Why I’m not surprised by the government’s rural broadband fiasco

THE National Audit Office’s (NAO) scathing report into the progress of the government’s rural broadband programme came with few surprises.

Among other things, it concluded that the programme known as BDUK – tasked with delivering high speed broadband to rural areas – is at risk of failure, while handing BT a taxpayer-subsidised upgrade to its fixed line broadband network. The NAO questioned the value for money proposition, and said that a reassessment of assumptions and costs was necessary. Tough as it may be for rural communities to hear, I’m not surprised at these conclusions.

Since late 2010, I’ve been questioning why the government has had a hand in this at all. Public funding of fixed line internet access distorts the market for all kinds of other internet access options, and mandates minimum speeds that are stuck somewhere in a bygone era of dial up modems.

What makes this even more difficult to swallow is that, after a complicated procurement process, BT ended up as the only vendor bidding for digital region projects across the UK. This effectively made it a monopoly, with its privately-owned network upgraded by the taxpayer to the estimated tune of £1.2bn. And all of this was happening, as the NAO notes, without clarity on the costs and terms that BT uses in its contracts. Apparently, different digital regions are getting charged different amounts for the same equipment because, well, BT can do what it likes as the sole provider.

The complexity of the programme, combined with the lack of rigorous oversight, has led to where we are today: the delivery of government-funded broadband will be nearly two years late. This is precisely why the government should not be in the business of providing broadband. The flexibility and agility required to keep up with ever-changing technology is simply not something it can do.

But all is not lost. While the government was focused on its fixed line broadband access project, other options are becoming available. Urban areas are experiencing more competition in fixed line fibre access. 4G is rolling out and 5G is next. And satellite and WiMAX are also options. Companies like Gigaclear and Hyperoptic are providing fibre services through their own infrastructure. And community-led organisations, like B4RN and WiSpire, are offering internet access driven by customer demand. There are a growing number of ways to get online, through a diverse mix of access. We may even see more cars, balloons and planes used as hotspots.

In the three years I’ve been writing on this issue, one thing has become clear to me: access to the internet should be driven by consumer demand, not by government policy. The willingness of businesses and consumers to pay for a wide variety of internet access options is driving more and better infrastructure. And by the time the government finishes with its programme, most of us will have technologically-superior access to the internet anyway. And that the government can not provide.

Dominique Lazanski is an independent consultant and head of digital policy for the Taxpayers’ Alliance.