loop unbundling, introducing new services. There is a good deal of interest at the moment in Fibre to the Cabinet and sub loop unbundling, with unbundling at the street cabinet so that an alternative operator can instal fibre to and locate equipment at the street cabinet and not have to duplicate copper or fibre to the customer premises. BT, Virgin and Sky have all been looking at this and BT has a sub loop unbundling product, though it has not yet been used commercially. And there are numerous providers of wireless and satellite based connectivity.
But I am not sure this is enough to satisfy future demand for bandwidth, and to support innovative, value generating applications?
That’s why I am convening a high level summit for representatives from Ofcom and the industry at the end of next month, to look at how we can expect to move from where we are today to a future where next generation broadband access will be widespread, and to consider whether – and, if so, how – public intervention might help, as it did with our deployment of first generation broadband.
The infrastructure must be capable of delivering high speed broadband to all. There is an obvious danger of some being left behind, unable to access services enjoyed in other parts of the country. Rather let’s use the new technology to promote inclusion and build new opportunities for those for whom in the past opportunities have been too few. It does need to be based around fibre rather than copper, but with potentially important roles for wireless and satellite too, and for 3G mobile services which are already capable of supporting data communications at 1 Mbit/s. And we need everyone contributing to a debate about how we can bring about the changes we need.
A number of publicly supported broadband projects are looking at next generation access based on fibre and wireless to help deliver positive social outcomes. The Government’s Digital Challenge has been the catalyst for some, such as the One Manchester vision of a next generation digital city. In Walsall, in the West Midlands, the Community Broadband Network has been commissioned to assess the viability of a community-owned social enterprise to deliver next generation broadband in the Birchills area.
More bandwidth brings more opportunities. It also brings more challenges. An immediate and major challenges is to ensure that people, especially children, are protected from inappropriate or potentially harmful material online.
New technology – the internet and computer games – have huge potential for aiding children’s development through play and learning, and we are seeing more and more of that potential being delivered. But we need to think through carefully the new challenges as well, not least because if we get this wrong there will be new barriers erected which could make it harder for us to make the most of the technology in the future.
So that is why the Prime Minister has established the review being lead by Dr Tanya Byron, pulling together the shared responsibility that we all have – parents, government, society, industry – to protect children from harm. The review called for evidence on the 9th October and I hope there will be very wide engagement with the review so that its conclusions are based on robust evidence and good understanding of the social and economic issues.
I was with Tanya last week when she met with representatives of the computer games industry for a very good discussion and I very much welcome the approach she is taking to that work.
Making the right judgments on Internet governance is critical. I want a strong UK contribution to the meeting of the Internet Governance Forum in Rio next month, the creation of that forum being a consequence of UK success at the World Summit on the Information Society in Tunis, reflecting the value of different interests working together to tackle shared problems.
And let me just make one other point here. One of the competitiveness challenges we face – not least to make the most of the potential of the Internet – is to ensure we have the high level science, technology, engineering and maths skills we are going to need in the future. We need to get young people excited about maths and computing. I welcome the fact that applications for maths degrees are up by 9% this year, although for computer science they are down by 1%. And one of the points we were discussing with the computer games firms – who need more and more bright young people with great maths and computing skills – is whether we can use the enthusiasm among young people for computer games to enthuse them for the study of maths and computer science.
I want in conclusion to make some points about the danger of the digital divide. Technology of course does not create exclusion. It’s the way we use it. And I think the way we should look at this is by asking the question: how can we use new technology to reduce the exclusion which too many people have suffered in the past – to open up access to opportunities which haven’t been available before. The $100 laptop is a great example of that being done in practice.
Some people used to argue that avoiding exclusion would mean that the price of mobile handsets should be subsidised, to bring them within reach of low income users. In fact, of course, a dynamic and fiercely competitive market did that job for us - and pre-pay mobile phones, far from excluding people, made modern communications available to many people who had not been able to afford it previously. Ofcom reported recently that overall communications costs for residential customers fell by almost 40% in the last five years – and that has been the benefit of competition.
New technology opens up opportunities for reducing exclusion – what has been happening in Burma has been a good example. We need to be creative and imaginative about how we apply it. We need to realise the potential of changing technology to open up services to people who have had problems accessing them in the past. We are, for example, seeing superb examples of technology vastly improving the quality of life for people with disabilities, with lots more potential opening up all the time.
I imagine all of us will recall, if only from The Full Monty, how grim job centres used to be, with their noticeboards with tatty postcards pinned to them setting out minimal information about jobs available locally.
Today that job is done by the DWP Internet job bank. It gives access from any online terminal to far more information, not just about jobs in the local area, but about 400,000 vacancies throughout the country. I am absolutely certain its one of the reasons we have brought unemployment down so far, and kept it down, over the past ten years.
It is a very clear example of a public service being transformed, of resources being opened up, and incidentally of people being treated in a much more respectful and dignified way than was the case in the past, thanks to the Internet - of the Net serving inclusion, not exclusion.
There are still nearly half of UK households who don't have broadband. The Office for National Statistics has found that 64% of the UK population have used the Internet at home or work – but 36% never has. And that figure has not fallen over the past two or three years.
Taking as the definition of digital exclusion “having no access in the last three months and no access at home”, Ofcom found that nearly half the digitally excluded were over 65. 60% of 65-74 year olds are excluded, whereas exclusion among those over 75 is 79%. That is one reason I was particularly pleased to present the Silver Surfer awards in the Jubilee Room earlier this week. 62% of those with no qualifications are digitally excluded, compared with 6% of those with a degree.
Research by the Scottish Executive found that, while 50% of Scottish households have Internet access, the proportion in the most disadvantaged fifth of households is only 30%, whereas in the best off fifth of households it is 70%.
The aspiration of access for all needs to be kept firmly within our sights. There is a great deal we can do through coordination, and making the most of the resources we have. So, within our Digital Strategy:
The coming together of the previous separate all party groups into this new converged group reflects what is happening in the technology and in the market. Once separate, unconnected applications and technologies are coming together, creating a new landscape with features which are unrecognisable even from the one which the separate groups were set up to address just a few years ago.
It’s a new landscape in which Britain can do well:
None of this is easy, but all of it can be done. And I welcome the contribution of this group in making sure that it will be.
Thank you.